Paying back student loans has shaped much of Hannah Purnell's early adult life, including her decision to live in a basement.
She was two years into paying back her loans when the coronavirus pandemic hit, upending the economy. Then-President Donald Trump announced a freeze on student loan payments. Purnell saw it as an opportunity to start whittling away at tens of thousands of dollars in student debt.
So she scoured Craigslist. She spent much of the pandemic's lockdown phase living with a large family in their basement, along with their grandmother, who doesn't speak much English. The cheap rent, about $500 a month, and her salary as an economic analyst meant she could pay $2,500 to $3,300 a month on her debts.
For more than two years, 41 million Americans with student loans have had more room in their budgets to build homes, save money or pay off other debts – all thanks to the government’s moratorium on federal student loan payments.
That pause is set to lift in May, though President Joe Biden's administration has signaled the freeze may be extended a fifth time. But increasingly, the moratorium is opposed by people on all political sides.
Conservatives are pressing for student loan repayments to start. A recent report from the Committee for a Responsible Budget, a nonprofit focused on government spending, estimated the freeze had cost taxpayers nearly $50 billion a year.
Progressive Democrats are pushing the president to use his executive authority to cancel student loan debt. Biden has repeatedly said it would be up to Congress to erase such debt, but lawmakers are divided on the issue.
While Washington debates the future of student loans, USA TODAY asked borrowers how their lives changed without the payments – and what a future without student debt might look like.
‘I’ve put off so many things’
Student loans affected more than where Purnell lived: They also influenced what she studied in college. The 24-year-old chose to study economics over planetary sciences at Pennsylvania State University because the former seemed more promising financially. And that would make it easier to pay back the tens of thousands in student loan debt she would owe upon graduation.
She also saved money by refraining from travel and avoided spending money with her friends. Her dating life suffered.
"I've put off so many things, the biggest being my ability to work at finding a partner, because of the debt," Purnell said. "The loans have been so limiting on my ability to make decisions about anything, because I don't want to fall behind on them."
Purnell knew she didn’t have to spend her life or money this way, but she could feel the weight of her debt growing every day. And it wasn’t only her name on the line.
Many students take out the individual maximums on their student loans but find that sum still isn’t enough to cover their individual costs. So they turn to their parents.
Purnell took out $21,200, and her parents borrowed another $72,400. She plans to pay off the whole sum herself, a process she started before the pandemic.
Purnell is on track to pay off all of the debt in May, the scheduled end to the moratorium. She is thrilled about her upcoming freedom, but she said she knows her path to a debt-free life isn't possible for many borrowers. And while she appreciates her education, she still wonders why the interest rate – as high as 8% on her largest loans – needed to be so high.
"Who is making that profit off what I am paying?" she asked. "And why are they making so much money?"
‘When am I ever going to be able to pay that back?’
Davlyn Edgett wants to pay back her loans, but after years of payments, it has started to feel as though her balance will never disappear.
She has about $187,000 in student debt from three degrees tied to education.
"I'm a teacher. When am I ever going to be able to pay that back?" she said.
Edgett pays about $300 a month on those loans, thanks to a government plan that ties her payment to her income. It's affordable, she says, but it also means she isn’t moving the needle on the overall balance she owes. She hopes the government will forgive her loans through its program for teachers.
The pause on student loan payments allowed her to make progress on other debts. She and her husband paid off several credit card balances, and they were able to build a new home in Colorado, where her family hopes to move.
The extra $300 a month made her family's life more manageable, she said. It will be a challenge to readjust her budget to live without it.
The freeze's reprieve from bureaucracy meant even more to Edgett.
For example, enrolling in the government's income-based repayment plans had required her to prove her income and spend time on the phone with loan servicers. And participating in the Public Service Loan Forgiveness program – recently expanded to include more teachers and nonprofit employees – requires even more paperwork. She hopes to clear all her debt through the program by 2028.
"If somebody forgave all my student loans and told me I didn't have to pay it, the best part of that would be the headache I didn't have to deal with," she said. "It's just not very easy to pay back your student loans."
The debt has made Edgett question the value of college. All her life, people told her an education would be the way to level up her career.
They have been right, to a degree. Her master’s degrees did help her as teacher, but that hasn’t translated to high enough earnings to pay back her debts in a timely manner. How can she tell her children to go to college, she asked, when she knows what it’s like to carry around a six-figure debt?
Freedom from living paycheck to paycheck
Charles Venino has tens of thousands of dollars in student debt but no degree from his time in college.
In his 20s, he studied pre-law at Ramapo College and later Seton Hall University, both in New Jersey.
His mother had gotten a job at Seton Hall, which helped reduce some of Venino’s costs, but he still had to work and take out loans to cover his rent, books and other living expenses.
The demands of his job made it nearly impossible to do the unpaid internships that felt necessary to succeed in his program. It felt like a “rich kid’s game.”
So he dropped out. He started attending a nearby auto school, Universal Technical Institute, that connected him with paid internships. He now works as a mechanic on hybrid vehicles for the Atlantic Health System, a nonprofit health care system in New Jersey, which would provide a comfortable living if not for his student loans.
He got started making payments on the debt during the pause, but a friend advised him to keep his money on the off chance the federal government would forgive student loans en masse.
Between private and federal loans, Venino says he had been paying about $1,000 a month. The freeze has allowed him to travel, pay down some credit card debt and a car loan and save up about $5,000.
"It was great," he said. "I have never not lived paycheck to paycheck before."
He said he wishes the federal government would do more to expand access to options like the Public Service Loan Forgiveness program. Because Venino works for a nonprofit, the possibility of forgiveness after 10 years in the job seems promising. But, he said, “it's shrouded in bureaucracy, physical paperwork, constant compliance checks and hurdles of general bull----.”
Easing "the burden of student debt" and "addressing college affordability" are priorities, the Department of Education said in a statement. Under Biden, the agency has forgiven $17 billion in student debt for more than 700,000 borrowers. That included a revamp to the public service forgiveness program.
But Venino is no longer holding out hope that Biden's administration will cancel student loan debt for all borrowers.
The American dream comes with student loans – and sleepless nights
Steve Martin, 36, knows on paper his six-figure salary looks generous, but his $120,000 in student loans, and his wife’s $37,000, limit how far it goes. What’s more, his wife stays at home to care for their child, which makes Martin the sole earner.
Martin was the first in his family to go to college. His path took him to several institutions before he earned a master’s degree at the University of Redlands in California. That opened a lot of doors. But, he said, “it’s kind of disheartening because I know I make about $100,000, went to school and did all of this, yet I can’t purchase a house.”
Martin first took out student loans at the since-closed University of Texas-Pan America in 2004. The college’s financial aid office made it easy for him to sign up for loans, he said. And his family couldn’t provide guidance about searching for colleges that may have been cheaper or provide more aid.
After dropping out and transferring schools a few times, Martin eventually earned a biology degree from Western Washington University. He had hoped to attend medical school, but felt his GPA of 3.2 wasn’t high enough. He parlayed the degree into a position working as an analytics manager in the defense industry, but soon felt he would need a master’s degree to stand out among his peers. That meant more debt.
Martin finished his master’s during the pandemic, which means his loan payments will be roughly $580 a month on the government's income-based repayment plan, or roughly $200 more than he had paid before grad school. The pause has given him breathing room, but he stays awake at night wondering how it will all be paid. In anticipation of the restart, his family sold one of their vehicles.
The family has also planned a move to Washington from Southern California for a position that will allow his family to save on commuting costs and eventually on child care.
He believes he should pay back the loans, but he wishes there was an easier way. For instance, he said, he would be willing to give up 2% of his salary for the rest of his working life to address his debt and fix his credit. That amount would be far less than the payment he's preparing to take on after the freeze ends.
“The repayment structure that is in place right now creates a negative cycle and makes it harder and harder for college students to succeed,” he said. “I didn’t know that the American dream came with the burden of student loans.”
‘If I had the capital to pay it, why not?’
When Mason Koch graduated from George Fox University, a private Christian school in Newberg, Oregon, he was happy to have "only" about $8,500 in student loan debt.
Koch, an All-American college golfer, said it cost about $46,000 a year to attend George Fox, about 23 miles southwest of Portland. Some of his classmates graduated with more than $80,000 in student loan debt.
To cut costs, Koch first spent two years at Green River College, a community college near his family's home in Auburn, Washington. Scholarships and help from a family friend helped him not take out too many loans.
But $8,500 is a lot of debt for a 23-year-old just starting out, he said.
After graduating in May 2020, Koch moved to California for 8 months and worked at the Sonoma Golf Club in Napa Valley, squirreling money away.
"I made $5,000 in tips at the golf course, and I suddenly realized if I set the money aside and didn't spend it on random things, I had enough to pay off about two-thirds of my student loans," Koch said. "I was sitting at a table doing a crossword puzzle, and I saw the due date got bumped back, and I had another year to do this."
Koch, now an assistant professional golfer at Fairwood Golf & Country Club in Renton, Washington, said he kept saving money and paid off his entire debt in December.
"With a finance degree, I did so many practice questions on how interest worked. When you go and look that it would cost me an extra $3,000 over six years to pay off the loans, and it was something I would have to do every month, it was a no-brainer," he said. "If I had the capital to pay it, why not?"
Koch said not having his student loan debt has given him money to invest or set money aside for an emergency.
"I don't have a significant other, but in the future I may have a mortgage for a house and that will be my only debt," he said. "I can't imagine graduating, getting married, buying a house and having student loans. … That seems like a lot."
Debt + inflation? Repayment feels ‘insane’
Misty Gardner-Hajek, a high school English teacher in Phoenix, wants to believe in the American dream. But $26,000 in student loans has her discouraged.
The freeze on her student loan payments has given her an extra $254 a month.
While that may not sound like much to some folks, Gardner-Hajek said she actually has a very small financial cushion.
"I'm a teacher, and I make just shy of $50,000. That's not a lot of money in the grand scheme of things," said Gardner-Hajek. In 2018, one year after she graduated from Arizona State University, the state's teachers walked out over low salaries, sparking a national movement.
"With that extra $250, I was able to buy groceries and pay down other debt," she said.
She joked that she even had a very small financial cushion.
"It was really nice to look at my bank account at the end of the month. I had $12."
When loan payments restart, she's worried she won't be able to make ends meet when she has to start repaying her loans.
"With inflation over the past year and a half, it's been absolutely insane, and everything is more expensive," she said. "We were told to go to college and pay (student loans) off with great jobs. … Here we are trying to live the American dream that was promised to us, but we are drowning in student loan debt."
Homeownership vs. going back to school
College loan debt for Jordan McKinney, once a student body president at Hampton University in Virginia, has affected his short- and long-term plans.
McKinney, a federal tech contractor, had considered buying a home last year when his $310-a-month loan payment was given a federal deferral with other Americans.
He qualified for a mortgage and was comfortable with that monthly payment. But when the student loan payments restarted, he worried his budget would be stretched thin, leaving him "house poor."
"With the quality of the home, it was tempting," McKinney said. "But I decided to sit out this round."
McKinney now plans to go to law school. He said he will enroll this summer at Widener University in Harrisburg, Pennsylvania.
"They gave me a good amount of scholarship money," said McKinney, who added he didn't want to significantly add more debt to the roughly $65,000 he already owes.
He said the law school decision came down to which university awarded him the most scholarships.
"The amount that it costs is at the top of my mind," McKinney said. "Name recognition (of the school) is one thing, but at the same time, I will follow the money."