What Student Loan Borrowers Should Know About the SAVE Plan Pause

If you’re among the eight million borrowers enrolled in the Saving on a Valuable Education (SAVE) student loan repayment plan, you’re likely wondering what’s next for your loans. Since the Trump administration, student loan policies have seen numerous shifts, including changes to Public Service Loan Forgiveness (PSLF) eligibility and efforts to restart collections on defaulted loans. However, for now, payments under the SAVE plan remain paused under a general forbearance, with no interest accruing.

This pause means borrowers are not making progress toward loan forgiveness programs like PSLF during the forbearance period. While switching to alternative repayment plans is possible, experts generally advise waiting it out. The Department of Education indicates that the forbearance will last at least until fall 2025, with some experts predicting it could extend into mid-to-late 2026.

What Should PSLF Borrowers Do?

Public servants pursuing PSLF face a dilemma: the paused payments don’t count toward the 120-payment forgiveness requirement. They have three options:

• Switch to another income-driven repayment plan like ICR, IBR, or PAYE to resume counting payments toward PSLF.
• Use the PSLF Buyback program to make a lump-sum payment for months spent in forbearance, ensuring those months count toward forgiveness.
• Wait until the forbearance ends and a new payment plan is established, especially if you are far from forgiveness or recently enrolled.

Each option has trade-offs, including processing delays and potential higher payments later, so borrowers should align decisions with their financial goals.

How to Prepare During the Forbearance

Even though payments are paused, this is not a time to be complacent. Borrowers should:

• Use the Federal Student Aid Loan Simulator to estimate future payments under different plans.
• Avoid collections and wage garnishments by maintaining enrollment in the SAVE plan.
• Focus on improving overall financial health by paying down other debts, building emergency funds, and contributing to retirement accounts.

Consider setting aside the amount you would normally pay on your student loans into a high-yield savings account to build a financial cushion.

By proactively preparing now, borrowers can ease the transition when payments resume and avoid financial surprises.