If you’ve been relying on the SAVE Plan to manage your federal student loan payments, you may be wondering what happens next. Recent developments signal the elimination of the SAVE income-driven repayment plan—so it’s important to understand what this means for your budget and what options remain available.

Let’s break it down.

What Are Income-Driven Repayment (IDR) Plans?

Income-driven repayment (IDR) plans are federal student loan repayment options that base your monthly payment on your income and family size rather than the total amount you owe. These plans are designed to make student loan payments more affordable, especially for borrowers whose loan balances are high relative to their income.

For many borrowers, IDR plans have been a critical safety net—especially during periods of economic uncertainty.

History of the SAVE Plan

In 2023, the Biden administration introduced a new IDR option called the Saving on a Valuable Education (SAVE) Plan. SAVE was designed to offer the lowest monthly payments of any income-driven plan available.

Previously, the One Big Beautiful Bill had set the SAVE expiration date as July 1, 2028. However, the new deal, which is pending court approval, would end it even sooner than expected.

What Happens Going Forward

Without SAVE, several IDR plans remain available:

• PAYE (Pay As You Earn): Payments are generally 10% of discretionary income and forgiveness may occur after 20 years.
• IBR (Income-Based Repayment): Payments range from 10% to 15% of discretionary income, depending on when you borrowed.
• ICR (Income-Contingent Repayment): Payments are the lesser of 20% of discretionary income or what you’d pay on a fixed plan over 12 years.

Each plan has different eligibility rules, payment calculations, and forgiveness timelines, so it’s important to review them carefully.

Note: Under the OBBB Act borrowers enrolled in ICR, PAYE, or SAVE plans, must transition to a different repayment plan by July 1, 2028. Recent announcements indicate the SAVE plan may now be eliminated sooner.

How to Select a New Repayment Plan

If you’re affected by the elimination of SAVE, take these steps:

• Review your budget: Understand what monthly payment you can realistically afford.
• Compare repayment plans: Look at estimated payments, interest costs, and forgiveness timelines. The Department of Education offers tools and guidance when comparing plans.
• Recertify your income on time: Missing deadlines could result in higher payments.
• Explore refinancing options: Some borrowers may benefit from refinancing with a private lender, especially if they have strong credit and stable income.

Keep in mind that refinancing federal student loans with a private lender means giving up federal protections, including IDR plans and forgiveness programs. Be sure to weigh the pros and cons carefully.

The elimination of the SAVE Plan marks another major change in the student loan landscape—but it doesn’t mean borrowers are out of options. Other income-driven repayment plans remain available, and proactive planning can help you avoid surprises.

Staying informed, reviewing your repayment strategy, and seeking trusted guidance can help you navigate this transition with confidence.