BOISE, Idaho — Federal student loan payments are restarting this month, after a three-plus-year pause due to the pandemic.
Bills will now be due for more than 40 million borrowers, who collectively owe about $1.7 trillion in student loans. Interest started accruing again in September.
If you are one of the borrowers bracing for student loan payments to restart, you can find out your monthly payment online with your loan servicer. If you don't know who your loan servicer is, you can find out by logging into your StudentAid.gov account.
If monthly payments are too high - you have some options.
Last year, the Biden Administration announced the Saving on a Valuable Education, or SAVE Plan, to make student loans more affordable. It's an income-driven repayment plan that looks at the borrower's income and family size to determine a loan repayment that's affordable.
The Gem State has something called IDeal - Idaho's 529 College Savings Program meant to help families save and pay for education in a tax-advantaged way.
IDeal can be used to help pay off up to $10,000 in student loans. Family members can contribute to the plan. Any contributions can be deducted from Idaho state taxes, and earnings on anything put into an Idaho 529 are tax-deferred at the state and federal level.
"Basically, using a 529 to help pay off student loan debt means that [students] can take that money off of their Idaho state taxes," Marilyn Whitney, executive director of IDeal said. "They can also encourage family and friends to donate or contribute to their Idaho 529. And if family and friends are Idaho taxpayers, they also get that state tax deduction."
The program was enacted by the Idaho State Legislature in 2000. Since then, IDeal says they've helped more than 60,000 families save for education.
"All it takes is $25 to open an account," Whitney said. "And if you save regularly, that money grows over time, and can really helped mitigate student loan debt down the road."
More information about Idaho's 529 program can be found on the IDeal website.
With the restart of federal student loan payments, there is also a 12 month on-ramp transition period to help borrowers who might struggle now that payments are resuming. If a borrower doesn't make a payment for the first 12 months, they won't be at risk of default or hurt their credit score. However, payments are still due - and interest will continue to accrue.
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