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mutebathtub

Average National Student Debt is \~$28,400 at 4.66% interest. |Loan Amount|Monthly Payment|10 Year Total Payment| |:-|:-|:-| |$28,400|$297|$35,583| |$18,400|$192|$23,054| |||| |Savings|$105|$12,529| [source](https://smartasset.com/student-loans/student-loan-calculator) edit: if you keep making the same $297 monthly payment after the $10k forgiveness, you will pay a total of $21,158 over 6 years.


legogirl

If he’s only canceling $10k, could he get rid of interest? Please.


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relddir123

Well that’s a bummer


suzanneov

Exactly—it won’t go. But hey, the defense budget needs to be increased and Ron Johnson flew to his vacation home in FL on our dime. 🙄🙄


ThatTinyGameCubeDisc

This right here. Eliminate the predatory interest rates or it’ll climb right back up to line the pockets of scum.


DigiQuip

Also, severely punish universities charging insane costs while sitting in tens of billions in endowments.


ZeroInZenThoughts

Should be treated more like insurance companies and have like an 80/20 rule and publicly disclose how you met that goal.


roguespectre67

It's a big ask when your bank balance at the end of the month is $0. I've done the calculation for my loans and even paying the $160 minimum payment for my loans would prevent me from being able to afford my own housing.


TheYokedYeti

Thank you. So many redditors think everyone has 100k in debt. 10k instant relief would be 30-40% paid off for a ton of people. This is a good thing


BabyHercules

As someone with 25k in loans, while this is great, I think a sizable portion of people would prefer the interest removed instead of just 10k dropped off


Anaxamenes

They should do both, 10k and reduce interest to zero. I think a lot of people would be fine paying their loans if they could just feel like they were making significant headway, that they had a chance.


Ackerack

Fuck, id prefer just reducing interest to 0% for federal and a reasonable legal cap on private loan interest than just a one-time 10k for a "lucky" group of people struggling now. Also, at least half the people I've talked to that oppose student loan forgiveness only oppose it because its a one-time band-aid fix that just pulls money from their pockets to kinda-sorta help the group of people who are struggling now, but then what? Just keep forgiving and making the taxpayers pay for it every time the left has control? I 100% support any and all relief here, but let's be honest, a one-time forgiveness doesn't do much at all.


jellyrollo

He must also repeal [the law Congress passed in 2005](https://www.theguardian.com/us-news/2019/dec/02/joe-biden-student-loan-debt-2005-act-2020) making student loans non-dischargeable in bankruptcy. It wasn't until that bill was passed that student lending became predatory.


uncle-brucie

My fantasy is to be bankrupt! I would be so much richer at zero!


Degenerate77

Most Americans would be.


spcmack21

But...How would he do that? A president can't just hand wave away actual laws passed by Congress, that have already been signed into law. That has to be done by congress. Well, that or a supreme court stacked with unqualified extremists.


jellyrollo

He can advocate for it and get legislation in the works if we give him enough senators to actually pass some laws. There are a lot of Democratic senators who want to do it too, economist Elizabeth Warren key among them. *A lot of this is up to us*, which is something a many people like to willfully ignore.


spcmack21

Oh, 1000%. We have a really easy decision here, and it's really easy every election. There are more of us that want these things than not. If everyone votes for the people that will handle this stuff, instead of falling for the propaganda and staying home, we could change this country for the better immediately.


Dwarfherd

That's gonna need Congress on board, so the people there now will have to be pressured from now to November and if they don't cave replaced in the November election.


Playful-Apartment-20

Any time Congress gets to be productive and it's typically spent to hurt you, me, and anyone we know. And it's ALWAYS when that Congress gets to be led by a Republican in the White House. Thanks, Dubya....


[deleted]

Federal loans, interest rate lowered to 0, private loans interest capped at 0.5-0.75%, and tax credits for those who already paid off their student loans in the last 10 years or so. A little bit of everything for everyone.


unksci47

Wouldn't private lenders stop loaning money if the rate are capped that low? I think 3 to 4% for private loan would be amazing considering what it is now.


Toomuchfree-time

Yes, a private business is not going to lend money at that low of a rate. Capping private loans at 0.75% would basically just end private loans as an option.


[deleted]

And that’s fine. Profiting off of student’s lack of understanding for what they’re signing up for should be outlawed. The goal at that point would be to earn those borrowers as customers for normal interest loans/ credit lines down the road. What I’m getting at is that education should be made accessible to everyone, regardless of their financial status. There’s thousands of other ways for those companies to make a profit, scamming students shouldn’t be one.


BowserBuddy123

Yea, this is a band-aid for a small group of people for political expediency, but doesn’t help future people from requiring band-aids as they get screwed around. We need systemic change and not just a hand out. Why are we having people who didn’t go to school, because it was expensive pay for those who did go to school with loans, while not helping address why school is so expensive for everyone in the first place? I’m totally fine helping people as long as we lift all boats or commit to systemic change, and many people will be offended by me making this personal. I would have totally gone to grad school had it not been so expensive and I knew I’d be saddled with tens of thousands of dollars in loans and interest for my future. That said, this bill doesn’t address any of that expense and I still can’t go to grad school because it’s still expensive and what? I’m going to hope that Dems give me a handout when I make a bad financial decision? So, I get worked by the system because education is expensive, my tax dollars go to someone else who made a completely different personal decision and then education is still expensive, so I’m stuck right where I was. Meanwhile, those individuals that get helped are now competing for the same things in trying desperately to compete for (like access to affordable housing) driving up prices for all those things as we raise demand. What the fuck? Address the issue. I’m a former Republican who has voted liberal for many years and even voted for Bernie in the recent primary, yet I can’t help but feel that no matter what happens I’m just getting screwed. I get it. Loans are predatory as shit. That’s why I never took them. Guess I’m a fool then.. Again, this isn’t to argue against change, but it is clearly a band-aid on a gaping, rotting, puss-covered wound. Systemic change is needed. People talking about capping interest or giving tax credits or even forcing states to pay more into their educational systems and, therefore, offsetting some cost of tuition would be great. All I hear is boomers be like “I worked through school. Young people should too.” Young people are like, “pay off all our debts.” Millennials get the fucking shaft over and over for just being stuck between these polar opposites.


Ar_Ciel

Indeed. The interest alone on my loan is now over $20k. I make $34k a year and that's only recently. I now have a balance of over $75k. I will never be able to pay this down and rent and eat, etc. Without the interest burying me alive.


Tomcatjones

What. No. Eliminate 10k plz.


Astronaut100

This makes so much more sense. Just make the interest zero, and it becomes a whole lot easier to pay back the loan. Democrats really need to up their game when it comes to plays like these. They somehow always fall a little short, which turns off progressives.


CaptainNoBoat

Maybe this is what you're referring to, but interest rates are set by Congress and federal law. Biden and the Ed Department can't change it themselves like the strategy being discussed (EO directing Ed Dept. to forgive debt).


kciuq1

I mean 10k is what he said during the campaign, so I understand why he's going to stick with it. I think the interest rate at 0 would be a great move though, and he could reference the Bible on interest rates to undercut the conservative outrage machine.


eden_sc2

"oh now Biden wants to use *our* Bible to against us? How dare he! He's just taking that out of context. The bible says what I want it to say and only applies when it is convenient for me." There will be no appealing to conservatives anymore.


ew73

No need for such nuance. They'd just say, "That's a _Jewish_ thing!" and leave the poorly veiled antisemitism out there for everyone to see.


kciuq1

Ugh you're not wrong.


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FlushTheTurd

As the vast majority of people don’t have college loans, I think dropping the interest rate to 0% could be supported by almost everyone. Similarly, any interest already paid should be returned. A lot of people are bothered by the government just eliminating $10k from what people agreed to pay. I can understand why Joe Sixpack, who dropped out of high school, and still owes $10k on his trailer can’t comprehend why someone making $150k/yr should be gifted $10k, while he’s making $9 an hour. I think everyone can understand, however, that it’s disgusting for people to be charged 7-10%+ on student loans when banks are able to borrow at nearly 0%. (Finally, I also believe there should be a path through community college and state school that should allow everyone to graduate without debt).


rezzyk

Also, I saw a CNN article today saying “$10k off will reduce payment amounts”. What? No it won’t. Not unless Biden asks the companies to recalculate payments based on the new amounts. Student loans are like a car payment or mortgage, you are locked into an a payment amount until it’s finished, no matter how much extra you put down. It’s not like a credit card CNN…


DishsUp

You don’t have your payments recalculated every year?


hippiekyle

With my great lakes, any time I would change my payment plan, they’d recalculate my payment. I don’t think it would be that hard to implement. They’re gonna have to recalculate payments due to the 2+ year forbearance anyways.


MrOzzMN

I actually was able to make a large payment on mine due to being self employed, GL did not adjust my normal payments. Balance is just under 10k though so looks like I’m set.


hippiekyle

I changed it to graduated extended to reduce the required payment, but I paid extra most of the time. When switching it back to standard, they reduced the monthly payment.


StrangeBedfellows

Payments are based on total. Interest is based on total. Why wouldn't it reduce payments?


Professr_Chaos

No usually payment is based on a timeframe which based on calculations factors in interest. Early on when a payment is made 90+% usually goes towards interest and only a tiny bit hits the principle. When your principle goes down your interest accrued goes down. Making your next payment hit more of that principle the next time. Over time while your principle continues to decrease, the amount of your payment that goes toward interest decreases while the amount going towards the principle increases. This is why it’s advised you pay more than minimums because it increases the amount hitting the principle. However, even when you pay more than the minimum, it doesn’t decrease your next months payment. It’s a little more complicated than that but that’s the basic jist.


flannalypearce

I’m rare here I have just under 10k in loans out and make about 50k a year. This is a blessing financially to me and my family. However I am not ignoring the fact that I have such a low loan amount due to Fafsa grants etc and that I am the exception not the norm. We need a total overhaul or rethinking of student loans this is barely a start.


WhiskeyGirl223

And I will still owe more than I borrowed. Get rid of the compounding interest.


heidismiles

They absolutely should, and apply all previous payments to the principal.


Sanfords_Son

I really like this idea, and I think it’s something that would be more palatable to those who oppose eliminating student debt.


SpatialThoughts

Exactly. I’m fully in support of canceling the interest on student loans and all previous payment going towards principle balance. I’m pretty sure that would amount to more than $10k for quite a few people. And like you said, it would please everyone since it’s not a “free handout” and people will still have to payback what they borrowed.


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seeBurtrun

Forgiveness- which is taxable as income. So you pay lower payments for longer but have a huge balloon payment at the end.


DesperateImpression6

This is a fix that could work and could also be passed in Congress which is what I think Biden's been waiting for. Draft a bill that eliminates interest on federal student loans and gives *every* American a 10K credit for higher education at a public university/community college or trade school/job training (no means testing, this is a benefit for all US citizens). If a borrower still owes on their loan and has paid interest in the past then apply all interest + interest that could've been gained on that money had it not been charged payments to the principal. If you've already paid your student loans your 10K credit + any interest you paid can either be passed to a child/spouse (similar to the GI Bill transfer) or used to pursue a post-graduate degree/retrain in a different field. Accelerate the forgiveness for public sector/non-profit workers by adding 4 years to everyone's count. Then shorten the amount of time it takes to receive loan forgiveness to like 6 and open it up to other sectors that provide value-add to the US like infrastructure work or local community work. This'll make the public sector more inviting to recent graduates as they won't be locked in for a decade to reap the benefit. It could also increase turnover as workers that put in 6 years move into the private sector sooner and open new jobs for recent grads. Lastly set up a bipartisan committee that audits public school costs to determine if they're in line with services provided, graduation rates, and post-job outlook for graduates. If it's in line then that school is eligible to receive federal dollars, if not they need to lower their tuition to meet the standard, any future hikes in tuition have to be pegged to inflation to keep receiving federal loan money.


chubs66

Introduce a retroactive max interest cap. E.g. the lender may never collect more than 150% of the original loan amount. Any amounts paid to the lender above that limit is now credited back to the borrower.


P1xelHunter78

150% is still too much. Way too much. If I can finance my car at 4% non compounding I can finance my student loan at that. It’s non dischargeable for god sake.


Looks2MuchLikeDaveO

I agree. And if you’ve already paid more than your initial loan, you’re done. If people can’t discharge these loans in bankruptcy, there needs to be a very low cap on interest rates. If it’s not a risk to the lender, the rate can’t be high.


The_Woman_of_Gont

> > > If people can’t discharge these loans in bankruptcy, This is the big problem. I am absolutely shocked more people aren't talking about the importance of there being *some kind of way out* if you genuinely can't get pay off the debt. Bankruptcy exists specifically for the purpose of helping people out of debts they have no ability to pay off, and student loans being excluded from it has done *so much* to drive the problem we have today. No one would be lending tens of thousands of dollars to eighteen year olds with no means to pay it back, and tuitions wouldn't have ballooned they way they have if the average student wasn't pretty much guaranteed to easily get as much in loans as they can.


CGFROSTY

This is the much better solution (and more fair) than simply eliminating a predetermined number. Everyone should pay the principal they agreed to, but not be victim of the high interest rate.


polarparadoxical

And allow debt to be discharged again by bankruptcy - part of the reason why we are in this mess is they created a protected asset through SLABS that investors love as there is no potential risk.


Looks2MuchLikeDaveO

That’s what I don’t understand. How can you justify allowing high interest rates to be assessed when the risk to the lender isn’t there.


fish60

Turns out lenders have way better lobbyists than students.


jacklocke2342

I agree that $10,000 is arbitrary, but I don't believe anyone should have to pay tuition for a higher education in the first place. Congress should enact tuition free college, but in the meantime there should be a rolling jubilee to cancel all student debt.


Iceykitsune2

And return any negative balance you end up with.


docwyoming

Now THIS is a good idea. Seeing as I have already paid back more than I ever received, anyone who cried 'handout' could just go suck it.


Ngigilesnow

Can a president do that all alone?


MisterCremaster

If you have compounding interest then you unfortunately do not have a federal student loan and will likely not be included in this. All federal (and most private) student loans operate on simple interest.


gjp11

Honestly if u made me choose between the $10k and this I’d prob choose this. But hey $10k is $10k


LackingTact19

Public student loans don't have compounding interest, they use simple interest


orangeNgreen

Agreed. While I'm glad some people would get instant, noticeable relief, $10k forgiveness would knock off about 1/5 of my accrued interest to date, and I still would not have touched the principal.


Angry-Dragon-1331

For me it knocks off about 25% of my total loan debt. I’m sorry that it’s not a significant relief to you.


nola_mike

it completely removes all of my remaining student loan debt. Just so anyone is aware I graduated high school in 2001 and haven't been in college since 2006. This will be huge for a lot of people.


XAMdG

Yeah i think about for about 1/3 of all undergraduate loans is gonna be effectively a total loan forgiveness. It's really a huge deal


itshurleytime

It's going to cut more than half of borrowers debt in half. I'm sorry for your situation, that'd be a shitload of student debt, and unfortunately for you the impact isn't going to be as large as the median debtor.


SlipperyFrob

If you have significant outstanding interest, you're probably on an income-based plan with forgiveness in your future anyway.


blackcain

I think thats a great idea - I think reduce their debt and get rid of the interest. 8%? WTF - in the 90s it used to be only 1-2% We should go back to that.


SlipperyFrob

8% much higher than current interest rates: https://studentaid.gov/understand-aid/types/loans/interest-rates


ast01004

Mine is 7.8 percent. Graduated in 2010.


Blueheron77

Wish this applied to people who consolidated govt loans with a "private" loan company...


ATX_native

If they’re backed by the Feds it should.


TheGlassCat

Don't think the president can alter legal contracts between private entities.


cuzdeeznutz

*cries in 100k private student loans*


Kay312010

It’s better than what the other side is offering. The Republicans love their for profit university donors.


landsharkxx

I'll take it. $10k is $10k.


chowler

I've got less than 10k left and would love to see this happen. I've been kicking the can down the road hoping this would happen


ThaPhantom07

Same. I only have 4k left and have paid about 15k off over the years but any help is appreciated. I can finally remove student loans from my list of bills if they do this and thats satisfying to me.


blackcain

As long as they remove it from the principal of the loan, and not give it to you - otherwise, you'd get taxed.


No-Fall-1170

I believe Senator Warren included a provision in the American Rescue Plan that says that any student loans forgiven between now and 2024 will be tax free


jazwch01

Yep. They had a long term plan in place hoping for this to come to fruition.


whenimmadrinkin

As much as you can criticize Biden. This was planned out well. Planted this seed early on. Prepping for it along the way. And now deploying it when it can make the most political hay. I hate that the Democratic party has to play these games. But the republicans brought the discourse this low.


ImNotAWhaleBiologist

Probably waiting until September.


whenimmadrinkin

Yup my thoughts too. Dropping word on it now to stir up some activity before the primaries and then dropping it when it's best timed for campaigns.


jgjgleason

Good. No offense, but the way some people say he’s done nothing reinforces my belief even September may be too early. Seriously some people have the memory of Fucking gold fish. I guess the ARP and BIF are nothing?


scruggbug

When they go low, the high road no longer works. I’m sorry that’s the case, but it has become so.


CreativeCarbon

Excellent forethought.


The-Hater-Baconator

Canceled or forgiven it’s taxable, what would this classify as?


19mad95

The American Rescue Plan gets rid of the taxable nature of debt forgiveness in this case.


MR_COOL_ICE_

Same here, that's a little over half of what I have left


mckeitherson

As anyone in this sub should, since they've spent the last year or so asking for any kind of student debt relief. Anyone in this sub turning up their nose at 10k now is just trying to avoid saying Biden might deliver on his campaign promise or they're moving the goal posts.


altfactsarepeopletoo

Thanks Biden! Just saw an headline on cnbc implying I should be very upset because $10k is basically nothing. This is after months of headlines on cnbc and other corporate news implying the Democrats were insane for even considering cancelling any level of debt at all. Don't be fooled by corporate propaganda.


NorionV

When people try to tell me outlets like CNN or CNBC are 'leftist news outlets' I just don't have any response other than laughter.


Cicero912

10k is around 1/3-1/2 the total average debt of a college grad who takes on student debt. Anyone acting like its a truly insignificant amount has some ulterior motive.


StrangeBedfellows

All these arguments about compounding interest versus principle - it's still 10K you *wouldn't have to pay*. Yeah, it could ***absolutely*** be applied in different ways, but are you really going to argue against $10,000 of free money?


----------_______---

> are you really going to argue Have you met people?


lostharbor

I'd prefer not to.


The_God_King

There are dozens of comments in this very thread saying exactly that. In fact, the comment right above yours as I type this just syas "Don't bother." But I'm sure all those comments are totally genuine and in good faith. /s


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monstersammich

Progress


pm_me_your_last_pics

Good. I'd rather get a guaranteed $10k to evaporate then keep hoping for a maybe of $50k. Maybe I'm naïve because my loans only total $17k but I call this a massive win.


sirboddingtons

I'm starting to be a bit more into realism as well. This is a start and certainly more than we could have reasonably even bet upon. You certainly would not be seeing this from a Republican presidency, not even the mere mention let alone a looming potential result. 10k is a start to winding down some of these loans. Why yes, we can certainly do better, I'm still going to be happy for a cup of water even if I wanted a whole gallon after being out in the sun all day.


proudbakunkinman

They most likely would have also stopped the pause on repayments as soon as they regained power (had they won or were successful in a coup) in 2021.


asshat123

Is it guaranteed though? Biden has been saying this twice a month for his entire term. Still hasn't happened. I don't want to read anything else about what he might do or what he's planning to do or what he's thinking about doing. Tell me when he's done it, and I'll believe him. Until then, he shouldn't get any points for just saying he's thinking about it.


Ottersius

I've had the feeling they keep bringing it up to keep the public interested in it, but I think they'll wait until close to November to do it so it's fresh in voters minds.


pm_me_your_last_pics

This is the most promising it's been so far. Article states he was going to announce it this weekend but postponed it due to the Texas shooting


tomas_shugar

> Biden has been saying this twice a month for his entire term. [citation needed] The topic has been discussed by the admin, but very much in the context of "what can be done." This seems like a more solid and specific plan than before. I'm still waiting to see full movement, but I am also of the opinion that this is better served in congress than through executive action. **Spend** the political capital to make a real change, don't just hand wave away some debt.


ColeCT42

I will believe it if it happens


gideon513

It’s a start and show that it’s doable. Something to build off of.


lawbotamized

But realistically once this happens it won’t happen again. That’s why people who don’t think it’s enough are really worried.


mynamejulian

The best way we can guarantee a future where America keeps its world power while only making up 4% of the world population is if we educate our citizens as much as fucking possible. That way we'll stay ahead of the technology game which we are quickly on our way of losing as other nations are getting caught up. To do that, education must be free. We should encourage the living shit out of it.


geo_lib

Not even just for a world power, I just dropped out of NURSING school because the uni I was going to upped tuition by like 3 grand a semester and I wasn’t able to get a loan for it without having to go private which I just can’t do after seeing what that done to friends with private loans. How fucked that people want to go to school to directly serve and help communities like nursing, doctors, etc… and it costs SO MUCH FUCKING MONEY. Nobody will do it, there’s no fucking nurses anyway already.


mynamejulian

I'm sorry to hear that. That's a travesty. I can think of countless reasons for making education free which provides the best return on investment at the local levels as you described and on a national level while I can't think of a single, legitimate reason against it.


geo_lib

It’s said all the time but the reason it can’t be free is that if the public becomes more educated then the politicians (mostly republican) can’t keep getting away with their BS I’ll see if I can find it, but my husband loves reminding people that trump once said “I love the uneducated” but I don’t have a source for that rn lol


ltalix

Not sure why it is so hard for conservatives and other right-wingers to get this through their selfish thick skulls.


PM_ME_THA_WHOLE_TIDI

No, Republicans understand it quite well. They also realize that if people become more educated no one will be left to vote them into power.


ltalix

The politicians understand, absolutely. I'm referring to the average, every day right-wing voters.


Due_Distribution9193

I believe it when I see it


FunctionBuilt

While I will benefit from this, I still think you could satisfy a lot of people by making student loans cancelable by 5-10k a year forever by doing something like 100 hours of community service a year. Getting young people to volunteer within their community could be a huge boon and possibly improve the local economy. I’d have no problem doing one 8 hour day a month picking up trash or doing landscaping in parks or working in a food bank in exchange for cutting my repayment time in half.


MrOzzMN

Employers can pay up to $5,250 per year on an employees federal student loans per year up to 2025 or 26. Then the employee is not taxed on that, and neither is the employer. Also great for self employed people to use as a business expense.


fluxusisus

Is that then a write off for the business?


MrOzzMN

I’m not a CPA so I hope I say this correctly: For an employer absolutely a wage expense so they can deduct it from income. For self employed individuals, it can be an expense on the schedule C or schedule F only. No other schedules like RE, from my understanding, work.


broken-not-bent

So basically…. Start your own llc give yourself student loan relief …. profit


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Alphawolf55

A 10k tax credit would be even more generous lol $10k in student loan forgiveness, would reduce your payments over a 10 year period by 8,000 A tax credit, you could eliminate your income taxes for 2-3 years.


SparkIT9000

Except those hit hardest by the debt aren’t paying much in federal taxes. It just gifts those making more than enough to pay their loan while leaving the poor in the dust.


TomOgir

Unless it's a fully refundable credit. That would give the full amount back.


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KellyAnn3106

Only if they make it a refundable credit. It it's a non-refundable credit, the excess is just lost.


blue60007

Not all tax credits are fully refundable. You might not get the full credit if you don't have enough tax liability. You may be able to carry forward the remainder to the next year, but not necessarily the case. Also note that tax deductions only reduce your taxable income. A $10k tax deduction doesn't mean you get $10k off your tax bill (effectively the actual $ amount will be 10-20% of the deduction, or whatever your effective tax rate is). Deductions can also be beneficial if you would normally be above some cutoff for another tax benefit. A tax credit doesn't reduce your taxable income (so doesn't help you avoid any phase outs for other benefits) but is a straight $ credit on your tax bill. If it's refundable, then you can be owed money back.


Alphawolf55

Completely and utterly false on multiple levels. 1. The bottom 40% of earners, only pay 10% of the Student Loans each year. Because most bottom earners, have low payments due to IBR. The people who have high student loan payments, are those with mid-high level of income but high debt. Just as an example of income vs payments under IBR vs income taxes with 50k in debt $0 income-$0 yr - $0 tax $10k income-$0yr -$0 tax 20k income- $240 a year - $800 tax 30k income- $1440 a yesr - $2020 tax 40k income- $2640 a year- $3230 tax 50k income- $3840 a year- $4430 tax 60k imcome -$5040 a year- $6630 tax But the 10k forgiveness is worth less, cause the benefits are captured over decades vs tax credits which are immediate. 2. A tax credit would still increase your withholdings refund.


PleasantWay7

> Good chance it will be a 10k tax credit or some shit There is a zero percent chance of that. Biden doesn’t have the authority to create a tax credit through executive action. The broader question is if he forgives 10K, I’m guessing people will owe taxes on that 10K as if it were income because I’m not sure he can waive that part.


Terraneaux

He can't, but there's a law that was passed which says it csn't be if it's forgiven before 2024.


giantroboticcat

I mean if it's a tax credit, you don't have to pay income taxes on it. Debt forgiveness is taxable... so a tax credit would be better.


KellyAnn3106

One of the pandemic bills made student loan forgiveness non-taxable.


DoctorDruid

Debt forgiveness isn't always taxable. Currently no student loan debt relief is taxable until 2025.


Abracadabrx

Let’s make education free, ya?


ImAnIdeaMan

Elect more liberals. Edit: By liberal I mean anyone left of center.


hooch

Totally. Baby steps first.


Whiskey_Maker

Just get rid of interest


TheGlassCat

I don't think that's in the president's power, except in emergency circumstances. The emergency is over. He can only do what he's allowed to do.


BettyVonButtpants

Yeah, only congress can adjust the interest rate, and I doubt Manchin or Sinema would support anything good for America.


thatnameagain

I guarantee absolutely EVERYBODY WILL BE MAD AT HIM FOR THIS, especially the people here who have been demanding student loan forgiveness.


Brosephus_Rex

I would be very happy - easily the most impactful thing any elected official has done for me in my lifetime.


Deceptiveideas

Oh boy, can't wait for Reddit to move the goal posts on how Biden is doing nothing.


silentassassin82

I'm sure the people making over $150k will be complaining about how unfair it is and how much they're struggling with their 6 figure salary


darkera

I don’t think they should put a salary cap for who gets it, and this should include zeroing out the interest. I paid my loans off, but it’s not a burden so many should face.


Victor_Korchnoi

It’s mean tested, but the threshold is higher than usual (300k matured filling jointly). I made too much to get a stimmy, but not too much for this.


HereForTwinkies

Jesus, I swear some of the people complaining about $10k not being enough are the same people who said $10k would be at least something Biden could do


DrDokter518

Well I can’t wait until my income driven repayment plan doesn’t keep up with interest and builds that 10k back up in a few years………


Aron-Nimzowitsch

If you're on IDR then your entire loan will be forgiven after 20 years of payments


AmerikanInfidel

Mines 10 years or 120 qualifying payments


Elseiver

This is theoretically true, but the actual reality behind those words is important to recognize. Its not written in statute as "20/25 years of repayment", its more like "240/300 on-time payments in sequence", which opens the door for servicers to game things and keep you on the hook forever by losing your income certification and bumping you onto the standard plan for a month, rendering your payment for that month insufficient and resetting that timer. I know this cause my forgiveness date keeps resetting to ~25 years in the future whenever they frig up the income certification process, which in my experience in student loan servicer ecosystem is usually about once every five years, or whenever the servicing contract gets reassigned to a new company. If I'm lucky I'll be able to get out of em somehow before I retire XD


Cruizin4aDoozin

Pretty sure that event is taxable.


SlipperyFrob

Not if it's in the next few years, but yes.


snerdaferda

So if you managed to graduate 20 years ago you’re good but to all the young people out there getting beat down by their loans and a market in which they’ll never afford a house: have fun with the tax bomb if you should manage to get ahead 20 years from now!


cloudedknife

25 iirc, also pretty sure the foregiven debt counts as income for that tax year. I did the math once - assuming you paid nothing because you soent the 25years completley broke, the tax burden on the final balance would be about equal to the original borrowed balance. If you made payments but they were less than accruing principal, no significant difference when factoring what you paid - perhaps actually worse.


SlipperyFrob

20 versus 25 depends on the plan. For PAYE, which is basically the best plan and one that most people qualify for, it's 20.


beargrimzly

But... If you're on an IDR you're on track for full forgiveness. I don't know what more you want from this considering that up to this point we were all expecting nothing. Pretending like this isn't a good thing is a surefire way to convince moderates that they shouldn't ever bother even trying to appease you.


TheGlassCat

I bet that if I gave you a horse, you'd immediately check its teeth.


froggystyle66

I’ve already paid all the interest since it’s front loaded. Would be great if the adjusted principle resulted in retroactive recalculation of interest resulting in a credit for excess interest paid. Doubt it though


Scarlettail

This is what he promised in his campaign. Those asking for more are getting way ahead of themselves. A full, blanket cancellation was never promised.


nemocluecrj

Don't worry, they're going to find a way to move the goalposts and still not show up in November even when he carries through on his campaign promise.


mckeitherson

100% truth based on the comments in this sub. R / politics spent every day the past year complaining about no student debt forgiveness and how they'd be so happy any forgiveness was passed even if they didn't truly benefit. Now that some forgiveness is on the cusp, the sub has moved the goalposts and complained it's not 50k or full forgiveness to explain why they still won't vote for him.


Ihateredditadmins1

Well idk about that. It’s just people on Reddit talking. We should all be aware that the Reddit crowd is insignificant.


CatatonicTaterTot

I have exactly $9400 in loans. I just graduated last week. This is fantastic.


DynastySS

You know when that spoiled kid throws a tantrum at Christmas because he didn't get a brand new Xbox but instead got a gift card worth 1/3 of one? That is this thread.


FridgesArePeopleToo

"Democrats only gave me $10k. I'm never voting again!"


moonfox1000

The cynicism of reddit drives me crazy. This is what they wanted, they get it, and they're immediately unsatisfied. Loans have been on pause for two years now, that by itself is equivalent to tens of thousands of dollars in saved interest payments for many people.


southsideblox

Online trolls (of the foreign or domestic variety) identified student loans as a wedge issue of the left and strive to use it to divide. Whatever actually happens, the goal is the push outrage. A lot of what goes on in this sub is not organic.


Encouragedissent

A lot of redditors are well off tech workers who wanted $10k but dont in the slightest NEED the $10k. The $150k/300k cut off means some of them might not get that free money. You can see it in the comments here like, "what about high cost of living huh?" Sorry but there isnt a single place in this country where a single person cannot live decently on that wage. You can live in a 2 bedroom apartment and drive a nice car while living comfortably in Santa Monica with those wages. If youre a family with $300k + you can easily afford $1m+ houses. This income cap makes what was already a really regressive bill a little bit less regressive at least.


cluckinho

Lol. This thread is SO divisive. Some love 10k, some scoff at it, and some say why the hell are we forgiving ANYTHING.


Elestra_

This thread has legitimately tarnished any semblance I had of being "Okay" with some level of forgiveness. They sound like children whining that they aren't being given the single largest handout in US history.


LorenWard

I don't think we qualify for this but it would change so many lives for the better. Next step is to tackle college tuition so we don't end up right back in the same place.


Sarcosmonaut

Yeah that’s my core concern. I don’t want my Childrens’ generation to have the same problem mine did, overall when it comes to education. That being said, I do wonder how they’ll calculate it for married single income families


kwhicks

does that go off last years tax record?


BarkWoof

I mean, it's right in the article. >Biden's latest loan forgiveness plan include $10,000 in relief for federal borrowers who make under $150,000 **in the previous year**, or less than $300,000 for married couples who filed jointly.


Modernusername

Redditors want to know, what is this article you speak of? /s


KevinadianBacon

LOL at all of the bitching about how this isn't enough. You know how much I got cancelled? Zero. Take the goddamn win.


seymourputts

Going to see a lot of people upset someone gave them $10k because it's not enough to pay off all their loans. Crazy.


AssassinAragorn

Don't forget all the podcasters who make millions and are going to complain too.


wipeoffthethrowaway

Nice I have right under 10K, please delete it sir appreciate it


Warm_Gur8832

This is, I guess, their way of confirming the plan to restart payments in August. What I don’t understand is what’s stopping them from just putting them on pause forever? Politically, it’s implausible to forgive everything. But they’ve been on pause for the last 2 and a half years and life continues. There’s no representation of younger working and middle class folks in this country. Just complete alienation.


proudbakunkinman

The WH followed up this morning to say this isn't a done deal (after these articles started trending on Reddit unfortunately). Someone jumped the gun with the press or sucks with their wording. Just based on political strategy given the upcoming mid-terms, it seems like the safest bet is to extend the repayment pause until the end of the year, even if $10k is forgiven. Either "we're extending repayments through the end of the year and we are trying to work out a plan for some forgiveness still" or "We're forgiving $10k for now and will extend the pause on repayments through the end of the year. If you would like to see bigger changes in regards to college costs and loans and other issues students face, most of that has to be done through congress, so please vote for more Democrats to improve the chances of that."


Okbuddyliberals

> What I don’t understand is what’s stopping them from just putting them on pause forever? That could screw the college market up in the longer term >There’s no representation of younger working and middle class folks in this country. Young people consistently have the lowest turnout of any generations, young people could change that


Bored_guy_in_dc

Great, an expensive band-aid. This does nothing to solve the core issue. Tuition is out of control, and legislation needs to be passed to reign it in. This only helps a few folks, and does NOTHING for future students.


CaptainNoBoat

Which is why midterms and Congress are so important. Legislation is the only thing that can offer substantial, long-term solutions to this problem. And Republicans are currently voting to reinstate debt and want to eliminate any sort of assistance to higher education.


hurlcarl

Yeah, a president can only offer band-aids with all executive orders... real change has to come from Congress and Congress is absolutely worthless.


hellomondays

The president can't do anything about that unilaterally like he can with federal student loans. Good thing many in congress in state governments have written bills on the issues you're worried about


TheGlassCat

Vote for Democratic Senators if you want big changes. The president is only allowed to do certain things.


Beautiful-Musk-Ox

The AOC camp is harping on Biden weekly for not writing EO's about student loan debt, a presidential bandaid is all we can do, Congress ain't doing shit and the left wing blames the president daily.


jpk195

You know the thing about band-aids? People use them for a reason. You don't go to the hospital and get the option for either treatment or relief. You get both. There's nothing about this step that prevents more steps.


swaggman75

Thats not his wheelhouse. He could definitely cancel debt but setting regs for loans is fully on congress