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After years of payment pauses and shifting policies, student loan borrowers are facing a new reality. Not only are monthly student loan payments resuming, but major changes to federal repayment and forgiveness programs are also on the horizon. A sweeping new bill, which was signed into law on July 4, 2025, is set to phase out popular income-driven repayment (IDR) plans, tighten borrowing limits and make student loan forgiveness harder to access.
Under this new law, student loan borrowers could, in the coming years, find themselves with fewer repayment options. They may also be subject to stricter caps on how much they can borrow with federal loans, and those who are unable to keep up with standard repayment plans may also face longer repayment timelines. These shifts could make staying on top of student loan payments even more challenging for those repaying undergraduate loans, finishing graduate school or carrying Parent PLUS debt.
But here’s the good news: You still have time to take action. By understanding your options now and adjusting your repayment strategy, you can make your student loan payments more affordable, giving yourself some crucial breathing room before the new rules take effect.
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5 ways to make your student loan payments more affordable now
Here’s how to make your student loan payments more affordable and protect your financial health as the new system takes shape:
Switch to an income-driven repayment plan
If you’re struggling with federal loan payments, enrolling in an income-driven repayment (IDR) plan can instantly lower your monthly bill. These plans cap your payments at 5% to 20% of your discretionary income and can reduce your payment to as little as $0 if your income is very low. And, while they extend your repayment timeline, they also offer the possibility of forgiveness after 20 or 25 years of qualifying payments.
If you’re already on an income-driven repayment plan, now is also the time to make sure you’re certified and meeting all of the requirements. Starting in 2026, these plans will be replaced by a single income-based option with higher minimum payments, so it’s important to take advantage of the current repayment options before they’re no longer available.
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Request a temporary payment pause if you’re struggling
If you’re facing short-term financial hardship, requesting deferment or forbearance on your federal loans can give you some breathing room. These options allow you to temporarily stop or reduce payments, helping you avoid delinquency and default.
Keep in mind, though, that interest often continues to accrue during these pauses, increasing your overall balance. As a result, deferment and forbearance are best used for short-term relief. Still, for student loan borrowers who are unemployed or dealing with unexpected expenses, this type of temporary payment pause can allow you the breathing room you need to stabilize your finances and get back on track.
Consider refinancing — but weigh the tradeoffs carefully
If you have good credit and steady income, refinancing your student loans can potentially reduce your interest rate and lower your monthly payments. This is especially helpful if you have high-rate private student loans, as it’s possible to find rates as low as 3% to 4% right now by shopping around.
Keep in mind, though, that refinancing your federal student loans means giving up protections like income-driven repayment plans and federal forgiveness programs. In turn, this option is generally best for borrowers who already have private student loans or don’t need the benefits that come with federal loans.
Tap into employer and state repayment assistance programs
Many employers have stepped up to help workers pay off student loans, offering contributions as part of their benefits packages. For example, some companies pay a fixed amount toward your loan each month or match your payments up to a certain limit. And, it’s typically worth taking advantage of these options, as even modest contributions from an employer can add up to thousands of dollars saved over time, making your balance more manageable.
In addition to the employer-based programs, many states have created loan repayment assistance programs for professionals, especially those in high-demand fields like healthcare, education and public service. These programs often provide substantial payments directly toward your loans in exchange for a service commitment, effectively reducing your out-of-pocket costs.
Set up autopay for an instant discount
While you likely won’t see massive savings as a result, one of the simplest ways to lower your student loan costs is to simply set up autopay on your account. Most student loan servicers, both federal and private, offer a small interest rate reduction, typically 0.25%, when you enroll in automatic payments. While the discount may seem modest, it directly lowers the amount of interest you’re charged each month, shaving money off your payment and helping you chip away at your balance faster.
Autopay also provides peace of mind by ensuring you never miss a payment, which protects your credit and avoids late fees. So, for borrowers trying to cut every possible expense, this quick adjustment is an easy win.
The bottom line
The landscape for student loan borrowers is changing fast, and waiting too long to act could leave you with fewer and costlier options. If you take steps now, though, to adjust your repayment plan, explore forgiveness programs or secure employer assistance, you can make your monthly payments more manageable and help you avoid financial strain. By being proactive about making your student loan payments more affordable, you can protect your budget and set yourself up for greater flexibility.
