By Jasmine Browley ·Updated October 9, 2023
President Joe Biden has announced another student loan relief initiative to the tune of $9 billion.
“This kind of relief is life-changing for individuals and their families. But it’s good for our economy as a whole as well,” Biden said October 4 during a press conference at the White House.
The announcement comes after a three-year-long pause to federal student loan payments came to end this month.
“By freeing millions of Americans from the crushing burden of student debt, it means they can go and get their lives in order,” Biden added. “They can think about buying a house, they can start a business or starting a family. This matters. This matters in their daily lives.”
Earlier this summer, the Biden Administration launched Saving on a Valuable Education (SAVE). The plan already includes lower monthly payment options, faster forgiveness for those who qualify and does away with growing balances due to unpaid interest. Now, the administration’s latest announcement promises an expanded version of what’s already in place.
As previously reported by ESSENCE, this comes months after the administration initially fought for this program amid many others aimed at alleviating the nearly $2 trillion in US student loan debt after the Supreme Court struck down widespread loan cancellation.
Among other details, The SAVE plan offers a one-year grace period for payments.
“Some aspects of SAVE will be implemented this summer, some not until July 1, 2024,” Mark Kantrowitz, author and student loan expert, told Yahoo Finance in an interview. “In particular, the cut in the percentage of discretionary income for undergraduate debt from 10% to 5% will not be implemented until July 2024.”
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