"Oh my God."
Three words uttered when someone is horrified, in shock or scrolling through Facebook pictures from middle school.
This time, I said those three words after an email notification popped up on my phone: Your Student Loan Snapshot. After my heart was done clogging my throat, leaving an empty space in my chest, I paused whatever show I was binge watching and braced myself.
Nothing could prepare me for the gargantuan Godzilla number I saw: $18,109.86. Eighteen-thousand, one-hundred and nine dollars. And eighty-six cents. In three years.
I gasped, putting my phone down. What did I do to deserve this? Was I a telemarketer in my past life?
No. I just decided to further my education like society told me to do. Society instructed me to do a lot of things when I was an impressionable young lad, and it instilled a fear of "flipping hamburgers."
The Federal Reserve Bank of New York reports that the average student-loan borrower, or masochist, owes about $26,000 in student loans. Do you know what I could buy with $26,000? A whole lot of chicken nuggets.
If that amount didn't make you mutter, "Oh my God," maybe this statistic will: Student debt has reached $1 trillion in the United States, according to the Consumer Finance Protection Bureau. I can't even fathom all those nuggets.
But there's this thing called the "Pay As You Earn" program. It has been around since 2012, but basically, nobody has heard about it. National Public Radio reported on June 9 that only 1.6 million borrowers have jumped aboard the PAYE plane, leaving the other 36 million on the tarmac.
Recently, PAYE hit the headlines as President Obama expanded the program (which was inaugurated in 2011), adding a bunch of cool things to alleviate the impending stress of current, future and past student-loan borrowers, which will take place in 2015.
PAYE runs alongside the Income-Based Repayment program, capping loan payments at 10 percent of discretionary income opposed to the 15 percent IBR offers.
And get this: After 20 years, the debt is forgiven (some can be forgiven after 10 years and the forgiven amount may be taxed, according to debt.org). Obama, take the wheel.
With Obama's changes to PAYE, the program extends to borrowers who took out loans before October 2007 and have not borrowed since October 2011. People can now say, "Thanks, Obama" without any sarcasm.
Honestly, I'm really bad at math, so I used the repayment estimator calculator on studentloans.gov to figure out my monthly payments. If I use the $26,000 student debt average and get a starting job with at least a $30,000 starting salary (shooting low, I know), my payments will be between $104 for my initial monthly payment and $272 for my final monthly payment for 210 months.
On the Standard Payment Plan, which runs for 120 months, my payments would be $272 a month.
With interest on the PAYE program, I will pay around $7,000 more than being on the Standard Payment Plan. So, will I pay more for a smaller monthly payment? Basically, yes. I'll have to delay expanding my budding shoe collection, I guess.
Not everyone qualifies, of course. You have to demonstrate a "partial financial hardship," states studentaid.ed.gov. You qualify "if the monthly amount you would be required to pay on your eligible federal student loans under a 10-year Standard Payment Plan is higher than the monthly amount you would be required to repay under Pay as You Earn."
I would qualify, but I feel terrible for the Americans who don't. Obama is making a tremendous effort, but everyone should be able to fly on the PAYE plane.
After calculating my payments, I felt a little weight lift off my shoulders. In the words of Gloria Gaynor, "I will survive." I made the decision to go to college (I think), and I couldn't afford it without student loans. How about we lower those tuition rates, huh?
The good news is I have about $2 in my bank account right now. I guess I better start taking care of my monstrous student loan debt.
Zachary Orsborn is a senior at Mississippi State University, studying communications. He is also the assistant editor of starkvillefreepress.com and a regular contributor to the Jackson Free Press. You can see him on the cover of this week's issue.
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