On October 1st, our government shut down, meaning many government agencies have been closed, and until a resolution and new budget bill can be passed, the government will remain shut down. Many government workers have been furloughed, meaning they are without work or pay until the government resumes operations. However, unfortunately, even during a shutdown, you are still required to pay off your student loans, even if they are owed to the federal government. Do not assume that there is no one on the “other end” to collect your loan. Despite many workers in the Department of Education being furloughed, you still have to repay your loans. The DOE is very constrained, though, with many workers being furloughed, so if you have a dispute or an issue with your loan, do not expect it to be resolved with ease. If you want to make changes to your loan, such as switching to a new payment plan, you may need to wait until the DOE is fully operational before doing so. I know this is frustrating and a severe inconvenience, but hopefully our policymakers can come to a compromise quickly so that our DOE can reopen. During this time you need to stay proactive. Since there is less guidance from the DOE, you need to ensure you are on top of your payments, interest due, and bank stamps, keeping note if something seems off. A Capital Compass recommendation is to keep detailed documentation of all your records just to ensure that if you need to circle back to something later, you have to record to prove what was actually transacted and what has been paid off. Another Capital Compass piece of advice is to stay informed, follow the news, and try to keep up with how the DOE is dealing with the shutdown. 

-Jack Sherman: Published 10/25

     On July 2nd 2025, President Trump’s Big Beautiful Bill was signed into law. This Bill brought about many changes to the federal student loan payment system, so Capital Compass is here to summarize the main points that you need to know! First, the Bill introduced new borrowing caps on federal student loans. Students can now borrow up to $27,000 in total in federal direct loans over four years of school. This is $4,000 lower than before the bill was passed. Additionally, the maximum loan amount for graduate students in federally directed funds is $90,000, a decrease of over $48,000 from previous levels. These caps are designed to ensure students are not over-borrowing and taking out loans that they will be unable to repay. The Bill also streamlined the repayment of loans into three concise options. You can either take out a standard 10-year loan, an income-based loan forgiven after 25 years, or an accelerated loan forgiven after 15 years. You don't need to worry about this, though, as you will be placed into a loan plan that is best suited for you based on your income. Prior to the bill, if you were seeking forgiveness on a loan as a public servant, a teacher, or a non-profit worker, you would have to fill out a plethora of paperwork. The bill has streamlined the paperwork and process for these workers to receive loan forgiveness. The bill has ensured that everyone who takes out a federal loan is financially literate. Before taking out a loan, borrowers must complete a one-hour online course titled “Money basics.” These new changes should bring some relief for students, as the process of taking out and repaying student loans has been streamlined into a much more concise process. However, these borrowing caps may make taking out student loans more difficult for individuals, suggesting that students should consider more private-based student loans with less stringent caps on borrowing. With these lower limits, Capital Compass recommends borrowing intentionally and only taking out what you truly need. The one-hour course on financial literacy is a good start, but Capital Compass advises going beyond this to ensure you are financially educated before taking out a large sum of money that will one day need to be repaid. 

-Jack Sherman: Published 9/25