Student Loan | July 12, 2023 | Lisa Litant
What you'll learn
With federal student loan payments starting up again, you may be concerned about how they’ll impact your budget. Here are the details on when your payments will start and tips on how to prep for them.
Note: Private student loans (from banks and other financial institutions like Sallie Mae) were not part of the federal pause, and payments will continue to be made as usual.
Federal student loan payments will be due starting in October, and student loan interest will resume starting on Sept. 1, 2023. Your federal loan servicer will notify you at least 21 days before the loan payment is due. Their communications will give you the actual amount due and the payment date.
To get an estimate of your upcoming payment and when it’s due, you can contact your federal loan servicer. There may have been some changes over the past few years in the company that’s servicing your federal loans, or you may have just graduated and will be making your first payments. It’s important that you know your servicer—here’s how to find out and what you need to do:
There's a chance that they may. Your payment will be based on:
You can get more information on whether your payment amount will change on the federal student loan site.
If you paused payments during this period, the date you pay off your student loans may be extended. For instance, if your repayment term is 10 years and you paused for two years, then that 10-year date may be pushed out two more years.
On the other hand, if you’re on an income-driven repayment (IDR) plan, then those suspended payments will likely count toward your forgiveness and your end date probably won’t be pushed out. Your servicer can confirm when your end date will be.
Since it may have been a while since you’ve made federal student loan payments, the Department of Education suggests that you take these steps before your repayments start again.
If you decided not to make payments during this period, you may be out of the habit of regularly making them. Start putting aside money now for when your payments resume.
This is also a good time to look at your income and expenses to see what impact student loan payments will have on your budget. Use an online budget app; this monthly budget worksheet can help you get started.
There may be ways to get help making your payments:
One thing you shouldn’t do is ignore your required payments, which could put your account in default. This is a serious decision. Consequences of being declared in default can include:
At the first sign of financial difficulties, contact your federal student loan servicer to find out what repayment options are available to you.
If you’re having difficulty making payments for both your federal and private student loans, contact your loan originator and servicer right away. They may be able to work with you to help you through this period.
With a little planning now, you can feel confident as you move ahead with your monthly federal student loan payments.