Borrowers are making lifestyle changes in order to afford their payments again now that the federal student loan pause has ended.
Among Americans with student loan debt, 80% say they have reduced their spending due to their debt, according to poll results released Tuesday by MassMutual. Just over half of the surveyed borrowers say they have cut back on eating out to make their student loan payments. They’ve also come up with money for their student loan bills by reducing their spending on luxuries (a tactic used by 44% of respondents), limiting everyday spending (39%) and curbing essential purchases (37%).
In addition to payments being suspended, interest did not accrue on federal student loans from March 2020 to September 2023. The first bills after the pause finished were due in October, which means many borrowers have now paid their federal student loans twice since the policy expired.
As borrowers try to fit the payments into their budgets for the first time in over three years, the MassMutual survey shows many are taking a hit financially. About three-quarters of Americans with student loans say the payment restart has had a “negative impact on their day-to-day financial health.”
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