Borrowers are reassessing their budgets as student loan payments resume after pandemic pause
Millions of Americans must start repaying their federal student loans again in October, with monthly payments averaging hundreds of dollars
NEW YORK — Millions of Americans must start repaying their federal student loans again in October, with monthly payments averaging hundreds of dollars. To get ready, borrowers are cutting expenses, taking on additional work, and looking for options to reduce their monthly payments.
Megan McClelland, 38, said she has started asking for October shifts with a catering company and a winery to help supplement her income.
McClelland's main job is as a counselor at Petaluma High School in California. During the more than three years payments were suspended because of the pandemic, she paid off her car loan and was able to save for the first time. She'll put the $235 she was spending on her car payment toward her student loan, but that still leaves another $270 or so she'll have to reallocate or earn.
“It had been a huge relief the past few years to not have that financial burden,” she said. “In the next months, I'm looking to see where I can scale back in my budget. Probably less going out to eat, and more picking up side gigs.”
Justin Cole, 35, of Little Rock, Arkansas, said he doesn't know how he's going to come up with the $166 a month he'll owe starting in October. That's the estimated payment on his roughly $19,000 of loans from paying for college more than 10 years ago.
“I’m already in a mountain of debt, and while I just got a raise at work, it doesn’t go into effect until we're full staffed at my family practice clinic," he said.
Cole works the front office at a medical practice, checking in patients, handling records and managing payment collection. Some of his other debt comes
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