Is The SAVE Plan Canceled?

[@garrettbailey_]

I am currently doing the double consolidation loophole. I just finished consolidating my loans with two servicers and now I need to consolidate them together and apply for SAVE. Does this mean I only have until Sunday to do the final consolidation and apply for the SAVE program? Also thank you so much for your videos! They're SOO helpful!!

[@EscapeStudentLoanDebt]

We're glad you enjoy the videos, thanks for watching! The Department actually issued a statement this weekend saying they will still accept paper applications for the SAVE plan, although they're pausing online applications. They also are going to immediately put people who apply for the SAVE plan on paused payments. We're going to do an emergency podcast on this on Monday. Hope this helps!

[@smlince]

Curious if you are reading, could you address if discretionary income's 'annual income' is the annual income versus adjusted gross income vs some other entity? Does recertification use total gross income or minus things like traditional 401k/HSA like for tax purposes? Thank you

[@EscapeStudentLoanDebt]

You have the option of telling your loan servicer your total annual income instead of your adjusted gross income, but I can't think of a reason why you would unless your income has decreased since the last time you filed taxes. Adjusted Gross Income is typically going to be lower than your total annual income, because things like pre-tax 401(k) contributions, HSA contributions and more will lower your Adjusted Gross Income. So you would typically want to use the Adjusted Gross Income from your previous tax return unless you've experienced a significant pay decrease.

[@smlince]

@@EscapeStudentLoanDebt Great! So if I understand, AGI is the default everyone uses unless there is some odd exception, and therefore, I ought to dump as much as I can into a traditional 401k and HSA to get AGI as low as I can for BOTH tax and for federal student loan monthly obligation when I re-certify next Jan (first time since leaving residency), that way I have flexibility to go low on that each month next year (even though I intend to surpass it by a lot). We are on same page? Thank you!