Obama’s Plan for StudentsPosted: October 31, 2011
By Michelle Burke
Are you stressing out about the student loan bills you have piling up as graduation gets closer? Fortunately, you may no longer have to worry. This past week, President Obama announced the new and accelerated “pay as you earn” program for college students after they graduate to pay off their loans. The plan, which is coming into effect two years early if passed by congress, will allow students to pay off their school loans according to how much they make. Only ten percent of each paycheck recent graduates receive will go towards their loans. After twenty years, all remaining debt will be forgiven. This is five years early than the current law.
If students have more than one federal loan, the new program allows all debt to be consolidated. This can drastically reduce interest rates by up to fifty percent! Such savings can significantly help newly graduated students trying to begin their careers. With college tuition prices at their highest and still on the rise, and the economy still in an unstable condition, the “pay as you earn” program is a helpful plan to college students.
President Obama made it clear that this new plan is in addition to his job plans, not in place of. The White House said “we cant wait” to put the student loan efforts into effect. The program will not cost taxpayers anything, and is made solely to help American graduates achieve their dreams.