Hi there, I'm Clint Carpenter, an investment advisor here at Eckman Wealth Management. I just wanted to lead you through a personal financial matter at this time surrounding the student loan situation. It's been in the news lately that the Supreme Court has been taking up this case as to whether President Biden's administration's plan to forgive some student loan debt is lawful.
Just last week, they have announced that it is not. So the Supreme Court is effectively striking down the proposal that would have forgiven $10,000 to $20,000, depending on income limits, and some other past benefits history, for student loan borrowers. So, as you know, if you have student loans for the last three years, payments have been deferred and interest has not been accruing. It's been kind of a nice break, a way to catch up with some of the cost of living increases that we've all been facing and sort of adjust to this era that we're in right now. So student loans are set to resume minimum monthly payments in just a couple of months.
So a couple of quick dates just to know:
September 1st interest will start to accrue again on student loan balances. That's an important date to know.
The next one is October. Just a month later, monthly payments will resume. So, you know, good chance to take some time, make sure that your student loan service provider has not changed over the last three years, many of these loans change hands pretty often, kind of like a mortgage does - they're bought and sold, so you have a new place to make payments. So take some time over the next few weeks to log in, make sure that you're prepared for that.
There is sort of a transition period here that Biden has announced, President Biden, over the next 12 months. Once payments start up. If you miss a payment, it's not really going to hurt you. There aren't any penalties. But keep in mind that interest is still accruing. So if you can afford to make your monthly payments, you should do so.
We'll see. You know, the administration has announced they're pursuing other opportunities to pursue this loan forgiveness plan. But honestly, I think they could take a lot of time. They are likely to be challenged again, and this is just the reality that we're faced with now that payments are resuming in the next few months. So it's a good time to get prepared for that to resume.
So if you've got any questions, you know, student loans, they're different for everyone. Everything I've been talking about here today applies to federal student loans, not, you know, certain private loans. So if you have any questions either way, please reach out to us. We know quite a bit about this topic, and we're certainly happy and prepared to help you.
You can leave a question down in the comments if you've got one, or please feel free to reach out to us directly through email or even just give us a phone call. Happy to walk you through it. But for now, thanks for listening.