Moneybox

What It’s Like to Navigate the Very Confusing Public Service Loan Forgiveness Program

The story of Bob Schneider, 39, a state government employee in Colorado.

39-year-old white balding man.
Olivia Fields

This is part of Debt Nation, a series of interviews with people about how student loans have shaped their lives. Read the rest here.

Education: Bachelor’s in political science, master’s in public administration
Current job: Colorado government employee
Household income: $130,000
Relationship status: Married with one daughter, age 9
Peak student debt: About $50,000 in 2006
Current student debt: $22,900

I’ve worked for state government since 2006. The Public Service Loan Forgiveness program, which forgives a portion of student debt for public service workers, is pretty much a disaster. I could find literally no information on the program for the five years after it was enacted in 2007. The first time I got any sort of detailed communication or found anything on the student loan services site was probably not until 2012.

I was in the top 10 percent of my high school, so that gave me automatic admission to a state school. I got accepted to the University of Texas at Austin, which was pretty affordable back then, especially for in-state people. [Editor’s note: When Schneider graduated, it was around $3,700 a year; now it’s more than $10,000.] For graduate school, I considered one private school and one state school, and the cost differential was pretty staggering. So I ended up going to the LBJ School of Public Affairs at University of Texas. I think it worked out, but it is definitely sobering when you’re looking at your choices and you realize you don’t really have much of a choice.

I joined the Peace Corps after I graduated from college in 2001. I was not really making any money then so I deferred my loans. In 2006, I consolidated everything. After all the interest, I think my student debt was up to about $50,000. That was from three years of undergrad and two years of a master’s program. I had a federal consolidated loan that wasn’t the direct federal consolidated loan, which is a requirement of the PSLF program. I didn’t realize that it didn’t qualify. So I consolidated into the right type of loan but had the wrong repayment plan. And that cost me a couple years. It definitely made my wife mad when she found out.

In the end, maybe I’ll have $3,000 or $5,000 forgiven. I’d almost not rather have it forgiven just out of the principle of it. But I work with people who have hundreds of thousands in debt from law school and they work at the state agency because it’s eligible for loan forgiveness. And that’s actually a big retention piece for us. If they weren’t able to get loan forgiveness, I think it would be pretty traumatic for them.

When I was just starting out in my career, having to pay $300 a month was a drag. And as I progressed, because I was on the income-based repayment plan, that payment keeps going up as you’re earning more. So I was like, “Oh hey, I just got a raise. Oh my payment just went up.” For a while, we didn’t really have a lot of child care expenses, since my wife was at home with the kid. Having one kid also was kind of a conscious decision just because child care is so expensive. My wife is from a different country, and so her income potential was slightly limited with non-native English and whatnot. But eventually she went back to work. Then I got a pretty big promotion and my student loan went from around $300 a month to $600 a month. I was like, “OK, well that’s definitely noticeable.”

I’m working from home now, which is lucky, but my wife’s job went away. She was working in a medical office and I think they wanted to limit staff. But with the $600 a week, she’s actually making more than she did working. I have federal consolidated loans and so they’ve been put on hold for now due to the pandemic. That’s actually probably the nicest thing to come with this, for us. It’s kind of funny though that they did it so quickly and easily. It shows how arbitrary federally subsidized student debt is as far as the rules and repayments and all that. It’s like they just snapped their fingers and made six months of debt payments go away. My daughter’s in fourth grade now, so she’s 9. So she has a little bit under 10 years for the federal government to get their shit together. But I’m not really holding my breath.

Bob Schneider is a pseudonym.