When the U.S. Department of Education announced it would resume collections on defaulted federal student loans starting May 5, 2025, it marked the end of a five-year pause that had offered millions of Americans much-needed financial respite. The move, part of the Trump administration’s broader approach to student debt, signals a return to market-driven policies that emphasize personal responsibility and minimal government intervention while holding educational institutions more accountable for graduate outcomes. But for borrowers across the country, the reality of this shift has been anything but simple—or painless.
Faith, a 33-year-old higher education administrator from Burlington, North Carolina, found herself at the sharp end of these changes. After taking on $38,113 in federal student loan debt to earn her master’s degree during the pandemic, she expected her investment to boost her career and maybe even help her buy a home. Instead, she’s facing a much steeper repayment schedule than she ever anticipated. “I wasn’t aware of the detriment it would have on my future,” Faith told The Guardian. “You really don’t know the full scope of what you’re getting into [when taking out student loan debt] … I got my master’s specifically to progress in my career, but what I make now versus what I owe on the degree, it’s almost like it doesn’t make sense.” She added, “I always regret that decision.”
Faith’s situation grew even more challenging when, on August 1, 2025, the Trump administration resumed charging loan interest for borrowers under the Saving on a Valuable Education (Save) plan—a 2023 income-driven repayment plan introduced by the Biden administration. According to The Guardian, the Trump Department of Education effectively ended the Save plan by recommending borrowers switch to other repayment options, which means interest now accrues and progress toward forgiveness is halted for those who can’t make payments.
For Faith, this meant scrambling to find an extra $300 each month on top of her $1,200 rent, before factoring in utilities or living expenses—a financial stretch that has put her life plans on indefinite hold. “Luckily I don’t have any dependents … but all the people in their 30s around me, it feels like we’re all going backwards,” she said. “I’m scared for what the future looks like, especially as we get older. Does that mean, unlike our grandparents whose homes were paid off and who were free of debt, that we’re just going to be in debt?”
Jennifer, a 34-year-old public school teacher in Portland, Oregon, faces a similarly daunting challenge. With $63,419 in federal student loan debt, she left the Save plan to continue making progress toward loan forgiveness for teachers—a move that nearly doubled her monthly payments from $250 to $480. “I don’t understand why it’s so high,” Jennifer said, but she felt she had no other choice. Like many educators, she juggles extra jobs—babysitting and hosting bar trivia nights—to make ends meet. “The [Trump] administration claims to be pro-family, but is screwing a lot of people over—including ones with families, including ones who want to build a family,” she told The Guardian. The financial strain has forced her to ask her parents for help with her car loan, a humbling experience at 34. “There’s so many Americans who don’t have access to generational wealth in that way, and so many teachers who don’t—and we wonder why the teaching field is so white, so unrepresentative. It’s so expensive to be a teacher.”
Meanwhile, Sedona, a 30-year-old lawyer in Seattle, is staying in the Save plan despite accruing interest on her $170,848 in federal student loans. “In my therapy sessions, we talk a lot about how so much of my anxiety and issues are tied to financial concerns,” she said. “It’s kind of like always sitting there, as this heavy weight.” Even with a good salary, Sedona and her partner live paycheck to paycheck, rarely indulging in small luxuries and picking up gig work to cover expenses. She feels the Trump administration’s rollback of Biden-era relief “aggressively punishes those already in often severe levels of debt, while it simultaneously gives lavish tax giveaways to wealthy individuals and corporations.” The couple dreams of adopting or fostering children, but can’t see a financially responsible path forward. “It feels like, when do I get to start living my life? We’re a generation of people who feel jilted.”
Chris, a 46-year-old from Aurora, Colorado, has about $50,000 in student loan debt, down from $65,000. He’s keeping his loans in forbearance and paying interest as long as possible, prioritizing other debts. “It’s not that I don’t intend to pay my student debts, I understood it was a loan like any other to be repaid,” Chris said. “But the repayment costs need to be able to fit in a budget that allows for personal and professional growth.” He feels the Trump administration wants to “keep those with [student] debt in it for as long as possible,” and hopes that the midterm elections will bring leaders who can “undo this mess.”
These personal stories underscore the broader policy landscape. According to IndiaExpo2020, the Student Loan Forgiveness update for June 2025 is built on a market-driven educational paradigm that prioritizes individual accountability, minimal government involvement, and institutional responsibility—hallmarks of Trump administration thinking. Earlier proposals included a single income-based repayment plan, capping payments at 12.5% of income and forgiving remaining debt after 15 years. The administration has also aimed to eliminate subsidized loans for low-income students, impose stricter guidelines on Public Service Loan Forgiveness, and tighten regulations on loan servicers.
Borrowers do have several debt management options under the 2025 program, including:
- Income-Driven Repayment (IDR) forgiveness: Monthly payments based on income and family size, with any remaining balance forgiven after 20 or 25 years.
- Teacher Loan Forgiveness: Up to $17,500 forgiven for teachers after five years of service at qualifying institutions.
- Discharge for total and permanent disabilities: Federal student debt may be discharged for borrowers with significant disabilities.
- Military and AmeriCorps benefits: Special repayment programs and interest rate limitations for qualifying service members and volunteers.
Yet, the Trump administration is not expected to pursue broad student loan forgiveness, and modifications to existing income-driven repayment and forgiveness programs could further limit options. There’s also uncertainty about how these changes will affect public sector workers and those relying on the Public Service Loan Forgiveness program.
Meanwhile, other financial updates for June 2025—such as a $2,970 direct deposit, SSDI payments, a $4,000 Trump Senior Bonus Payment, and a 5.3% increase in SNAP benefits—offer some relief to select groups, but do little to address the core anxieties of student loan borrowers.
For many, the end of the Save plan and the resumption of collections have come as a gut punch. As Faith, Jennifer, Sedona, and Chris’s stories reveal, the consequences go well beyond budgets and bank accounts, shaping life choices, family plans, and even mental health. As the nation heads into another election season, the future of student debt relief remains a deeply personal—and deeply political—question for millions of Americans.
