Everything You Need to Know About Student Loans

Show Notes

• Guest: Amy Lins, Zina Kumok, and Adam Minsky
• Host: Adam Walker
• Publication Date: March 26, 2024

Highlights

1:51 | The panel of experts talk about the issues student loan borrowers have faced since the payment pause ended.

4:38 | Zina, Adam, and Amy talk about the benefits of the new SAVE plan.

7:50 | Amy and Adam explain the new forgiveness options being developed by the Biden administration.

14:13 | Adam provides an explanation for where student loan forgiveness currently stands.

26:17 | The experts discuss the most misunderstood elements of student loans and student loan repayment.

Episode Transcript

Adam Walker: Debt. We've all heard of it. Most of us have it. Debt is an almost unavoidable reality of life, but what happens when it starts consuming your life? The experts at Money Management International believe that financial challenges aren't meant to be faced alone. On this podcast, we hear stories of people's lives who have been changed by MMI's role as their toughest coach and loudest cheerleader. Today's episode will feature one of the experts at MMI as well as a student loan attorney and a personal finance writer to discuss the ins and outs of a type of debt that's all too common, student loans. Let's meet today's guest. Our guests on the show today bring a unique perspective to a discussion on student loans.

Amy as a financial educator at MMI, Adam as a student loan attorney, and Zina as a personal finance writer with a background in student loans. We're going to talk about all things student loans on the show today. all of you welcome to the show.

Amy Lins: Thank you.

Zina Kumok: Great to be here.

Adam Minsky: Thanks for having me.

Adam Walker: Well, this is a really important conversation.

I feel like a lot of things have changed In this over like recent years and also over several decades and the public might not be fully aware of them and also having personally gone through this process with one of my kids recently, I'm looking forward to learning quite a bit from all of you.

So thank you for joining me today. So let's start at the beginning with student loan payments that have resumed from each of your perspectives. What's been the impact to consumers of student loans with payments restarting?

Adam Minsky: I'm happy to start. So, there's been a number of major problems with the return to repayment in the last few months. Loan servicers are seemingly, overwhelmed, and there's been a lot of widespread reported problems, including erroneous billing statements, miscalculated payments, long hold times and dropped calls when people are trying to reach their servicers, long processing times for requests to be placed into a particular plan.

So actually, as recently as just last week, the Department of Education announced some financial penalties that they're imposing on some of its loan servicers. And they're also placing millions of borrowers into what's called administrative forbearances, which essentially postpone or pause payments while all this mess is sorted out. So it's been not going well as I think how I would summarize it.

Adam Walker: Wow. Anything you want to add?

Amy Lins: Yeah, I would agree with that. And I know from some of the statistics we've seen 40 percent of borrowers have not resumed payments, even though payments have resumed, but I think 40 percent have missed a payment. Now, some of that obviously could be attributed to what Adam mentioned, which is not getting the billing correct or not being able to talk to their servicer, but it really is a sign that there are a lot of people that are struggling. Anecdotally as well, we are seeing a real increase in people calling us for assistance, not ways specifically with student loans, but with all of their debts. We've seen just a huge year over year, like a 51 percent increase year over year and the people calling in for financial counseling and the age group specifically in that I'm a student loan borrower age group, is definitely on the rise.

Zina Kumok: I think just anecdotally from what I've seen with friends who have student loans, a lot of them I think got used to not paying them during the COVID forbearance and they maybe moved to a better apartment, maybe they got a car payment, something filled that student loan gap. And now that payments are resuming, potentially resuming, a lot of them are worried about, "okay, well, I now have this expense, inflation," there's a lot of things that are now higher in their budget that are taking over that student loan chunk, and a lot of them are worried that have to make significant changes in their lifestyle to account for payments when they actually resume.

Adam Walker: All right. So along those lines, then if someone is struggling with student loan payments. Or they will be struggling soon with student loan payments, what should they do?

Zina Kumok: I think maybe all of you would agree the Safe Plan can be a really great option. If you might qualify for a lower payment, this seems to be something that could really change a lot of people. It's a new income driven repayment plan that president Biden initiated, and that could be a really great option. If you have federal loans and qualify and have the right debt to income ratios that make it work.

Adam Minsky: Yeah. I would say, save is going to be best probably for the vast majority of borrowers. There are deferment and forbearance options available. And in fact, for folks who have been placed in an administrative forbearance, while these problems are sorted out, those forbearance periods may actually count toward loan forgiveness under public service loan forgiveness income driven repayment.

It's also a good idea to evaluate eligibility for loan forgiveness programs. There's some new initiatives that have come out including one that's ongoing called the IDR account adjustment which can provide borrowers with retroactive credit or loan forgiveness periods, which can accelerate your progress toward loan forgiveness, shave off a number of years in repayment in some cases, or if you're really lucky and you have older loans, you could qualify for forgiveness right away, if you do the right thing. So, there are other programs out there that can be useful for folks.

Amy Lins: Yeah, I think from my perspective, looking at your budget as a whole, right? So, if I'm going to, if I'm struggling to make my payment, what's the root cause of that, right? So looking at the expenses and the income side and looking at the budget as a whole, are there adjustments that can be made?

And then looking at that student loan payment and going out, say to StudentAid.gov and using the Loan Simulator to look at your repayment options. The SAVE plan is a great plan, and it's going to help a lot of people, but it also depends on your goals. It depends on your income. Because your expenses may be really high, but your income may also be high.

So, it has to be a holistic picture of, "why am I struggling?" And then I think the most important thing, although, as Adam already said, good luck with this right now is, making sure you're proactively talking to your servicer or at least attempting to reach out to your servicer. Because where I see a lot of people go off track is the ostrich head in the sand. "I'll just ignore this and it'll go away" approach and it doesn't. And so, educating yourself and then taking action, whatever that may be to change your outlook on your expenses, your budget, to make whatever happen, get a roommate or whatever.

I know, we're not here to talk about budgeting, but that's where it all starts. Because if you're struggling, why are you struggling and what's in your control and what's not? And the programs that the Department of Education has are focused on people who have things that are maybe out of their control, unemployment, a health situation.

Those are where you can do the defer or the forbearance, et cetera. So, I always go back to that, the budget first.

Adam Walker: All right. So, looking out over the next say 12 months, what do you expect the student loan landscape to look like over these next 12 months? Is there going to be anything new that's coming up? Anything we should be aware of?

Amy Lins: I think there are a lot of exciting things in 2024 and, Adam and Zina, please feel free to jump in here. But, the Save plan is going to have some substantial changes in 2024 that are going to be even more impactful to borrowers. I'll just mention, one is that the discretionary income is going to decrease from 10 percent to 5 percent for those with undergraduate loans. So, in effect, it could cut a payment almost in half compared to what they're paying today under the same plan, and that will be in July of 2024 this year.

Adam Minsky: Yeah, the Biden administration is also working on developing a new student loan forgiveness plan. as I'm sure many of you know, Biden's first plan that would have wiped out 10,000 or 20,000 in student loan debt was struck down by the Supreme Court last summer. That plan was created under a statute called the HEROES Act of 2003, which essentially gives the education department, authority to act during an emergency to try to rectify some financial harm. They're trying a different pathway with the new plan. It's going to be under the Higher Education Act, which has a different source of authority for canceling student debt. It's never been attempted on a mass scale, but they're in the process of trying to develop a new plan. They're targeting several groups or categories of borrowers based on the type of loans they have, or their history, or their financial circumstances.

It's still being developed and we don't have final details yet, but we're expecting final regulations on that to come out possibly as early as this spring. It may not be available until 2025, but there's some suggestion that they could implement what's called Early Implementation Authority to make the program available this year. I would imagine that plan is going to be challenged in court as well. But we'll have to see what that looks like. That could potentially be a new pathway to relief for some folks.

Zina Kumok: I think what I am just excited about is that people are talking about student loans more. I think there's a lot more education nowadays. I have friends who graduated and they had never heard of public service loan forgiveness. And now that things like that are more in the news, IDR plans, I think the waiver could be really great with that extension. I think a lot more people could see loan forgiveness or monthly payments counting toward the IDR loan forgiveness program.

I also was disappointed that the Supreme Court struck down Biden's plan, but I think people are now a little more engaged with what options they have, maybe what things they do qualify for. So I think people, there's more awareness nowadays, even if it's still not perfect. And even if a lot of people are still struggling.

Amy Lins: So, I think there's a couple of other things and they don't get a lot of press. The save plan is getting a ton of press and that's great, or it was for a while and there are going to be these additional enhancements. Like I mentioned, the decrease in the payment and also the time horizon for repayment.

If you have a smaller loan balance, If you're at 12,000 or less on your loan, that income driven repayment timeframe is going to shrink down to 10 years from the 20 years that you would have on the old repay plan. But there are a couple of things, I think, that aren't getting a lot of attention and one is, the steps that the Biden administration has taken to change the way interest capitalization works or the circumstances under which interest capitalization happens. And that's basically a big word. But what it means is there are certain times when interest is accruing and you're not paying it. So what happens? There are triggering events that required under the old rules last year and before for that interest to be put into the principal balance of the loan. So your principal and that's what gets charged interest.

So it's like interest on interest, right? Anytime that capitalization happened, you were automatically rolling that interest into the balance and that was increasing the interest that you'd be charged in the future. So there are only 2 circumstances now going forward where that will happen. And that's because it's required by law current law and, Adam, you're the lawyer, so I'm not an attorney, but as I understand it, only when they're coming out of deferment on subsidized loans, and then when they're exiting the IDR plan, because those are required. But otherwise, that capitalization has significantly changed, it's not going to happen in as many cases that's going to help a lot of people. That's when you hear this person that's been paying for 20 years and they have a 200,000. They started with 100. Now they've got 200. A lot of times, not always, but a lot of times it has to do with choices they've made and then ramifications they didn't understand related to how that interest was going to get added into their balance. And the other one is the secure 2.0 and that's the retirement funds.

This is a big one and it's not gotten a lot of press either where now employers can match contributions. You know how 401k works. So I put in, 1,000 into my 401k and my employer matches 3%. Now, if I take that thousand dollars and pay on student loans, they can still match what I've paid on student loans, not just what I've put into my 401k.

So that's a huge change and that's going to help younger, new to the workforce employees who are saying, "I can't do both of these things, but I want to save for retirement." Now they can talk to their employer about potentially matching their payments for their own student loan, their spouse's student loans or for older workers loans that their dependents have taken out. I think that's huge.

Zina Kumok: That is a really great point, Amy. If I made a list of the top five questions that people ask me in real life, it would be, "well, should I focus on saving for retirement or should I pay off my student loans early?" And in a perfect world, everyone would have enough money to do both. And I would always tell people like, "okay, you're young, there's compound interest. You should take advantage of retirement contributions." And this is a really good way to do both. And maybe you're still spreading yourself a little thin, but you're not completely neglecting your retirement account just to make payments on your student loans.

Adam Walker: Love that. All right. So, we dove in super deep, really fast, which I kind of love. So I wonder now if we could zoom out and take a step back just a minute and understand, what is the current student loan landscape look like? What are the current options for borrowers? Is there anything new? Is there anything that borrowers that are maybe new to student loans should be considering as they're making this decision?

Adam Minsky: Well, I think that we've already talked about the Save plan. That's one of the primary options that folks should consider. I've mentioned briefly the idea of account adjustment, which is this temporary initiative that can allow borrowers to receive past credit or IDR loan forgiveness, as well as Loan forgiveness under another program that we haven't touched on called Public Service Loan Gorgiveness. Which is for folks who are working full time for non profit and government entities. This one time adjustment essentially allows people to get past credit toward their loan forgiveness terms for periods that might otherwise have not have counted historically, such as periods of repayment under non qualifying plans and as well as certain deferment and forbearance periods. As well now for many people, this adjustment is going to happen automatically. You don't necessarily need to do that or sorry to do anything, such as folks who have you know a direct loan already But some people need to consolidate their loan in order to either qualify or to maximize benefits under this Initiative they have to consolidate through a program called the Federal Direct Consolidation Program.

This primarily covers people who have an older type of federal loan called an FFEL loan, which stands for the Family Federal Education Loan Program, which is an older program that was discontinued in 2010. But one of the lesser discussed features of the adjustment is that if you have multiple loans, including multiple direct loans, and you consolidate them, and those loans have different histories, they will credit the new consolidation loan with the maximum amount of IDR and DSLF credit that they can based on the individual loans that are being included in the consolidation. So for instance, if you have one loan that has 10 years of repayment and one loan that has two years of repayment, because it's maybe you took it out more recently when you returned to school, if you consolidate under the direct loan program to benefit from this adjustment, you might get 10 years of credit associated with that older loan for your full balance, which is a really major benefit. That program is a temporary initiative.

The department of education recently extended the deadlines for consolidating, it was going to be december 31st and they've now extended it to April 30th. So people have a little bit more time to explore this if they want to. And then they're expected to finalize implementation of the adjustment sometime later this summer, probably in July is what they're saying. So that's a major program that people I think should be aware of.

Amy Lins: Yeah, I think it's important to understand too, that going for what's going to be available going forward. So we haven't talked about the time based plans, right? The ones that are the fixed payment plans like the standard plan or the extended plan. Those plans still exist and they're still available in July. The Save plan will be available, but they're going to limit and the income based repayment plan will remain available. And then, the pay as you earn and the income contingent repayment plan are going to be sunset. There's going to be no new enrollments in page you learn, but there will be for parent borrowers who need an income plan. There will be an opportunity to consolidate and move into the income contingent repayment.

These older plans are not as "favorable," I guess I'm going to use that in quotes. The payment calculations are maybe not as favorable as the newer plans. The same plan in particular, but some of those are going to be sunset. So it's important if you're in it, you can stay in it, but new borrowers that are just coming into repayment are going to really be moved towards the new Save plan in the future.

Adam Walker: Okay, and even zooming out further than that. You're talking about different types of plans. I wonder if you could give an overview of what does that even look like? Because if you do a Google search for student loans, there's a lot of results, right? And some plans are government based, some plans are private based. I wonder if you just walk through all of that for me as well.

Zina Kumok: I think one of the biggest, I don't want to say misconceptions, things that people don't realize is that, if you have federal student loans, you're eligible for so many different types of income driven plans.

You're eligible for public service loan forgiveness if you meet the employment criteria. And unfortunately, what a lot of students and even parents don't realize is that if you have private loans, your options are so much more limited. Correct me if I'm wrong. I don't know of any private lender that offers any kind of income driven repayment plan.

And really, if you have private loans, one of the only options available is, if you're like a nurse or a doctor, and even lawyers have these programs where if you work in an underserved community, sometimes they have very specific, very niche, loan repayment programs. But those are, maybe you have to work in a rural area in a remote area, you'll have to move somewhere, and you give up 23 years of your life in exchange for having a lot of your loans forgiven.

And those programs exist for private borrowers, but they're not nearly as comprehensive as the federal programs. And so that's where I see a lot of problems and misconceptions as a student thinks, "well, I have all these private loans and so I can do PSLF." And they don't realize that, no, you actually don't qualify. And maybe based on what you do for a living, you might qualify for something, but it's not nearly as robust as the overall PSLF program.

Amy Lins: And federal loans have all these protections and I'm going to add to what you said, Zina, because they also have protections if you are permanently disabled or if you die, right? So your estate, your heirs, your family, doesn't have to make the repayment on the loans if you die or if you're permanently and totally disabled. And for a parent borrower, that's borrowing on these parent plus loans that could be really important for them. Whereas private loans don't have necessarily have, they could, need to read the contract before you sign it, those sorts of protections. And also, just the fact that many people get bombarded with advertisements from private student loan lenders, and in some cases, taking out a private loan to pay off federal loans, some people do that, right? You lose all of those federal benefits. You may gain a lower interest rate. And that may be fine. That may be what people want to do. Or in the past, before interest rates went up, they would do a home equity line of credit or things like that. I don't personally recommend those. I feel like that you're rolling the dice with that, but those are personal decisions that can be made. But people need to understand that once they do that, they've paid those federal loans off. They have a private loan. There's no going back.

Adam Walker: So like you mentioned several times, student loan forgiveness, it's sort of being in flux a little bit. It didn't work out. It got struck down by the Supreme Court. There's some new things that may work out. Can you talk a little bit more about what the trajectory is of that? How likely is it, in your opinion, that will happen? And I assume also that forgiveness will only be for federal loans, based on what we just talked about.

Adam Minsky: Yeah, so I mean there's been a number of initiatives already some of which we've talked about. So the Biden administration has approved so far, about 132 billion dollars in student loan forgiveness through what they call targeted initiatives. And basically what this is, they're taking existing programs and they've tweaked some of the rules or expanded access or made it easier for people to qualify, or automated relief, and through a combination of all those initiatives, they have been able to improve large groups of borrowers for forgiveness. So that includes the IDR account adjustment that we've already talked about it includes an earlier program called the limited DSLF waiver that allowed folks on track for public service loan Forgiveness to get some retroactive credit as well. They've rewritten the rules governing certain programs such as the total and permanent disability discharge program for folks who have medical conditions that prevent them from maintaining employment. And they've also been focused on providing relief to people who have been harmed or defrauded by their schools. Maybe their school closed or their school engaged in some sort of misrepresentation or fraud. So those folks have received large volumes of discharges as well, that's very significant historically, we've never seen this amount of loan forgiveness from any prior administration. That being said, it's still a relatively small fraction of the total outstanding debt that's out there and so there is a push to do something bigger and that was what the administration tried to do with the 10,000 and 20,000 alum forgiveness that the Supreme Court basically said, "nope, can't do that." So they are trying again with this new program. We'll have to see what that looks like. But in the meantime these targeted initiatives so far are ongoing.

Zina Kumok: I think that's something, sometimes people miss the forest for the trees. There's been so much discourse on, "Biden hasn't done what he said he was going to do." He promised he would forgive student loans if he won. All these young people came out in droves to vote for him. And I think a lot of them are feeling very abandoned. But as Adam said, there have been so many loan forgiveness programs, these waivers are huge. There were so many problems with PSLF and IDR that these waivers are really making a big impact for borrowers who maybe didn't understand what they had to do to get loan forgiveness or her who were misled by their loan servicer who give up bad advice.

So I always tell people like "yes, there has been no broad loan cancellation, but there have been so many people who have been positively affected by these changes." And the IDR waiver, as Adam said, that's going to affect until April. It's not too late to go out and get that. I'm not sure when this episode is coming out, but if you even, if there's a remote possibility that you think you're eligible, go get on that. Please go get your months counted, because you could be saving a lot of money.

Amy Lins: Agree, and I do think it's important to give credit where credit is due. And as Adam and Zina both said, there were people who were entitled to, and I'm going to use the word entitled in that way of they earned, they did what they were supposed to do, they earned it, or they qualified for it.

So, either through public service loan forgiveness by doing their 120 payments and working for their employer who then, had some kind of technicality or their payments were not counted correctly, or someone who's a veteran who's permanently and fully disabled and then had to jump through 10 hoops to try to get.

Their discharge, which they are, clearly entitled to all of those things have been huge strides forward that the sort of red tape and paperwork and just inability to get what you truly should qualify for those strides shouldn't be overlooked. And I applied both Adam and Zina in focusing on that, because, yes, that 20,000 10,000 thing, that was a moon shot, okay, it didn't quite make it right.

We're going to try it. We're going to see. But up front, they were very up front. This might be struck down by the courts and then it was. But these other things are on solid ground and are happening. They just don't get the headlines.

Adam Walker: What are some of the most misunderstood things that people don't get about student loans and student loan repayment?

Adam Minsky: Well, I think a lot of people historically have not understood how interest works and I think that's been, we've threaded different pieces of that throughout our discussion today, but you know I think people have not fully understood that for some types of loans interest starts accruing as soon as the loan is dispersed. Not every loan has a subsidy that suspends interest while you're say, in school. So you might end up owing more than what you started with by the time your loan enters repayment.

Under income driven plans, historically, there's been no requirement that your payment be high enough to cover all the interest. You could be doing everything right, making your payments and making progress toward loan forgiveness, but watch your balance balloon over time. Thankfully, that changes under the SAVE plan, which has a subsidy that eliminates excess interest accrual, but historically that hasn't been the case.

And some people think that, if I want to make a payment go directly to my principal, I have a right to do that. But you don't if you have a large amount of accrued interest that is already out there. You have to pay off all that interest before you can even touch principal. And again, I think a lot of people just haven't fully internalized how interest can really create a large cost when it comes to repayment even under a non income driven plan. If you're on a regular, full payoff plan you might want to get on an extended or graduated plan because it provides you with lower payments. But because you're going to be stretching out that term you're going to be paying a lot more in interest over time depending on your interest rate. You could easily pay two or three times the amount that you originally borrowed so I think that understandably, you know, when you take out a loan at 18, you're thinking about going to college not about math, but interest, unfortunately, can be not just a major problem financially, but I think a major problem for people emotionally and psychologically when you have been putting so much of yourself into paying off these loans and you feel like you haven't chipped away at it at all. It can be really demoralizing for people.

Zina Kumok: Adam, I think you've touched on a really great point. We always focus on the programs and serve the options you have available and the repayment plans. The mental health aspect of taking out student loans can be so damaging. We have a colleague, Melanie Walker, who really focuses on that in her writing and she says a lot of people find her blog because they google student loans and anxiety, depression and even suicide.

And that is, I think something that doesn't get talked about is when you are 22, you graduate with 80,000 in student loans and you're making 40,000 a year, or maybe you have six figures in loans. The mental toll that takes, that makes it harder to maybe better at your job to, just be a happy, fulfilled person.

And unfortunately, a lot of people don't realize like what options they have available. And I always tell people, if you're thinking of applying for deferment or forbearance, look at one of these income driven repayment plans, depending on how much you owe compared to how much you're making, you could have a very low, affordable monthly payment that still gives you credit or loan forgiveness.

If you just defer because of Economic hardship or unemployment, you're not necessarily getting credit. I know some things have changed around that, but I always tell people, "I see what you're monthly payment would be under one of these IDR plans. And if you're still struggling with the mental health aspect of having student loans, there are some therapists that offer, a sliding scale based on income." There are some affordable options, maybe through your insurance. And that just doesn't necessarily take away the balance of having student loans, but just talking about that can make you feel a little less alone. There are student loan counselors and experts that can help and maybe offer advice or resources that you haven't thought of.

So I think what Amy said earlier, burying your head in the sand is just, it's an understandable reaction, but there's maybe something else you could do to really get yourself out of this hole.

Amy Lins: I think one of the most misunderstood things about student loan and the repayment options is that the income payments aren't always the best option. It depends on if you're a high earner, the income plan, especially the save plan, there's no limit on what your payment might be. So you may be paying more than on the standard plan. And you also can pay, you can be paying on these plans thinking, "okay, I'm going to get all this forgiveness at the end of my time or what have you."

But your life circumstances can change because you could get married, you could get divorced, you could have a child, you could decide to stay home and not complete your public, 10 years is a long time, 120 payments. It's a long time to be banking on your balance being forgiven.

And that drove home for me when I was actually talking to our neighbor's granddaughter, who was a new graduate. And they asked me, "Hey, can you talk to her about student loans?" They know what I do, for a living. And I said, "sure." And as we were talking, she was getting married in the next summer. And this was last year. And we talked about it and it's "okay, I understand how much you're making now, what is your fiance?" "Well, he didn't have any student loans and he was a high earner and his own business, and he had a high income." I'm like, "okay, that's going to change your equation on these income plans. You need to really look at that. You're also wanting to go for public service loan forgiveness in your field. What if you guys decide to start a family? What if you decide to stay home?" So it's not just in the moment, but it's like, what's the future going to hold too? And you have to hold both of those things together in your mind as you're looking at these plans.

They are great and they are designed for people who can't make that standard payment or who are in, they've got a relatively high student loan debt compared to their income. And they're great for what they're meant for, but they're not meant for everyone. And if you try to shoehorn yourself into that, you might end up paying more in the long run.

And you just have to be aware of that, of how the interest works, like Adam said. Because if your payment doesn't cover your interest, yes, your interest is waived, whatever you're paying is paying towards interest and the rest gets waived, but you're not decreasing your principal balance.

You could get five, ten years down the road and you still owe the whole principal balance. And then what happens if you have to change plans or your life changes? There's just so many "what ifs" that I think what makes part of this so hard to make solid recommendations to people. Because, you're just going on what they're telling you today and not what their future might look like. So everybody really has to understand the ramifications of the plans they choose and the assumptions that are made about the future when they choose a plan. Stay engaged with their finances as their circumstances change.

Adam Walker: That is fantastic advice. Wow. This has been truly enlightening. I really appreciate the expertise that each of you brought to the table. Thank you so much for joining us on the show today.

Amy Lins: Do we have time for one more little course?

Adam Walker: Of course we do. Yeah, absolutely. What else you got? Let's do it. What do you have this morning?

Amy Lins: Okay. Look, there are 1.3 billion with a B, views on videos on Tiktok that have the hashtag student loans. Now I would like to think that all the content creators out there on Tiktok know what they're talking about.

But I guarantee like a billion of these 1.3 billion hits are nonsense. Like you need to be careful where you're getting your advice. And people need to look for trusted advisors. They need to do their own research. That's too good to be true. It's too good to be true. And there are a lot of debt relief scams out there.

And so don't pay someone 500 dollars for their course off of TikTok on student loans. There are other sources, trusted sources available. And a lot of stuff is most of it's free on studentaid.gov. And so, I just want to put that out there. The sort of buyer beware that I thought that was an incredible statistic, like a whole industry on TikTok around student loans.

Adam Walker: Man, that's good to know.

Zina Kumok: Not to prolong this any further. Can I also add something?

Adam Walker: Of course. Yeah, please.

Zina Kumok: Okay. One of the biggest misconceptions I've seen is that people don't realize you have to be a W2 full time employee to qualify for public service loan forgiveness. I have seen so many contractors, people who work on a 1099 basis who are maybe working in like a government organization or a nonprofit, or they just assume that they're eligible for PSLF and they sign up for the IDR and maybe they don't submit the employer certification form annually that. We always recommend that you do and then they get to that 10 years and think, "wait, none of this has been forgiven." It's like a very complicated rule. And I think a lot of people, I'm just worried a lot of people are going to get to that 10 year mark and then be really confused that their loans aren't forgiven.

Adam Walker: Yeah, that's good to know. Adam, any last minute things on your side? We covered it. We covered it. Okay. Well, that's great. Well again, genuinely, this has been incredibly enlightening. I cannot thank you enough for bringing your expertise to this conversation and just for the good work that you're doing in general. It's so, so important.

Adam Minsky: Thank you.

Amy Lins: Thank you.

Zina Kumok: Glad to be here.

Adam Walker: Thanks for listening to this episode of Long Story $hort brought to you by Money Management International. To learn more about how MMI helps people from all walks of life get unstuck and out of the vicious cycle of debt through personalized solutions that inspire hope, visit moneymanagement.org. This episode was produced by Edgewise Media. Script writing and production by Amy Scott, editing by Neil Geid, and show hosting by me, Adam Walker.

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