Student Loan Borrowers Dread ‘Financial Cliff,’ Want Biden to Extend Relief

I’m a skeptic when it comes to surveys, especially when those surveyed have a vested interest in the results as do those conducting the survey. Here is a great example.

What would you expect these folks to say? Just incredible.

A new survey of 23,845 federal student loan borrowers conducted in June shows that an alarming 90% aren’t prepared to pay student loans when COVID-19 pandemic student loan relief ends on September 30, 2021. Student Debt Crisis, the nation’s largest student loan debt advocacy organization, conducted the survey along with SAVI, a social impact technology company working to help solve the student debt crisis.

Both organizations are advocating for President Joe Biden to extend student loan relief beyond the end of September. Student Debt Crisis said student loan borrowers were already struggling before the COVID-19 pandemic, but now they face additional hardships caused by the health and economic crisis. They say millions of people will face a financial cliff if relief for federal student loans expires September 30.

“Our third Student Debt COVID-19 survey proves that pandemic relief for student loan borrowers remains critical to the wellbeing of millions of families. Even with an economic recovery picking up steam, many Americans still shoulder the economic harm caused by the pandemic. A large majority of respondents say they are not ready to resume student loan payments in October when relief is set to end,” said Student Debt Crisis Executive Director Natalia Abrams.

Repayment pause ‘critical’ to financial wellbeing. According to the survey:

9 in 10 borrowers are not ready to begin payments again on October 1.

65% of respondents say they are not ready to resume payments until September 2022 or do not know when they will be ready again.

80% of borrowers say they currently depend on COVID-19 relief for federal student loans and

75% say that the payment pause is critical to their financial wellbeing. Nearly one-third of borrowers will have more than a quarter of their income go to student loans if payments resume on October 1.

Only 26% of borrowers rated their financial wellness as “poor” or “very poor” before the pandemic began in March 2020, today that number has increased to 43%.

75% of women said federal student loan relief was the most important government support they received during the pandemic.

Source: Student Loan Borrowers Dread ‘Financial Cliff,’ Want Biden to Extend Relief – 401K Specialist

3 comments

  1. While I can’t quote a survey off the top of my head to support whether others agreed with me on this, I always thought what was “integral to my financial well-being” was to have a job.

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  2. Like most surveys, the numbers don’t make sense. I say that 9 out 10 borrowers were unable, unwilling, or never planned to pay the loans back BEFORE the pandemic. I think that the student borrowers have been hearing that they won’t have to payback their loans for over a decade now, that they truly believe that they never will and spend their money on other things accordingly. Even if accept the results as true fact, 57% do not consider themselves poor so why can’t 6 out of 10 borrowers pay back their loans?

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