The postponement of student loans will soon end. The federal government suspended payments in March 2020.
TAMPA, Florida – On January 31, 2022, the postponement of student loan payments by the federal government comes to an end. This postponement was put in place in March 2020 to help people in financial difficulty because of COVID-19.
The Biden administration announced in August 2021 that a final extension would be granted, ending the payment hiatus after the New Year. The announcement was made to give borrowers enough time to smoothly transition to repayment plans.
But those payments pick up just a month after the holiday season, and for the most part, it’s not the most ideal time of year to add extra bills.
“With the next vacation going, we’re going to have tons of distractions,” said Mary Jo Terry, student loans expert and managing partner at Yrefy.
Whether we like it or not, or – more importantly – whether we’re prepared or not, Terry said that’s something everyone should be thinking about now.
“You have to think about what this student loan payment is and how it affects your current budget and expenses. You also need to think about: were you on direct debit? Suddenly money might come out from account that you don’t realize, ”Terry said.
According to Forbes, the average American student debt is $ 37,693. To check the status of your loans, or if it is still the same service, experts recommend that you use www.studentaid.gov.
If you are in a different financial situation than before, it may be possible to continue with the deferral.
“If you are still unemployed and affected by COVID, unemployment deferrals are available,” Terry said.
Terry said that aside from paying for a house, student loan debt is often an individual’s biggest debt. Which is a scary thought when people have gotten used to spending the money that has been used for loan repayments on other things over the past year and a half.
There are resources online, including through your loan provider, to help you prepare for your payments. While you can wait until the deadline to prepare, planning now can give you some peace of mind.
“It will be worth your sanity and your financial health,” Terry said.