Many people whose earnings were hit hard by the pandemic are now under a new burden.
By Isvett Verde Staff Editor, Opinion |
Ballooning student debt was a concern for many borrowers even before the coronavirus emergency. |
In the fall of 2018, I remember meeting with a dear friend and brainstorming about ways to get her out of the debt hole she was in. She took on student loans to attend graduate school nearly a decade earlier, and although she paid consistently since graduating, the balance she owed had swelled far higher than the amount she originally borrowed. |
She briefly considered giving up her apartment and living on a boat. But in the end, she accepted a job teaching overseas a month before the pandemic hit. She'd make just about the same amount of money she did in New York, but the cost of living would be lower, and she'd get a living stipend, which would allow her to put the rest of her salary toward her debt. |
The pandemic brought much-needed, albeit temporary, relief for borrowers like her. For a moment, it even seemed that relief might become a permanent reality. That is, until the Supreme Court struck down President Biden's student loan forgiveness plan. His administration is now working toward a new plan, but in the meantime the student loan payments people were spared from over the past three years are now coming due. |
The trouble is that economic hardship brought on by the pandemic, including a spike in unemployment, has left some in even more precarious financial situations than before. Yarimar Bonilla, a contributing writer for Times Opinion, also has a friend who took on student loan debt. In a guest essay, she notes that before the pandemic, he was earning close to six figures and had even built up some savings. |
Because his work was deemed essential, he was called back even as many of us were still wiping down our groceries. Yet because his salary was based on commission, his pay took a hit. In many ways, he is now worse off than when the pandemic started. "He cannot even begin to fathom what he's going to do now that the moratorium on student loan payments is over and he has to pay them — with interest — again," Yarimar writes. |
Yarimar thought of him when she learned her own loans had been forgiven under the expansion of the Public Service Loan Forgiveness program. "I had done everything 'right': borrowed responsibly, paid diligently and consolidated during historically low interest rates," she writes. And yet she realized that by the time her loans were forgiven as part of the program, she had already paid more than she originally borrowed. |
"While I'm grateful for the program that canceled my debt, I'm troubled that it is so selective," Yarimar writes. "Why should low-income students, reliant on financial aid for college, be burdened with a lifetime of debt? And what about those who sacrificed during the pandemic, seeing their paychecks evaporate and their debt balloon?" |
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