You are not alone in navigating student debt changes. Here is what you can do

Elizabeth Hill saw going to college as her way out of poverty. But 26 years later, she is still paying back student loans, with around $145,000 still left to go.

“I've been able to stay afloat, but I do not have $145,000 to give them,” Hill said. “My debt-to-income ratio has impacted my ability to do things because I've got this six-figure loan just sitting there on my credit report.”

Hill is a therapist who specializes in care for Black, brown, indigenous, queer and trans people. And as an autism assessor, she was relying on an Obama-era plan to have her loan forgiven. She said she signed up for a consolidation plan, and if her loan was in good standing for 20 years, her loan would be forgiven.

That option has ended, though, which means she is looking at a lifetime of repaying her debt.

July 1 brings a plethora of changes to student loans as the Trump administration’s One Big Beautiful Bill Act goes into effect. It ends the Biden-era SAVE plan, where monthly payments were calculated on income and family size, so now borrowers have to look into new repayment plans. And if you do not transition to a new plan, you will be automatically transferred to a plan. Some of the plans on offer could increase monthly payments by a couple of hundred dollars. And the new changes also set limits for how much prospective students can borrow — and could force them to seek out costly private loans.

California could feel those effects deeply. An analysis by the California Policy Lab found that around 11% of borrowers in the state were 30-plus days late on their monthly payments last September. That number was around 3.7% when the pandemic began. Around 10% of Angelenos were delinquent on their loans. Per an analysis from Protect Borrowers using federal data, the total student debt in the SoCal region was $70.7 billion, with over half of that number owned by women.

Trying to do good, at personal cost

Hill had a Pell Grant — financial aid from the federal government that does not need to be paid back — and work study to complete community college in Oregon. Then, at the age of 18, she took out loans in her name, as well as under her mother’s name, to attend San Diego State University for undergrad.

After she graduated, she tried to stay afloat and keep her loans in good standing. But to become a therapist, like she wanted to, she said she needed a graduate degree to increase her earning potential.

“I come from a family that didn't have any money, and the only way to go to school was to take out these loans,” she said. “There was no advisement — this is what the interest is going to be; this is how much you're going to pay back. I'm 18 years old, just signing stuff so I can get into school.”

As a therapist, Hill said, she works with “the most marginalized populations because that's where my heart is, that's where I feel the most comfortable, and I'm a member of those populations as well.”

But that means she has to also work on a sliding scale.

“So the folk who can afford to pay the fee are almost essentially sponsoring the other ones who can't, if that makes sense. It's almost like a system of mutual aid,” Hill said.

Despite doing this work helping uplift marginalized communities for around 25 years, Hill said, there is no reward for it.

“I'm still expected to come up with over six figures to pay back the government,” she said.

No job plan, just a repayment plan

Sara Alsheikh took out student loans to attend the University of California, Riverside.

College, she said, was a confusing time. She thought she wanted to pursue a career in psychiatry but then pivoted to linguistics.

“ It focused on language, etymologically, and then also, I love anthropology, I love culture, I love people, I love to travel, so linguistics seemed like the perfect match for me,” Alsheikh said.

When she graduated, she didn’t have a plan. But that did not stop the loan repayment.

“ I'm not really seeing the fruits of my labor, and immediately, I got to start paying my loans. So, it kind of felt like, did I make the right decision?” she said. “I think I'm still kind of in that limbo, where like, OK, I went to school, I was proud, and I was happy that I did this, but I don't know.”

She’s still uncertain whether she made the right decision to go to college, she said.

Alsheikh graduated in 2023 and the total loan amount then was around $25,000. Three years later, that number is still the same. She made some payments but had to take a break when she lost her job.

Alsheikh said she only had a “vague understanding” of what she was signing up for.

“ It was just packaged up nice, like, take loans because you need to go to school, and then you can get around it. There will be options for you,” she said.

Those options haven’t materialized. Instead, Alsheikh said, she and others have been “left to the wolves” to figure out a “suffocating and quite complicated” process.

And the upcoming changes mean her monthly repayment amount is set to jump from $50 to around $150 — and this is after she called up her loan servicing provider to figure out her options.

College, Alsheikh said, is encouraged and portrayed as a way to improve your financial standing. But now, she said, she feels like “money is at the center of education.”

Helping new students learn from her experience

Shirley Portal, a nurse turned financial professional living in Los Angeles, gets triggered every time she hears the term student loans.

“Everybody in my position that went to school had to deal with it, whether it's federal or private loans. I feel like there's a lot of miseducation, or actually no education at all on the subject,” she said. “When I went to school, I went to the office. I wanted to ask how to start, how to pay. The first thing they did is literally shove the name of the company they work with, the loaner, and they just recommended it, and that's it.”

The One Big Beautiful Bill Act ends the Biden-era SAVE plan, where monthly payments were calculated on income and family size, so now borrowers have to look into new repayment plans.

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Maria Grejc for NPR

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Portal took out a student loan with an 11% interest rate to pay for nursing school, a rate she said was “inhuman.”

And after graduating, despite a padded resume with volunteer work and high test scores, she still couldn’t get a job.

“I had to go back to work an office job just to pay those loans,” Portal said. And even then, she considered living out of her car to pay off the loans just because of how high her payment was.

And then came COVID-19, “a slap in the face,” she said.

“They begged us to work, which means I worked 20 days in a row. There was no equipment. I have pictures of me wearing trash bags as gowns that we cut, and there were no masks, so I worked the same mask for 14 days,” Portal said.

The overtime had a silver lining, though: It meant she could finally pay off her nursing school loans, which amounted to over $50,000 plus interest.

But all that overtime also meant she had to pay more taxes.

“ I realized that I'm paying a lot more taxes than I should because I simply worked overtime. I worked holidays while everybody else sat at home and got paychecks,” Portal said.

It was at that moment that she decided to switch careers.

“I'm done being used and abused. This job is already hard mentally, physically, and then after COVID, there was zero appreciation,” she said.

Now, Portal works as a finance professional helping borrowers navigate student debt and taking hold of their finances.

And as borrowers reckon with the changes to their monthly payments because of the Trump administration’s One Big Beautiful Bill, she’s on hand to help.

How should students navigate the new loan changes?

Celina Damian is California’s student loan ombudsperson, appointed by the state to investigate complaints into loan service providers.

With the incoming changes to federal student loans, she said, it might lead to prospective students and families turning to riskier types of financing: private loans.

These have “higher interest rates, they don't have the forgiveness, discharge programs, the repayment forbearance options that federal loans do.”

Damian added that private loans would also require established credit worthiness, which might force students to look for co-signers. She hopes prospective students understand the implications of taking these loans and how it could impact their financial standing in the future.

“You really have to be making good decisions on the front end because then we're seeing this at the back end where I am, right, and I hear many borrowers that have regrets,” Damian said.

Damian advised prospective students and their families to understand their debt they could potentially be taking on. They can start by going to the California Student Aid Commission. Damian said they will help students fill out their FAFSA and help them determine the real cost of attending a school.

And if they are in school and run out of money, Damian asked students to really shop around and understand their options and understand things like fixed-interest rates vs. variable interest rates.

 ”There's scholarships everywhere, through your parents' employment, through the banks, through McDonald's,” Damian said. “But it does require work. It does require someone to start in the 10th grade sometimes, trying to get those scholarships.”