Months after the signing of President Donald Trump’s One Big Beautiful Bill, experts are beginning to calculate just how much borrowers can expect their student loan payments to increase each month. A recent report published by the borrower advocacy organization Protect Borrowers suggests payments could increase by $400 a month, on average, due to the shutdown of three Income-Driven Repayment (IDR) plans. We have everything you need to know about the projected increase, including expert-recommended tips for saving on your student loans, below.
What to know about a potential student loan increase
Earlier this month, Protect Borrowers (formerly the Student Borrower Protection Center) released an article stating that, due to the One Big Beautiful Bill Act (OBBBA), borrowers can expect their loans to increase by an average of $400 a month in the upcoming years. (Those with a Master’s degree can see spikes of up to $1,034 each month.) This expected spike is due to the act’s elimination of Income-Contingent Repayment (ICR), Pay As You Earn (PAYE) and Saving on a Valuable Education (SAVE) plans, all of which are considered IDRs.
“The OBBBA will have financially devastating consequences for borrowers, students and their families and will make paying for college more expensive and risky,” reads the report. “Millions of borrowers will be pushed toward costlier federal loan repayment plans, regardless of when they took out their loan.”
Expected new payments under the One Big Beautiful Bill
This increase is expected to take effect in July 2028, as the report claims that “the OBBBA allows them [current borrowers] to remain on their current repayment plans until no later than July 1, 2028. After that date, these borrowers will be forced to choose one of three plans: the new Standard Plan, the new RAP (Repayment Assistance) Plan or the current IBR [Income-Based Repayment] plan. Borrowers who do not make a selection will be automatically placed on the RAP Plan or, if they are ineligible for the RAP, IBR.”
And rates will rise. “A typical single borrower with a bachelor’s degree would pay $3,425 more per year compared to the SAVE Plan. The IBR Plan would force them to pay $473 each month, compared to $188 under the SAVE Plan—a monthly increase of $285,” the report continued.
“A typical family of four headed by a borrower with a bachelor’s degree would pay $2,806 more per year compared to the SAVE Plan. The IBR Plan would force them to pay $267 each month, compared to $33 under the SAVE Plan—a monthly increase of $234,” it continued. “A typical family of four headed by a borrower with a bachelor’s degree would pay $4,824 more per year compared to the SAVE Plan. The RAP Plan would force them to pay $435 each month, compared to $33 under the SAVE Plan—a monthly increase of $402.”
What is the Repayment Assistance Plan?
The Repayment Assistance Plan is a new program established under the One Big Beautiful Bill Act. It only applies to those who have a federal direct or graduate PLUS loan, and for those enrolled in it, their payment is reportedly going to be 1 to 10% of their annual adjusted gross income. Borrowers can expect to be enrolled in the RAP program for 30 years before they qualify for student loan forgiveness eligibility, meaning they will be in debt for far longer than before.
The program is expected to take effect in July 2026 for all new borrowers. However, as mentioned above, all current borrowers who are still enrolled in SAVE, PAYE, or ICR will be enrolled in it by July 2028.
“The OBBBA will substantially increase student loan costs for borrowers who take out loans after July 1, 2026. It does this by eliminating their access to all current Income-Driven Repayment (IDR) plans and forcing them to choose between either the new Standard Plan or a RAP—which is more expensive than almost every existing IDR plan and requires borrowers to be in repayment for 30 years before being eligible for cancellation, rather than 20 to 25 years,” reads the Protect Borrowers report.
How to save on student loans
According to the Student Aid website, you can save on student loans by paying them right away, signing up for an automatic debit, paying more than the minimum amount, using your tax refund to help pay it off and seeking out forgiveness and repayment options.
“There are a number of situations in which you can have your federal student loan balance forgiven. There are loan forgiveness and repayment programs for teachers, public servants, members of the United States Armed Forces and more,” the site says. “Most of these programs have specific eligibility requirements, but if you think you might qualify, you should definitely do some research. Also, research whether your employer offers repayment assistance for employees with student loans. There are many who do.”
