Managing back-to-school expenses and student loans

FARMINGTON HILLS, MI (August 13, 2021) — School districts across the nation are working to safely open schools for the 2021-2022 academic year. The National Retail Federation says back-to-school spending is expected to reach a record $37.1 billion and back-to-college spending is expected to reach a record $71 billion[1].

GreenPath Financial Wellness, a national nonprofit focused on financial health, encourages families to start early researching store offers, coupons and online sales, as there may be fewer deals due to shortages resulting from global shipping delays. Take inventory of what supplies your child may already have. Plan your spending and stick to the budget. Consider what items are needed now and what can be purchased later. Utilize the child tax credit and other forms of COVID relief to help with school expenses. Check out the dollar store or clearance sections among retailers for supplies and clothing. Shop during designated tax-free times, if your state allows it. See if your school district, local companies, or nonprofits are providing free backpacks and school supplies, internet access and laptops, school lunch pickup and other services.

Back-to-school is an ideal time to help kids understand finances and savings. Have your child use a clear jar to save. Split up the piggy bank to teach the “Save and Spend” approach. Get your teen on a simple budget and set up a bank account for him/her. Review the back-to-school shopping list with your child, so you can discuss wants versus needs. Have kids chip in from their allowance to cover a school expense.

“There are many concerns for parents as children head back to school, primarily their safety and wellbeing,” said GreenPath Financial Wellness CEO Kristen Holt. “Parents must also figure out how to pay for school expenses which may be more expensive than in past years. Having a plan-of-action will help parents feel more in control. GreenPath counselors can look at the household’s financial picture and help develop a customized plan to tackle school expenses and student loans.”

As borrowers have been allotted breathing room since March 2020, student loan debt relief extensions have been a moving target. Recently, the U.S. Department of Education announced a final extension on the pause of federal student loan repayment, interest and collections until January 31, 2022. GreenPath encourages borrowers to plan how they will resume student loan payments.

Take a hard look at your budget

If you were paying $400 a month for your student loans pre-pandemic, will you have that $400 in February 2022 for payments and each month thereafter? Becoming delinquent or failing to repay a student loan can have serious financial consequences for borrowers, including collection fees, wage garnishment and money being withheld from income tax refunds, Social Security, and other federal payments. Carefully examine your income and all expenses such as medicine, food, housing, childcare, and other debts (such as credit cards and car loans) to determine how much discretionary income can be used for student loan payments.

Investigate other forms of relief

In addition to this latest extension, the U.S. Department of Education is “reinstating 1.3 billion in loan discharges for 41,000 borrowers who received a total and permanent disability discharge and protecting another 190,000 from potential loan reinstatement.”  If you are on a forgiveness plan, like public service loan forgiveness, the months when the borrower’s payments were paused still count towards their forgiveness (for Public Service, it’s 10 years (120 months) of work/payments). You might be able to request economic hardship deferment, unemployment deferment, and disaster or emergency forbearance. Borrowers with private loans should contact their lender promptly to inquire about available options.

Continue paying if you can

There are several reasons to continue paying student loans during the pause. You can reduce your balance and pay off the loan faster by making payments while your student loan is not accruing interest and your full payment will be applied to the principal amount of your loan. By paying a little more than your required monthly payment amount, you can significantly lower what you pay over the life of the loan. A lower balance reduces the amount of interest the borrower will pay over the long term.

Holt added: “Now is the time to examine one’s financial picture and figure out how to set aside funds for repayment of paused payments once temporary relief ends.  Focus now on affordability and take steps to avoid defaulting on your student debt. GreenPath can help bridge the gap between you and the lender, and help you identify solutions that will work best for your specific financial situation.”

Anyone concerned about managing back-to-school expenses and student loans should contact GreenPath at 866-648-8122 or visit Initial student loan counseling is free as part of GreenPath’s counseling services.


About GreenPath Financial Wellness

As one of the largest financial counseling agencies in the nation, for more than 60 years, GreenPath Financial Wellness has assisted millions of people with debt and credit management, student loans, homeownership, and foreclosure prevention. Headquartered in Michigan, GreenPath and its affiliates work directly with individuals and 580+ credit union, bank, retirement/insurance and employer partners across the U.S. from more than 20 locations and through phone access and online tools. GreenPath is a member of the National Foundation for Credit Counseling and is accredited by the Council on Accreditation. The GreenPath family of companies now include CONSUMER, Homeownership Preservation Foundation (995-HOPE), Clarifi, and Rural Dynamics, Inc. To learn more, visit or call 800-550-1961. Follow the nonprofit on Facebook and Instagram @greenpathfinancial and on Twitter @GreenPath.


Taevann Calloway; Marketing Clerk
Dover Federal Credit Union
1075 Silver Lake Blvd.
Dover, DE 19904
302-678-8000 ext. 2432

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