The Indicator from Planet Money
The Indicator from Planet Money

What you should know about your student loans

June 29, 2026

AI Summary

5 min read

On July 1st, the biggest overhaul to the federal student loan system in decades takes effect, affecting roughly 43 million borrowers. The changes, embedded in the Republican-led "One Big Beautiful Bill Act," phase out the Biden-era SAVE plan, cap graduate borrowing, and create new repayment options that are less generous and less flexible than what many borrowers have grown accustomed to over the past several years.

The end of SAVE and the repayment reset

The most immediate change involves the roughly seven million borrowers still enrolled in the Biden administration's SAVE repayment plan, which launched in 2023 but was frozen by lawsuits from Republican-led states arguing it was federal overreach. Starting July 1st, those borrowers must choose a new repayment plan within roughly 90 days. If they do nothing, they will be automatically placed into the least generous, least flexible standard plan available.

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What you'll learn

  • 1 (00:07) **Student Loan Debt Landscape** - Adrian Ma introduces student loans as the third-largest consumer debt category, with 43 million federal borrowers facing major changes on July 1st.
  • 2 (02:34) **End of the SAVE Repayment Plan** - Cory explains that the Biden-era SAVE plan is being eliminated after legal challenges from Republican-led states.
  • 3 (03:45) **Two New Repayment Plans Introduced** - Starting July 1st, only two repayment plans will be available for new borrowers.
  • 4 (04:03) **Graduate Student Loan Cap** - New limits on graduate borrowing: $20,500 per year, except for medical, clinical psychology, or dentistry degrees.
  • 5 (04:27) **Goals of the Overhaul** - Two main purposes: saving money for the tax bill and restarting federal student loan repayment after COVID-era disruptions.
  • 6 (06:13) **Expected Impact on Borrowers** - The new plan is less flexible and less generous than SAVE, with higher monthly payments.
  • 7 (07:23) **Student Loan Forgiveness Programs** - Public Service Loan Forgiveness (PSLF) remains intact, but other forgiveness options are changing.

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Guests on this episode

Corey Turner

Show Notes

For many of the 43 million Americans with federal student loans, July 1 is a day to mark on the calendar. Trump’s One Big Beautiful Bill Act is introducing stricter borrowing caps and new repayment plans. Today on the show, we talk with NPR’s Education Reporter Cory Turner about the impact.

Fact checking by Sierra Juarez.

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