Federal student loan payments are starting up again. Here's what borrowers need to know
Federal student loan payments are resuming this month for about 1.2 million Missourians and Kansans after being paused in 2020. But the landscape has changed in the last three years: Borrowers now have new options for payment plans, and their loans could be held by different entities than the last time they paid.
Many people hadn't made payments on their federal student loans since March 2020. But this month, the pause that began at the start of the pandemic has finally ended— due to a provision in the debt ceiling bill Congress passed this summer.
Approximately 1.2 million borrowers in Kansas and Missouri now have a new bill to budget for every month, to the tune of anywhere between $200 to $400 a month, according to Kansas City wealth advisor Jack Giardino.
And a lot has changed since the payments went on pause. Loans may have different providers than before, and a new income-driven repayment plan will help lower some borrowers' monthly costs.
But Becca Craig, a wealth advisor who specializes in student loan payments, says that the right repayment plan depends on your financial situation.
"For high income earners, they might have a lower payment on their current repayment plan," Craig said. "There's lots of different nuances and situations."
- Becca Craig, wealth advisor who specializes in student loan payments
- Jack Giardino, wealth advisor and member of the Financial Planning Association of Greater Kansas City