What will happen to the savings plan in November 2025?

For millions of federal student loan borrowers, the upcoming end of the Savings on Value Education (SAVE) plan has left a mixture of confusion and cautious relief. After a court ruling blocked the plan earlier this year, Congress finalized its end through the One Big Beautiful Bill (OBBBA), which was signed into law on July 4, 2025.
The law not only eliminates savings, but also rewrites the framework for income-driven repayment (IDR) plans, phasing out many existing plans by July 2028. The new Repayment Assistance Plan (RAP) is scheduled to launch in July 2026.
Until then, borrowers enrolled in the SAVE program remain stuck in an administrative deadline: they owe no payments, but interest accrues again as of August 1, 2025.
This means that loan balances are growing even as borrowers wait for the Department of Education (ED) and the courts to decide when repayments will resume. But should you keep waiting for a save? Maybe not much longer…and here’s why.

What’s happening now: Endurance, interest, uncertainty

SAVE borrowers aren’t required to pay at the moment – but that’s not as good as it sounds. Although forbearance temporarily suspends payment requirements, it does not count toward Public Service Loan Forgiveness (PSLF) or future IDR cancellation.
This pause effectively freezes progress toward forgiveness programs, and as interest accrues, balances can rise by hundreds or even thousands of dollars each year.
Adding to the uncertainty: The Department of Education has not yet announced when SAVE borrowers should resume payments. They probably won’t have to (because they legally can’t) – but they will be asked to move to another payment plan.

The most likely scenario at the moment seems to be that borrowers can afford to save until they choose another option. A negotiated rulemaking committee is currently deciding how the end will come — the Department of Education wants borrowers to opt-in, or otherwise return to standard (then default) repayment, and other groups want automatic migration to the RRP.

For now, the ministry is signaling patience. Several loan providers, including Nelnet, have extended their SAVE forbearance notices until 2028, although this does not mean payments will remain on pause for long. It also doesn’t mean you should wait to take advantage of your financial situation.

the next The court hearing was supposed to take place in late Octoberbut will be postponed until 30 days after the end of the government shutdown. However, borrowers shouldn’t expect much news from these matters – they are more just logistical matters than any sweeping change.

What borrowers can (and should) do now

While the timeline remains unclear, borrowers can still make meaningful choices about their loans. The most pressing question is whether to quit saving now or wait until the RAP starts.
Option 1: Switch to Income-Based Repayment (IBR)

Borrowers who want to continue earning credit for forgiveness should strongly consider switching to IBR, especially if they work in public service or have low income. This is especially true for borrowers affected by the government shutdown.
Under IBR:

• Borrowers after 2014 pay 10% of discretionary income while borrowers before 2014 pay 15%.
• Payments may be as low as $0 for low-income earners.
• The time spent in IBR is counted towards PSLF and IDR cancellation.

This is a strategic move for those on the path to forbearance or with low enough income to maintain affordable payments (or even $0).
Importantly, borrowers who switch now will have their monthly payments calculated based on their 2024 tax returns, which could mean lower payments if their income rises in 2025.

Finally, PAYE could be the best option for some for the next year or two, but as it is being phased out, we generally recommend IBR.
Option 2: Wait for a Repayment Assistance Plan (RAP)

For low- or moderate-income borrowers, a Repayment Assistance Plan (RAP) can be the least expensive option in the long term.
RAP payments are expected to begin in July 2026 and will range from $10, up to 10% of adjusted gross income (AGI).
This could result in lower IBR payments for many borrowers – especially for those making less than $100,000 per year. Staying patient until a resettlement plan begins may make sense for those who:

• I currently cannot afford payments under IBR, or
• Want to know if RAP offers better terms?

However, remaining in tolerance means not progressing toward forgiveness and continuing to accrue benefits.
Option 3: Move to standard payment

Borrowers who can afford fixed payments and want to pay off their debt faster may consider standard, extended, or tiered plans. These plans are less flexible but guarantee repayment and expected completion within a specified period of time.

Special Considerations: PSLF, forgiveness, income, taxes

Borrowers seeking Public Service Loan Forgiveness (PSLF) should not stay in savings mode longer than necessary. Since PSLF requires 120 qualifying payments under an IDR plan, months spent in SAVE pause are not counted.

Yes, you may be eligible for PSLF’s “buyback” process, which allows them to make retroactive payments to account for months of forbearance. However, this is currently limited to borrowers who already qualify for PSLF forgiveness now — not those who are still working toward the ten-year mark. The timeline takes more than a year.

Borrowers who have completed 20 years (240 months) or 25 years (300 months) of qualifying IDR payments also need to change repayment plans. Remission cannot be processed under a SAVE plan, but can be processed under IBR, ICR or PAYE. If you reach time-based loan forgiveness, you must move to one of the qualifying plans.

It’s important to note that the Department of Education has clarified that no tax bomb will apply to loan forgiveness in 2025. Your forgiveness eligibility date will be when you pass that time milestone — not when your forgiveness is actually processed.

Who should wait?While most borrowers should leave the SAVE program, there are a few who may want to wait. If you’re retiring or see your income falling significantly next year, waiting to certify your income at the new lower level may be smart.

Finally, if you need to solve larger budget issues (because you can’t afford an IBR or RAP), you should use this time wisely to do so.

What does this mean for borrowers?

The shift away from SAVE marks the end of one of the most expensive repayment options ever. But for many, it also opens the door to simpler and perhaps more sustainable plans such as IBR or RAP.

However, borrowers must take an active role in getting through this period:

• If you are seeking forgiveness: Switch to IBR now so your payments continue to be counted.
• If you focus on affordability: Wait for the RAP to launch in mid-2026.
• If you can afford the payments and want to finish faster: Consider standard or extended repayment.

The worst step is not having a plan. You know your payment plan options: Standard, IBR or future RAP. Staying in a savings account indefinitely will only increase your balance and delay progress toward loan forgiveness.

Key takeaways

The end of the SAVE scheme has once again reshaped the payment landscape. Although uncertainty remains about the timing, the choices borrowers make next year will determine how much they pay and when they can become debt-free.

As interest rates rise and relief hours pause, more proactive borrowers will use this time to evaluate their next steps, whether that means switching to IBR now or preparing for the arrival of RAP in 2026.

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