The Student Loan Podcast Intro (00:02): Welcome to the Student Loan Podcast. Here you'll find practical advice on tackling student loan debt, paying down your higher education expenses, and inspiring stories about paying off student loans. We're your hosts, Daphne, Vanessa and Shamil Rodriguez.

Daphné Vanessa (00:21): Please rate, review, and subscribe to the Student Loan Podcast by visiting the Student Loan Podcast on Apple Podcast or wherever you find your podcasts.

Shamil Rodriguez (00:32): This is not professional advice, and we speak from our own personal views and opinions.

Daphné Vanessa (00:37): The Student Loan Podcast is brought to you by StartNoo, where you can serve your community and get rewarded with tuition and student loan payments. To check out if StartNoo is on your campus, visit startnoo.com.

Shamil Rodriguez (00:52): Welcome to another episode of The Student Loan Podcast. Today we have an update for you. It has been quite some time, or I guess I'd rather say a lot has happened in the student loan space since the last time we did a student loan news update on the Student Loan Podcast. So we thought with the most recent news, an extension by the, by the administration and the Department of Education, that it would make more sense to talk about that now with a string of lawsuits that also are looking to stop President Biden's, uh, executive order to cancel up to $20,000 in student loan debt for student loan borrowers that qualify for the program. So we are going to take a deep dive into that program today or into those topics today, just so that you're up to date with the latest and greatest on student loan news. Let's get started.

Daphné Vanessa (01:43): Let's do

Shamil Rodriguez (01:44): It. How are you doing today, Daphne? Sorry. Didn't even bring you in on that one, so I apologize for that. .

Daphné Vanessa (01:50): It's totally fine. I feel like people just wanna know what they wanna know, and right now it's, how does all this impact me? I mean, I feel like that that's what I would ask. That's what I'm asking is, yeah,

Shamil Rodriguez (02:02): How does I feel like it's

Daphné Vanessa (02:03): All this impact me?

Shamil Rodriguez (02:04): Yeah, very fair, very fair question. So what we're gonna do, uh, before we get into that, we're actually going to play video from, uh, president Biden when he made the announcement of extending the student loan pause, and then we'll go from there.

Speaker 5 (02:18): Folks, I wanna give you an update on my student debt relief plan. As Americans continue to recover from the pandemic, my administration's been working to provide student debt relief to millions of working and middle class families across the country. But Republican special interest and elected officials sued to deny this relief, even for their own constituents. But I'm completely confident my plan is legal, but right now, it's on hold because of these lawsuits. We're not going to back down though in our fight to give families breathing room. That's why the Department of Justice is asking the Supreme Court of the United States to rule on the case. But it isn't fair to ask tens of millions of borrows eligible for relief to resume their student debt payments while the courts consider the lawsuit. For that reason, the sector of education is extending the pause on student loan payments while we seek relief from the courts, but no later than June 30th, 2023, which would give the Supreme Court an opportunity to hear the case in its current term, payments will resume 60 days after the pause ends. I'm never gonna apologize for helping working class and middle class families recover from the economic crisis created by the pandemic, and I'll continue working to make government work to deliver for all Americans. For all Americans. This is important.

Shamil Rodriguez (03:39): So I found it, uh, pretty interesting. Uh, what do you think, Daphne?

Daphné Vanessa (03:44): Interesting. I mean, first of all, the student loan pause is continuous and pervasive

Shamil Rodriguez (03:51): ,

Daphné Vanessa (03:53): Like without being too funny, um, the student loan pause continuing to be extended makes me honestly feel that by the time, first of all, it's been extended for, what, two years now? Almost two years?

Shamil Rodriguez (04:08): Yeah. Yeah. I guess it, it, it would've happened during the pandemic. So it's 2020, right? And now we're going into 2023.

Daphné Vanessa (04:16): Yeah. So it's half of, of someone's college experience has been on student loan pause, and I think like, I'm sorry for laughing, but by the time it comes back, people are gonna be like, just whatever. Like, I'm not,

Shamil Rodriguez (04:33): I'm sorry, I didn't even think about that. Like, people would just be like, you know what? I'm just not even doing this. This is not even a thing. Right. I did not, that actually did not cross my mind.

Daphné Vanessa (04:42): That's exactly what crossed my mind, and it reminded me of Umay, who we had on the podcast, like, I don't know, 30 episodes ago or something when she said, you know, they just don't pay their student loans. I don't know. There are people in this world that are doing that already. So I think extending the pause, I feel bad for the lenders, but also what a great time to be a borrower, you know?

Shamil Rodriguez (05:07): Yeah. No, I mean, usually people complain about, um, you know, being a small, the small guy, uh, you know, versus the big banks or things like that. But you're right. I guess it is a good time to be a borrower at this point. Um, I also found that interesting that, that, uh, president Biden used the Supreme Court, uh, or the lawsuits, uh, stopping the, the planned cancellation of the loan debt for of $20,000, uh, as, as a reason or justification for doing this, uh, and that the payments were resumed 60 days after June 30th. So,

Daphné Vanessa (05:46): Like I said, people are gonna be like, yeah, and

Shamil Rodriguez (05:52): Yeah, well, you know what, I guess outside of like the skepticism and like, how funny it is to think about it from that perspective of how long it's been, right? It'll be three years at that point.

Daphné Vanessa (06:03): Nice.

Shamil Rodriguez (06:04): I do hope that, that the folks that were able to take advantage of it have, and if you haven't, like, you definitely can, right? Yeah. Like, I know that holidays are here, so I understand that that's gonna be different times for different folks. I get that. But like, if there's any new New Year's resolution you wanna put out there, I guess, for some inspiration for people, since we're about to hit December. Yep. Uh, I definitely would recommend adding to your list of New Year's resolutions, like paying down your interests, non-interest bearing student loan right now. Like it is not accruing interest. You are getting the best deal that you will ever get for a student loan. What do you think?

Daphné Vanessa (06:42): Oh, completely agree. It's, it's like make June 30th or 60 days from that your deadline by which you wanna be debt free. And it's totally, it's, even if you haven't done anything yet, it's like you basically have another six to eight months where you can make a huge dent on your student loans and not having student loans for the rest of your life. I mean, what a

Shamil Rodriguez (07:11): Really, that sounds good to me. I don't know about you, but that sounds good to me. Right? What

Daphné Vanessa (07:15): A gift that would be. What a gift that would be. I think I'm happy for everybody who's benefiting from this. I don't feel bad. I don't feel like, oh, I paid my, I don't feel that at all. I'm super happy for everybody who can benefit. I don't, I don't wanna say I feel bad for lenders because anybody who makes an investment knows that it can go well or it can not go well. Right? And that's a risk that you take being an investor. I recognize that probably the terms that they drew up whenever, by the way, the terms that have changed 50 million times from borrows perspective, whole other conversation. But you, I recognize that lenders may feel that this is negatively impacting them. And this major lender at play here is obviously the government. Um, but at the same time, you know, this is a wonderful opportunity to reset a whole new generation and, and make a productive workforce. So I see both sides, to be honest.

Shamil Rodriguez (08:15): No, no. I, I do too. And I, and I think it's been, it'll be good to bring up this point here too, that the folks that are against, uh, the extension of the pause are saying, Hey, there are loans out there that have interest payments that need to be paid, and they're being paid back to the government, right? They're direct federal loans that, that were given up by the federal government. So why are we waiving this, these interest payments, you know, these are, these are, these are funds that are, that we're losing out on at this point. So who's losing? Well, not, I'm, I'm trying to make the argument or anything make the argument. I'm trying to share the other side's perspective, right? That, that there's billions of dollars that are not being collected right now, uh, because of this extension of the pause. Now, it initially happened over due to the pandemic, but even so, I think what you said is a bigger point, which is who's benefiting, right? And that we call it the government, but let's also think that the people that are the borrowers do make up the government. And this country,

Daphné Vanessa (09:18): The government is making money from taxes. They're making money from all the, if you don't know how to spend your money, that's a u problem. Don't, don't come to that borrowers, people who barely knew what they were signing when they're 18 years old, 17, you know, young children who made these commitments thinking that education would make their life better if they didn't come from a life or a household that afforded them certain, certain necessities. They were, may have been using education to build a better life, and they're being taxed on that. Like, I don't know. I just feel like we need to get to a point in society where is education a public good or is it not just decide? And what it looks like in the United States is that people haven't decided, one minute education is a public good. The next minute it's not.

Shamil Rodriguez (10:14): Yeah. I don't even know if it's, if people have decided on flipping back and forth, I think the answer is just clear that it's not right. Like it is a business here. Uh, and that's the way we treat it. Because if it were the case, we would've already done it. Right? We're not, we're not this outlier of a country that's looking to decide to be the first country to make education free, right? In the end. Ultimately, I think it's, it's a good move to extend it, especially if you had the plan to cancel up to $20,000 in student loan debt for those who qualified for it. I just, like I said, I just hope that people after the holiday and the new year begins, seriously, just consider adding it to your new resolution and just saying, Hey, I can take advantage of this once in a lifetime opportunity where they are freezing the interest that is accruing on my student loan, and now I can just tackle the principle with whatever I put towards this. I think it's just a great opportunity. That's, that's really, really it. So, I mean, we've been here before. We've covered this in our episodes before, uh, pauses have been extended since 2020 .

Shamil Rodriguez (11:20): So we will continue to keep you covered. Uh, and, um, thought this was a great way to start off the loan podcast with some of the student loan updates, uh, that have been happening since the last episode that we did on this specific topic. So, with that being said, I've hinted and have said several times already, and I know many of you listening have already applied for up to the $20,000 in student loan forgiveness that President Biden, uh, had put together under his executive order. But unfortunately that is currently stuck in the legal system. So, uh, instead of us, uh, just kind of randomly jumping around with the different lawsuits that are out there, Daphne actually has a great resource that she came across that lists all of the lawsuits that are currently impacting student loan forgiveness in one way or another.

Daphné Vanessa (12:09): I think you can group these cases in, in themes. So some of the cases are plaintiffs that are alleging that they've been harmed by the student loan forgiveness plan, because tax wise is one re organization argued, uh, for fiscally responsible policies. So, you know, various groups or individuals are claiming that the plan harms them financially. Do you wanna add anything Shail?

Shamil Rodriguez (12:43): No, I find that interesting, uh, to say that they're being harmed, cuz I know there were some cases by states, um, and I don't know if this is the one that you were thinking or this grouping that you were talking about, uh, where the states were claiming that they were being harmed, uh, because of, of this executive order. Uh, but that initial case was actually dismissed, and then when they went to appeal it, uh, the eighth Circuit Court of appeals actually, uh, upheld their request for an injunction. So it wasn't, it wasn't even the original case was dismissed. So I just find that interesting when these organizations or states in that example that I just brought up, uh, were saying that, you know, they're being harmed by, by the executive ward of the president push through.

Daphné Vanessa (13:28): I personally see themes generally in the US during this divisive time, which is when one administration has a policy that's polarizing because of federalism in the United States. The other side, whatever the other political side is, will use state law to break apart whatever initiative the opposing party is trying to put together. This has happened pretty consistently for the past six or so years. It doesn't, not only in our space, not only in the student loan space, but it seems like more of that is happening, more politics and less, you know, actual thought about how we can make education accessible to all people.

Shamil Rodriguez (14:22): I think we should also just say that, uh, for those six dates that are blocking the student loan debt relief, you know what, just, uh, I, you guys are clearly not fans of the Student Loan podcast,

Daphné Vanessa (14:39): . Maybe, maybe they listen, but likely not

Shamil Rodriguez (14:43): Likely.

Daphné Vanessa (14:44): Likely not at all on any other state because you, I I'm not hating on any state. A whole state of people can't have one idea.

Shamil Rodriguez (14:55): Absolutely not. That's what I'm not calling about. I just find it interesting and, and thought it would be funny. All right. So, uh, what is the next group of lawsuits that are impacting student loans that you have on your list?

Daphné Vanessa (15:06): I just found it interesting that one organization used the fact that this policy would contradict another policy. So there was a student loan cancellation program

Daphné Vanessa (15:23): For, um, people paying for a decade if their government employees or non-profit workers. That still exists actually. And the Cato Institute argued that that relief plan could undermine the existing public student loan forgiveness program. I thought that case or that argument was interesting. The case is still pending. Um, but I, I felt like that was an interesting play on, you know, broad student loan cancellation, because that's really been the term being used here is broad student loan cancellation, which by the way, you know, up to 20 k is not broad student loan, you know, but different topic for the purposes of this. I found that that was a really interesting play on, um, peeking away at the broad student loan forgiveness program.

Shamil Rodriguez (16:20): Yeah. Uh, I I, it has been interesting cuz a lot of people, and we've covered in other episodes, you know, settlements that have happened, uh, and debt relief for individuals that have attended schools that have taken advantage of them, uh, or haven't provided, you know, this, you know, the education that they were promised. Uh, so I do think it's interesting that when there's finally that relief for individuals, uh, that really doesn't distinguish between someone who went to a private, uh, or a private university versus, uh, or some of the ones that they settled before versus just your typical school that you go to. Uh, it just found it interesting that there's just so much, uh, legal red tape or legal arguments being made to try to prevent this from happening. I just really do, and maybe it would be good episode, uh, to bring someone on that's on these teams or somebody that's really advocating to prevent this from happening and, you know, you know, we'll consider that or maybe worth considering. But, um, you know, like you just said before, it really is politicizing the issue when I really do think it is just a debt release debt relief issue, especially for a generation that has gotten caught in a, a time when education costs surpassed what salaries and incomes were making. It's just we know that they had outpaced, uh, salary incomes in American households and there's a big swath of people in America that are carrying that burden versus, uh, those that came before them.

Daphné Vanessa (17:58): Right, right. Which begs the question, is education still worth it? And I think that's why you have so many people in various generations reconsidering education and what it can do for their lives. Obviously it depends on what your background is, what next step, what the next step is for you. I find it very interesting, but also fitting that in a time when the cost of education is, is excessive, people are finding other ways. But interestingly, if we're ready to switch, universities are finding other ways as well. .

Shamil Rodriguez (18:39): Yeah. I think, I think it would be good timing too because, uh, to, before we switch to universities, uh, keeping up with the times, uh, just to talk about whether education is worth it or not, uh, as we see in the news, again, this is impacting everything that we're talking about in terms of this update. That more and more companies are dropping college degree requirements for new hires. Right. And they're focusing on skills and experience and personality traits that these individuals may have. Mm-hmm. . Uh, so that really opens up the amount of candidates. But to speak to your point, Daphne, it really hits to the question of is education worth it or going to college worth it In this time when we're thinking about how it's being financed, the cost of education, what the income you'll have when you graduate with your degree. We're not, we're not here to advocate one or the other.

Shamil Rodriguez (19:29): We're just saying that it's interesting to see that question is having real life results because not only are more and more modern technology skills, schools popping up programming schools, you'll see popularity in different types of skills, uh, in modern tech arising without the requirements of having a four year degree. Mm-hmm. and now the employers that were your reason that people were going to school right. To get those degrees so that they can apply for these different jobs are saying, Hey, you know what? We're going to drop our college degree requirements for new hires and focus on those skills, experience and personality traits that they have. So we're, we're seeing, it's not theoretical anymore. We're seeing real life applications, uh, play out as we, as we record this episode.

Daphné Vanessa (20:17): Yep. To move into an example, Colby Sawyer College is a school that recently reduced its tuition by 60%. That's, that's not half 60% meaning the tuition was 46,364 and it's gone down to 17,500. Huge. Wow. Huge decrease. And this is in, in New Hampshire, in case anybody's thinking about applying the schools in New Hampshire,

Shamil Rodriguez (20:51): . Yeah, that's a, that's a huge decrease. And I, and it would be interesting to have someone from that school on the pod, uh, to talk about, uh, how they made that decision, uh, because to to to have that dramatic of a decrease really makes me me wonder what the board of trustees, you know, meeting was like, uh, to make that decision and what was cut. Right. It, it would be interesting to take a deeper dive or actually do a case study episode where we're talking about some of those details. Thank you for sharing that. That's a really good example.

Daphné Vanessa (21:22): Yeah. And it's not the only one. Schools are going out of their way to create financial aid packages that are appealing to students. You know, the schools are realizing that cost is that big reason why people are dropping out or not coming back.

Shamil Rodriguez (21:38): Yeah, no, we're, I've, I've spoken to some folks that work in schools, um, and the administrative side of things and have said that they've seen a drop in nearly a third, the enrollment numbers that they had from year over year. So I know, you know, we talk about these ideas in the, the past couple of years, but you're actually beginning to see the real world, uh, repercussions of these, of these expensive schools. Uh, so it's worth, worth keeping an eye on. And, uh, I think we'll, we'll definitely bring some more of that, that information to the podcast, uh, so that you can make better decisions, uh, and know, like Daphne brought up a school that may not have been on your radar that's now 60% off, let's put it that way. They know we're in the holiday season, right? Uh, black Friday just passed black. Yeah. You just, you just gotta back Black Friday sale for this school 60% off. So, um, all drug society, it, it is a really good example that you brought up. Uh, and I think a real world application of how schools are going to have to adjust to keep up with how, uh, the economy is adjusting and how their end users or their customers, right in the end, um, are determining whether or not they wanna spend their dollars, uh, for those educations.

Daphné Vanessa (22:56): Yep. And another way that colleges are doing this are the no loan financial aid packages. And I, people are probably already familiar with zero interest loans, right. The zero interest loans that certain schools offer their students so that they pay it back. But as long as you pay it back within the time period and the terms that the school provides, you don't pay any interests. Those are like wonderful, wonderful terms. Well, Grinnell College announced two years ago that it would end loans in financial aid at all. Mm-hmm. that the president at the time, Ann Harris, um, who came in 2020 realized how badly debt was impacting, you know, student outcomes. And so really taking an idea that one of the universities with the largest endowment fund Princeton University, they removed loans, you know, way back when and as a part of a commitment from, you know, obviously one of their wealthy their wealthy supporters for sure.

Shamil Rodriguez (24:16): But the

Daphné Vanessa (24:17): Smaller school , this smaller school also, you know, took, took a page to say, well, how can we also empower our students? And when I say smaller, it's still a private liberal arts school, but, um, they, they thought, how can we empower our students by removing financial aid and allowing for students to only rely on grant scholarships and work study And

Shamil Rodriguez (24:46): Yeah. And you know, there's, and you know what we'll do, Daphne, we'll link, uh, in our show notes a list of the colleges, universities, uh, that calculate financial aid without student loans. Right. And that list is, it's, it's not terribly long, right. But it is noticeable cuz it's not just, uh, you know, your Princeton's, uh, or your Yales, um, or your brown universities, your Dartmouths Right. But you actually have other schools on here, um, that I think folks will find interesting. Uh, like Davidson, duke, Dian mention Grinnell, uh, MIT, Northwestern, the list is, is a pretty good list to show that, um, to, to back up what you're talking about. And I think it's important for folks to know where they can find these schools.

Daphné Vanessa (25:32): Yeah, yeah. No, absolutely. So we'll, we'll link those and, um, of course, you know, if you already have student loan debt and you're already way down the journey, , this is only, this is only, why didn't this exist when I was going to school? Maybe. Yep. But if you are currently in school, you can always transfer not to, you know, diminish where you go to school, but always continually assess, just like when you're working and you're continuously assessing your opportunities, you just do the same thing when you're a student. It's obviously wonderful to have a singular experience at one school, but if you want to think about your financial future, it may also be a good idea to consider schools that are more supportive of your financial future. So that's all I'll say on that front. ,

Shamil Rodriguez (26:28): No, I think this is, this is wonderful. I'm actually really happy we recorded this episode. Is there another case that you had in mind or another topic that you wanted to discuss? Uh, otherwise Daphne, I'm, I'm really happy we're with where we went with today's episode.

Daphné Vanessa (26:41): Yeah. I, I wanna bring up the idea that some degrees and some professions don't deserve student loan forgiveness. I feel like this has been spoken about and I don't know that we've really had a conversation about it.

Shamil Rodriguez (27:04): Uh, you're talking about the folks that are arguing against, uh, the idea that certain professions just don't deserve student loan forgiveness at all.

Daphné Vanessa (27:12): Mm-hmm. .

Shamil Rodriguez (27:13): Oh, yeah. No, I mean, I, that argument is out there, uh, where they're saying that these programs are only going to help, uh, doctors and lawyers and, and they should not receive any assistance at all because every doctor and every lawyer in America is wealthy. Um, which we just know is not true. And, and in my opinion, I actually didn't even know if we should bring that up for, for it being such an obvious talking point that is inaccurate mm-hmm. . But besides saying that that way, what are your thoughts Daphne ?

Daphné Vanessa (27:49): Well, I think we just look at the data, right? And the data shows that in 2016, the average entry level salary of an attorney, as an example, was $64,000. So $64,000 per year can be made by non attorneys as well. It's not so large an amount of money that you would be able to easily pay off $250,000 of student loans that it took you to get that law degree. So I wonder what the world would look like if we focused on percentages of income instead of just assuming that a whole profession of people make too much money. It's not always the case. Yes, there are a lot of lawyers that make a lot of money, but it's not always the case. So, yeah.

Shamil Rodriguez (28:46): And I, and I think it's a good point, and you just reminded me that we did discuss this briefly on one where we was our crazy ideas, um, about helping for student loan forgiveness.

Daphné Vanessa (28:57): They're not crazy ideas, they're fantastic ideas.

Shamil Rodriguez (29:01): No, I think so, and that's not what the title of the episode was, but it was more so out outside the box thinking. And one of our ideas was that percentage based model, whereas a percentage of your income so that you're actually impacting folks that are disproportionately affected by the amount of student loan debt that they have to pursue their career or the degree that they pursued, right? Because in the end, we still need doctors and we still need lawyers. Now, I feel like I set myself up for a lot of jokes about us having too many doctors and too many lawyers in America. Uh, but people, people

Daphné Vanessa (29:35): Say that there are too many doctors now.

Shamil Rodriguez (29:38): Oh, well actually maybe not after the pandemic. You're right actually, that, that that market is hot for new hires. Uh, actually was speaking to some folks about that recently that work in the hospital system. Uh, so no, actually, no. Uh, but I'm pretty sure people associate, there are plenty of lawyers in America, or at least there are plenty of jokes about that. Um, but, but I think you bring up a good point, and it might be worth having a, a deeper dive into that topic, uh, because there, it's, it's just been interesting that that's really been one of those political talking points where you'll hear this like the automatic, uh, rebuttal to any of the current administration's, uh, concepts for student loan forgiveness. Uh, they're trying to lump in that this is only going to help the wealthy, and that's just inaccurate. Like, you just, you just can't lump everyone in together.

Shamil Rodriguez (30:28): But, uh, we know that, you know, it's all part of, of a political theater. Uh, but my hope is that through our podcast, people are gonna at least, uh, just think about these topics and not just the talking point when they're hearing, uh, you know, a news update or a response or reading a headline, uh, in response to some student loan debt relief, uh, news that they might come across. Agreed. On that note, we'll wrap up, uh, for this episode today. Is there anything else you wanted to say before we go, Daphne? That's all. Okay. So for more information on today's episode, visit the still alone podcast.com/episode 79. That's thes alone podcast.com/episode 79. See you next time.