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Plan Ahead | Student Loan Repayment

Plan Ahead | Student Loan Repayment

June 22, 2023

The current student loan repayment landscape is complex and ever-changing. The COVID-19 pandemic has led to several changes to the student loan repayment process, including a temporary pause on payments and interest. However, these changes are set to expire 60 days after June 30, 2023, but it is still being determined what will happen next.

Congress is currently debating many issues related to student loan repayment. These include:

  • Student loan forgiveness: There is a growing movement to forgive a portion of student loan debt. Some proposals call for forgiving all student loan debt. In contrast, others would forgive debt for borrowers who work in public service or have a low income.
  • Changes to income-driven repayment plans: The income-driven repayment plans are a series of programs that allow borrowers to make monthly payments based on their income. These plans aim to make student loan repayment more affordable for borrowers who are struggling to make payments. The downside is, accruing interest on student loans in these plans makes it challenging to pay off the debt over time.
  • Changes to the Public Service Loan Forgiveness program: The Public Service Loan Forgiveness program is a program that forgives the remaining balance on federal student loans after borrowers have made 120 qualifying payments while working full-time in public service. The program is plagued by problems, including long wait times for approval and a low approval rate.
  • Changes to the interest rate on federal student loans: As of this date, the interest rate on federal student loans is 0%. Interest rates are due to rise, but lawmakers are considering legislation to extend the 0% interest rate on federal student loans.

These are just a few of the issues before Congress. It is essential to stay informed about these issues and to contact your elected officials to let them know what you think.

Best Steps to Take When Paying Off a Student Loan

If you have student loan debt, make a plan with steps you can take to make the repayment process more manageable. Creating a budget should be the first step in your plan. Please reference our Back to Basics blog for tips on budgeting at

Here are a few things to consider.

  • Consolidate your student loans if available. *Contact the lender for options.
  • Consider all repayment plan options carefully. *Read the fine print!
  • Make extra payments when possible. *Did you receive a surprise bonus; put it towards your student loan?
  • Stay informed. *Be aware of all of your options and services provided for you.
  • Keep going: *Many resources are available to help you, including your loan servicer, the Department of Education, and nonprofit organizations.

Whether your student loans are new to you or your loan repayment is on hold, you must have a plan of action. Any debt can be challenging (see our Back to Basics blog on Debt Management at, but it can be managed. Following these tips and having a plan can make the process easier and get you on the road toward financial freedom.

Jacob, an LPL Financial Advisor at Dixon Financial Group, LLC, along with millions of Americans, is experiencing the student loan dilemma. The DFG team learns from life and wants to share our knowledge with you. Contact the DFG team if you have questions at team@dfgadvisors or call 702.982.2479. Please 'share' what you have learned today, to inform friends and family members. Thank you!

Jacob S. Bierstedt, CFP®, ChFC

David S. Dixon, CFP®