President Joe Biden on Tuesday launched a promotional blitz for his new program that helps student loan borrowers repay their debt, just weeks before millions of Americans are set to receive a loan bill for the first time since the beginning of the pandemic.
The Biden administration is mobilizing to convince borrowers across the country to sign up for the new income-driven repayment program — dubbed the “SAVE plan” — which caps interest accrual and lowers the monthly payment amount for many borrowers.
“It’s the most affordable student loan plan ever,” Biden said in a video released by the White House on Tuesday, describing the program as a major reform to a student loan system “that hurt borrowers for much too long.”
“If you’re eligible for the SAVE Plan, sign up now so you can lower your monthly payments in advance of payments resuming this fall,” Biden said.
This is a multi layered problem without an easy solution. At face value, there really isn’t anything wrong with your statement, but once you dive into student loans/college education/how public education made everyone believe the only path forward was college - maybe, just maybe something needs to be done.
Capping interest rates so that people can actually pay their debt down is not a bad thing. The root of the problem still needs to be tackled - college is too expensive and administration departments are too bloated - but when the government guarantees the loans, colleges just raise rates because they know students can get them. Schools are not teaching enough financial literacy to make sure kids understand the opportunity cost of what they are signing up for.
Saying this as a person lived at home and commuted to undergrad and for my master’s degree and paid my loan back.