The SAVE Plan Is Dead. Here Is Your 90-Day Playbook.

Derek Wu: Hey, everyone. Welcome back to Coin Flip. Thanks for making a little space in your day to think about money you probably wish you could ignore. And today, that wish-I-could-ignore-it energy is all about student loans. The important thing to understand is that the SAVE repayment plan is ending, balances have been quietly growing during forbearance, and a new 90-day decision window kicks off July 1. So if your inbox looks like a wall of scary loan emails, this episode is basically the translation guide. Here is the setup in plain English: for a while, payments were paused, interest rules changed, and a lot of people just stopped looking. Now the pause is ending, the rules are changing again, and you have a short clock to choose your next move. Ignore it, and someone else makes that choice for you. In the first segment, we lay out the context, what exactly ended with SAVE, why your balance might be higher even though you haven't paid in years. And what that July 1 start to the 90-day window really means. Think about it this way. This is like your lease renewal notice. If you do nothing, you did make a choice. You just made it by default. Calm and clear, we move to risk and consequences. What happens if you let that 90-day window pass? How you can get pushed into the Standard Repayment Plan, what that does to your monthly bill, and missing payments can spill into your credit and your day-to-day life. Not to scare you, but to give you enough detail so those emails go from, I don't want to look at this, to okay, I know what this means. After that, we build a simple decision framework. No alphabet soup, just a clean tree between IBR, the upcoming RAP program, and the plain old standard plan based on three things: your income, your job, and how big your balance is. You'll hear a concrete RAP payment example and why new loans can quietly drag everything into RAP if you're not paying attention. Practical? Then we finish with a tight check list; three steps you can take before July one, even if you only have twenty minutes and you're tired of thinking about this stuff. We will talk about logging into studentaid.gov without getting lost, using the loan simulator without a spreadsheet and what to say when you call your servicer and the numbers still feel impossible. Here's why this matters: doing something imperfect this week usually beats doing nothing perfectly for three months. So grab your coffee, maybe open your loan account in another tab and stay with me. Now, let's start with the context, and make this ninety-day window feel a lot less mysterious. So your Inbox exploded with a scary-looking student loan email, and your first thought was, did I miss something huge? You did not. The system changed under your feet. Here's the thing. The SAVE repayment plan is gone as of March 2026 after a court-approved settlement. That plan covered around 7.5 million people, so if you feel like you just got swept into a giant policy storm, you did. Think about it this way. You were told, Hey, pause here. We'll sort it out. Since July 2024, SAVE borrowers have been in forbearance with no required payments. That sounded like a full stop, but there was a quiet twist. Interest started building again around August 2025. So on paper, you owed nothing each month, yet your balance has been slowly creeping up in the background. Does that make sense? I once had a client spend four months comparing two index funds whose fee difference was about $12 a year. Meanwhile, the market kept moving without him. That is what this moment feels like for a lot of borrowers. Huge energy going into confusion while the meter quietly runs. Now let's consider what actually hit your inbox. The Department of Education is running a two-step email process for everyone who was in SAVE. Step one is what you just got, a heads-up that SAVE has ended and you'll need a new plan. The next thing to understand is the real clock has not started yet, but is coming. On July 1, a formal notice starts a 90-day deadline for you to pick a new repayment plan or be moved for you. So today is not about panicking. Today is about knowing three facts. The old plan is gone, interest has been quietly growing, and a fixed window is coming where you have to make a decision. The important thing to understand is that ignoring those emails is a choice too, and it has a cost. The question is, what happens if you do nothing and just let that 90 day clock run out? With that in mind, I want to talk about the thing nobody likes to picture. What happens if you just ignore all of this? Think of it this way. Your loans are like a subscription you forgot you had, except this one can wreck your credit and your paycheck if you let it drift. Here's the rule the Department of Education has laid out. If you do nothing within that 90-day window, your servicer doesn't leave you in limbo. They drop you into the Standard Repayment Plan. Under that plan, they take your full balance, spread it over a fixed term and bill you a set amount every month. No income adjustment, no I had a rough year setting, just a straight math problem. For a lot of you who were on SAVE with a zero payment, this is the whiplash. You go from paying nothing to a flat bill that might be a few hundred dollars a month, literally overnight. Picture your budget. Rent, groceries, phone, maybe daycare, already tight. Now add what looks like another car payment, except you don't get a car. So what if you just don't pay it? Pause. After about three months of missed payments, the government treats you as delinquent. Delinquent means late fees, collection calls, stress. But if that keeps going and you cross roughly nine months of non-payment, the loan is in default. Default is where the damage really shows up. NerdWallet's Kate Wood told PBS that when federal student loans default, people can see their credit scores drop by hundreds of points. A three-digit drop is the difference between approved with a decent rate and sorry you don't qualify when you apply for a mortgage or car loan. It can also make landlords nervous, raise your insurance costs, and box you out of some jobs that check. Check Credit You might have heard that wage garnishment on defaulted federal student loans is paused right now. That's true at the moment, but it's a pause, not a permanent protection. The law still allows the government to garnish wages, grab tax refunds, and take some Social Security in default. Policy can change faster than your credit can heal. So the key insight here is that doing nothing is still a decision. It's choosing the Standard Plan by default plus taking on the risk of delinquency and default. If that sounds heavy, good, it should feel serious, but it doesn't have to feel. Feel hopeless. There are real ways to match your payment to your income, protect your credit, and still move your life forward. And that ties into something else, how you choose between an income-based plan, the new repayment assistance plan, and just staying with that standard schedule. After the break, I am going to give you a simple filter so you can say, given my job, my income and my balance, here is the plan that probably fits me best and move on with your life. With that in mind, let's make this way simpler than the headlines do. Think about it this way. You are basically choosing between three personalities for your loans. Income-based now, income-based later, or just pay the thing off like a car loan. Start with one question. Do you work in government, a public school, a qualified nonprofit, or anything you think might count as public service? If the answer is yes, your main goal is still Public Service Loan Forgiveness. The key insight here is you want to be on an income-driven plan that keeps those PSLF years ticking. Right now, that probably means switching into IBR while you wait for RAP to launch. Then once RAP is live, you can run the numbers and decide whether to stay on IBR or move, but either way you stay income-driven so PSLF keeps working. If that's you, the decision tree is almost boring. Income-driven now, income-driven later keeps certifying your employment. Done. Now flip that on its head. Say you have a solid income, the balance is relatively small, and you are not aiming for PSLF. The so-called Scary Standard Plan might actually be the cheapest move overall. because it just crushes the balance over ten years and you're done. Here's the thing. High earners often make the big mistake of stretching the debt for decades on an income plan just to get a tiny bit of forgiveness 25 or 30 years from now. Often, the math says pay it off and move on with your life. Now, most people listening are somewhere in the middle. Maybe your income is modest and the balance feels huge. For you, the choice is usually between IBR right now and RAP once it exists. And here's where the RAP rules really matter. Under RAP, payments are a sliding percentage of your adjusted gross income, roughly between 1 and 10 percent, with at least $10 due each month. Take a simple case. Single borrower, about $50,000 of income. Under RAP, they would pay around 5% of income per year, which works out to about $208 a month. Two key RAP features: your balance can never grow because unpaid interest is wiped and at least $50 a month has to hit principal. So the debt moves the right direction even in bad years. The trade-off is time. Forgiveness kicks in around year 30, instead of the shorter timeline you see on some current IBR setup. setups. So if your income is low and the balance is big, a simple play is apply for IBR now to keep payments tied to income during the transition. Then compare what RAP would charge you using one of the new calculators. One critical trap here, and I really want you to hear this. If you take out even one new federal loan after RAP launches, all your existing loans are dragged into RAP 2. That can be good or bad depending on your situation, but it is automatic. So this week, your homework is to mentally slot yourself – public service aiming at PSLF, high income with low balance, or low income with high balance. That label tells you whether to lean toward IBR. RAP OR STANDARD In the next part, I'll turn that label into concrete steps on your account so this moves from "Someday" to "Done by Friday." With that in mind, I want to end on three moves to make before July one. Think of this as your student loan checklist, not your new personality. Step one today. Log in to studentaid.gov. Confirm your servicer, your current plan, and your contact info. There are already hundreds of thousands of repayment applications piled up, so the people who move first are in the front of the line. Step two, open the Federal Student Aid Loan Simulator on the same site. Run your numbers for IBR, for REPAY, and for the Standard plan you decided about earlier. Ask yourself, Which payment looks livable for the next year, not perfect for the next twenty? If your last tax return is way off from what you earn now, use pay stubs instead when you submit income. That can get you a payment that actually matches your real life. Step three: If every option still feels impossible, talk to your servicer before you disappear. Say, "Walk me through forbearance or deferment and what that does to interest." Going silent is the one move that turns a headache into a Speaker 2: crisis. Derek Wu: To a crisis." I learned this the hard way when I did nothing about my own money for two years. Doing nothing was the most expensive strategy I ever tried. So pull up your account, make your best call with the info you have, and then move on with your life. The clock is running. Speed beats perfection here. So if your inbox just exploded with those savvy mails and you felt that little spike of panic, remember what we said earlier: you did not miss some giant secret deadline. The rules shifted under your feet. Think about it this way. You were in a no-payment season while interest quietly crept up in the background. Now, July 1 is the moment the system asks you very directly, okay, what do you want to do next? Here's the one sentence takeaway. Doing nothing is still a decision, and with this 90-day window, that decision usually means getting dropped into a plan that was never built around your life. So the key insight here is simple. Open the email, log in once, make one choice. It doesn't have to be perfect, it just has to be intentional. If you want a quick checklist from today, here it is. First, log in to studentaid.gov before that July clock starts. Second, run your numbers through the loan simulator with your current income, not the income you wish you had. And third, if the number on the screen feels impossible, that's not a moral failure. Call your servicer, ask about income-based options, and buy yourself some breathing room instead of letting the system guess for you. Remember my line about speed beating precision when the stakes are low? This is one of those moments. A decent plan you pick this month usually beats a perfect plan you never quite get around to. If you already made a choice while listening today, that counts as a win. Seriously, you just turned an anxiety loop into a INTRO a completed task. Here's the thing, most money decisions are boring, and that's fine. Boring is where progress lives. You make a call, you move on. On with your life, you go do literally anything more fun than reading PDFs. If you want more help on the next fork in the road, hit subscribe so these episodes are waiting for you when the rules change again. Playful. Got a money choice you're stuck on right now? Drop it in a review. Tell me the two options you're torn between and I might Flip a Coin on it in a future episode and then walk through the logic behind each side. Thank you for spending part of your day with me. I know student loans are not easy. Not anyone's idea of fun audio. So the fact that you stuck around tells me you are taking your future seriously. Think about this episode as you taking back a little bit of control from a very messy system. One login, one plan, one less thing hanging over your head. That's it for this episode of Coin Flip. Take care of yourself, make one small move before July 1st, and I'll talk to you next time.