1 year ago in my last loan update, the forbearance was set to expire January 31, 2022, just under 2 years since it had began. Whether it was manifestation, the student debt crisis, our current people in power, or all of the above, it has been extended (for the last time) until December 31, 2022. Along with this came the announcement of student loan forgiveness!
On August 24, 2022, President Biden announced a one-time debt relief program that would award forgiveness for eligible individuals for up to $20,000. The loans need to be federal loans (private loans do not qualify) and you need to be making less than $125k a year (or $250k if you’re married). If you received a Pell Grant, you’d be awarded $20,000 in forgiveness, and if not, $10,000.
They released the application mid-October and it takes less than 60 seconds to apply, so if you haven’t done so already do it NOW! You have until 12/23/2023. I got an email that they’d be “working with [my] servicer to process any relief for which [I’m] eligible after November 14th, but that if I applied already it might speed up the process. Of course I got this email after applying, so we’ll see. Since you’re seeing this before they “process any relief” on the 14th, I guess you’ll have to stay tuned for a forgiveness update. *UPDATED TO ADD* – A Texas federal judge has struck down this plan, so applications may not be open. The Justice Department has appealed this and are hopeful that they’ll be successful. However, stay tuned to see what happens…
Many said this was not enough, and to some it isn’t. However, I’ll take what I can get, and for many, this will eliminate the remaining balance of their debt likely removing a huge burden off their shoulders. To read about some of the other plans in motion, read the fact sheet here. I hope that this is only the beginning to a change in how we educate and handle student loans moving forward. I’ll still be crossing my fingers and manifesting in the meantime that student loans remain interest free forever, although with this forbearance coming to an end in the beginning of next year, my hopes are not very high.
Last year I talked about many of the changes I had made since my original post (spreading out my payments weekly instead of monthly, getting a HYSA with a twist, and creating a budget journal to help others trying to begin their journey). There hasn’t been much change since then, just sticking to it and crossing things off the to-do list. Consistency truly is key.
Paying off this 5th loan brings my balance to just under $17k. Once my forgiveness has been processed, my new balance should be about $7k leaving me with about a loan and a half left (not including the interest I will then be accruing). With under 2 loans remaining, it’ll be the home stretch baby!
Sticking to my goal of one loan a year means I should be fully paid off by early 2024!! :O If this forgiveness goes through early, and I’m able to swing it, I’d LOVE to be able to be fully student debt free by this time next year. You’ll have to stay tuned for that update to see if I did it! (So make sure you subscribe to the blog so you don’t miss it 😉 )
As always, thanks for reading ❤
Until next time!