Trump Won. It's a Reality.
Now how will it affect your student loan repayment? Here's an idea
Now that the dust has settled and everyone has placed their votes, the next president of the U.S. is Donald Trump. Whether you are excited or completely discouraged we want to take a little time to talk about how this may affect student loans for the next four years or for many more to come.
Student Loans were not a priority in Trump's Campaign oppose to Clinton's plan. Clinton’s plans were to cut interest rates, offer better refinancing options and loan forgiveness. Clinton's plan was well thought out and clear. Trump did not speak much of student loans until the end of his campaign in Ohio when he brought up the subject of our student debt crisis.
Trump's proposal would cap repayments to 12.5% of a borrower's income. This income based plan would last 15 years and would be forgiven if you completed the entire term.
You may be also be asking yourself how the government could afford to forgive this debt after 15 years as opposed to the current 20 year term on some IBR plans? Trump's plan is to cut government spending to allow the remainder balance be forgiven by tax payers dollars. This is in direct opposition of the beliefs of most of his party.
“What’s remarkable about Trump’s proposal is it flies in the face of the fiscal conservatism that’s supposed to define the Republican Party” - Danielle Douglas-Gabriel.
For example, Trump's plan could potentially save you up to $20,000 in principal and interest. If you graduated with $75,000 in student loan debt with an average interest rate of about 6% and a yearly income of $50,000 dollars.
As we look ahead to the first few months of 2017 as Trump begins his term at the White House we most likely won’t hear much about student debt. He has promised to address other issues in his first few months of office.
A student loan holder can’t sit back and wait as they pay more and more in interest. They need to take action and look into their own financial future. Setting personal goals and finding alternatives like ChangEd will create the impact we are looking for.
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