Navigating student loan forgiveness with financial planner Michelle Buria

We’ve all heard by now about President Biden’s plan to wipe away up to $10,000 of federal student loan debt for some borrowers, and up $20,000 for recipients of Pell Grants.

Michelle Buria, CFP®, MPAS®, Senior Director of Choreo, LLC visited The Lift Wednesday to unpack what this means for borrowers. For some this decision will completely eliminate their student loan debt, and for others it will reduce the amount going forward.

So with the moratorium ending, here’s three things to consider:

1. Update Contact Information

Michelle says we should visit studentaid.gov and update our contact information. That’s how you’ll be notified of these programs. The student loan forgiveness plan requires application process that you’ll want to finish as soon as possible. Sign up for alerts from the Department of Education‘s website to know when that application becomes available. You’ll want to apply before November 15.

2. Look at programs and repayment options

You’re going to want to stay on the studentaid.gov‘s website for this one- there’s a loan simulator you can use to figure out which repayment plan works best for you.

3. Create a budget

Create a budget now that factors in the payments you’ll have to make. It’s been three years since borrowers have had to make a student loan payments, if you’ve stopped paying entirely you might want to consider the adjustments you’ll have to make.

If you have money set aside for repayment, now’s the time to target higher interest debt and build your emergency fund. You should have 6 months – year of living expenses saved up. If you still have student loan debt, make sure you make your lump sum payment before that by the end of the year to avoid accruing interest.