Search Result for:
I - Economic and Political Environment
Browse:
Subject Area
Content Level
CE Type
Interest Area
Product Type
2 Results
Filter
Group By
01:03:25
Course recording
Video
Summary (AI Generated)
Derb Price Galt of Juneau presents an end-to-end overview of student loans, focusing on how advisors and borrowers can choose between federal repayment options, PSLF, and private refinancing amid major policy changes. He reviews the size of the market ($1.83T; ~92% federal) and walks through the borrowing timeline: FAFSA submission, aid packages, appeals, and funding gaps. Key upcoming borrowing shifts include new caps on Parent PLUS loans ($20k/year; $65k lifetime per student) and limits on Grad PLUS (generally $100k–$200k depending on program), increasing reliance on private student loans to close gaps.

On repayment, he explains federal plans are being streamlined: PAYE, ICR, and SAVE are expected to sunset by 2028, with SAVE currently in litigation and many borrowers in forbearance accruing interest and not progressing toward forgiveness. A new Repayment Assistance Plan (“WRAP”) launches this summer, using 1%–10% of AGI (generally 10% for higher incomes), offering interest subsidies and modest principal reduction, but requiring up to 30 years for forgiveness. Borrowers will generally choose between WRAP and IBR (old/new), with eligibility based on first-borrowed date; consolidations after July 1 may force WRAP-only eligibility.

He details PSLF (120 qualifying payments, tax-free forgiveness) and best practices like annual employer certification via the PSLF Help Tool, plus a potential “buyback” for missed months. Refinancing is framed as ideal for high-income borrowers not using federal benefits; it can lower rates, remove cosigners, and adjust terms, but permanently exits federal protections. Tax filing status (MFJ vs MFS) can materially affect IDR payments and must be weighed against tax costs. [Read More]
Slide handout
PDF
Summary (AI Generated)
This NAPFA presentation by Joseph Price-Gault (Juno) outlines how advisors can build holistic student-loan strategies across federal repayment, PSLF, and private refinancing. It frames the market (about $1.83T outstanding; ~92% federal) and emphasizes early FAFSA completion to maximize limited first-come aid.

Major policy changes begin July 1, 2026: new borrowing limits and a redesigned income-driven landscape. Borrowers who take a new disbursement or consolidate on/after July 1, 2026 will be restricted to the new Repayment Assistance Plan (RAP), while traditional IBR remains only for loans disbursed or consolidated before that date. The session highlights the practical importance of deadlines—especially July 1, 2028, when borrowers on phased-out plans must switch (or be auto-enrolled in IBR).

SAVE, introduced in 2023, is described as effectively nonfunctional: it was paused in summer 2024; time in forbearance doesn’t count toward PSLF/forgiveness; and interest resumed August 1, 2025. Advisors are urged to evaluate switching SAVE borrowers into IBR (old vs. new) or RAP rather than waiting.

PSLF fundamentals are reviewed (120 qualifying payments, qualifying employer, no acceleration, tax-free forgiveness), with best practices: use the PSLF Help Tool, submit employer certification annually, verify eligibility (especially in private practice), and document employment during forbearance for potential buyback.

Refinancing guidance distinguishes private refinancing from federal consolidation and stresses irreversibility: refinancing federal loans permanently forfeits federal protections (IDR/PSLF). A decision framework is provided: refinance private loans for better terms; keep federal loans when benefits matter; refinance only the private portion for mixed portfolios. Case studies illustrate when to refinance (no PSLF benefit, Parent PLUS modeling vs. ICR) versus when to stay federal (PSLF-track borrowers, residents).

Finally, the talk integrates loans into broader planning: cash-flow modeling, MFJ vs. MFS tax analysis, retirement contributions to reduce AGI (and IDR payments), and insurance/estate considerations. Advisors should reassess plans at least annually. [Read More]