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Federal student loan interest accrues again
Federal student loans begin accruing interest again Friday, Sept. 1, with payments to resume in October.
MILWAUKEE - Federal student loans begin accruing interest again Friday, Sept. 1, with payments to resume in October.
A University of Wisconsin-Milwaukee professor said if you haven't already, it's time to review your budget.
"The biggest thing I would say is just don't ignore it, right?" said Rebecca Neumann, UWM. "Don't just say, 'OK. I don't have to make any payments. I'm gonna just pretend like I never took out these loans.'"
Neumann teaches personal finance at UWM.
"I am always talking about student loans," said Neumann.
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She said she expects two types of borrowers to be affected by this more than others: First, those who began making payments and then paused during the coronavirus pandemic, and second,- those who graduated during the pause.
"They came out. They haven't had to make a payment," said Neumann. "Interest has not accrued. Now, suddenly, that's going to hit."
She said with payments resuming in October, it's time to plan now.
"It's always been in the back of my head," said Sarah Speer. "We have just been trying to budget for it and thinking like, 'How is this gonna affect things that we're planning for?'"
Preparing for her senior year at UWM, Ahjae Moore said she's already thinking about how to pay off her debt after getting her degree.
"To not have interest, it feels the same as having it," said Moore. "I mean, I think about it when I do my spending day to day. I try to keep it in mind when I pick classes."
Neumann said your loan servicer should reach out to you directly with information on how much you owe and what your payment will be.
The federal student loan office also has resources available online.