1.6 USD trillion. How much money 45 million Americans collectively have student loan debt. Think about it – how many people do you know who are still paying off their loans? Chances are you and a bunch of your friends and family are still repay the loans. And given COVID, it’s not something that’s likely to change for long. With the economic hardships hanging over student loan repayments for most Americans, more and more government officials are pushing the Biden administration to write off student loan debt. And while Biden agrees to cancel part of it, for the benefit of all borrowers, he must cancel everything. And so on.
Right now, Biden is likely to forgive $ 10,000 per borrower. And while that would be a good start, for many of us suffering from student loans, that amount wouldn’t do much. He strength reduce some of the interest, but for people who aren’t making a lot of money and can barely afford the bare minimum, they won’t even notice that $ 10,000 is missing. It could be a pretty nice break for those who have just finished their studies. But if you’ve been out of college for a while, it won’t do much. And while Biden extended the pause on payment pay off student loan debt due to COVID, if they don’t also suspend interest, that money will likely only cover it. Which means borrowers won’t even go ahead with that level of forgiveness.
If you are someone who has a low income job like retailing, or if you are in an industry where you do not earn much, it is difficult to pay off your student loan debt. Sometimes it feels like you’re just working to keep a roof over your head and pay off your loans. And if you live in an expensive city, your cost of living can make it impossible to pay off your loans. Not because you don’t want to, but because you just can’t afford it. If you work more than 30 hours a week and are struggling to make ends meet, paying off your loans can be an impossible task. And if you’re in such dire financial straits, Biden’s $ 10,000 solution isn’t really for you anyway.
My partner and I have significant student loan debt between the two of us. I have been in default on my loans most of the time I was out of college. And while my partner has been able to pay off her student loans steadily over the past few years, she is only paying the interest and hasn’t even touched the actual amount she owes. We’ve both had pretty stable jobs over the past few years, but it’s still not enough. We would of course be grateful for Biden’s $ 10,000, but it really wouldn’t make any difference in terms of the refund. We’re still going to pay them for what looks like the rest of our lives. Student loan relief would really change the way we might live our lives, and we’re not talking about tropical vacations, we’d be happy with an emergency fund to help cover the cost of surprise and unforeseen expenses.
For us and others like us, the only way to make real progress is to ask the government to completely write off student debt. And before you comment on whether we made a deal, blah, blah, blah, here’s the thing. You can sign a contract and enter into an agreement with the full intention of honoring it. But then things happen that prevent you from doing what you have agreed to do. As a nation, we are told that the only way to move forward in life is to go to college and find a good job. But then you have hundreds of thousands of people walking around with college degrees and working in retail because you can’t get a job that pays enough to keep up with your student loans. Since we do what we were told, since we gained the education that should open up opportunities for us to give back to society, the government should offer us some relief.
I am a millennial and my generation has been accused of killing industries such as diamonds, washing machines and restaurant chains. We often receive reviews for do not buy houses, have no children and live at home longer than previous generations. But we are a generation facing incredible student debt and struggling to find good paying jobs. Pair them with the overwhelming amount of loans we are paying off, and there’s no way we can move forward unless something changes.
“With the cancellation or reduction of the repayments of their student loans, these borrowers could spend more money from one month to the next, which would allow them to participate more actively in the economy”, Rebecca Safier, expert in personal finance, also a certified student loan advisor at Student loan hero, Told HuffPost.
Generation Y is late at least a major event in life, according to a survey carried out by The bank rate. They postpone the most savings for emergencies (38%), which could put them in a more precarious financial situation in the future. Putting off buying a home (31%) and not paying off other debt (28%) are the other big things we don’t do. Of course we are not. Because student debt affects all of this. If most of your income is used to pay off student loans, you’re not saving for other things. But if you don’t pay other debts on time, you can’t get enough credit to do things like buy a house or a car.
Beyond Biden’s current plan, there are other Senate and House resolutions that deal with student loan debt. They would write off a larger amount of debt, which would create a stronger impact. Elizabeth Warren and Senate Majority Leader Chuck Schumer’s resolution would cancel up to $ 50,000. And in the House, the representatives. Ayanna Pressley, Ilhan Omar, Alma Adams and Maxine Waters proposed a companion resolution. It’s hard to say if this will go any further than Biden’s $ 10,000 plan, but since he’s leaving it to Congress, maybe there could be some sort of leverage.
Canceling student loan debt isn’t just a problem for people with student loans. We are the ones who struggle the most, but it is an issue that concerns us all. If all the debt is written off, think about what more people can do. Without this debt hanging over their heads, they can do things like buy homes and save for retirement. If we are not in debt, neither will our children. Student loans should no longer be a burden on people’s necks. If the government really wants to stimulate the economy, they will cancel everything. Because if they can bail out the big companies, they can bail out the millions of people who are drowning under the weight of student loans.