TL;DR
The SAVE Plan was terminated by court order. If you’ve been in SAVE forbearance, you are not in limbo anymore – your servicer is contacting borrowers now, and the 90-day clock starts when they reach you.
Interest on your loans resumed accruing August 1, 2025. Every month of forbearance has been adding to your balance, even if your payment said “$0.”
Time in SAVE forbearance does not count toward PSLF or IDR forgiveness. If you’re a public servant, those months are lost, making the next plan choice even more important.
Pick the wrong plan and your monthly payment can jump several hundred dollars. Miss the 90-day deadline and your servicer auto-enrolls you into a plan that almost certainly raises your payment.
Two new plans (the Repayment Assistance Plan (RAP) and the Tiered Standard Plan) launched July 1, 2026, alongside existing IDR plans (PAYE, IBR, ICR) and the Standard Plan. The “right” plan depends on your income trajectory, family size, loan type, forgiveness goals, and whether your employer contributes to your loans.
What actually happened to SAVE?
A federal court order terminated the Saving on a Valuable Education (SAVE) Plan. Borrowers who were enrolled (roughly 8 million people at the program’s peak) were moved into administrative forbearance while the legal questions worked through the courts. That forbearance is now ending.
Two things changed during the SAVE pause that matter to you right now:
- Interest started accruing again on August 1, 2025. The interest-free period that came with SAVE is over. Every month you’ve been in forbearance since then has added to your balance.
- Forbearance months don’t count. Time spent in SAVE forbearance does not count toward Public Service Loan Forgiveness (PSLF) or income-driven repayment (IDR) forgiveness. For PSLF borrowers, this is potentially years of lost qualifying payments.
Source: Federal Student Aid borrower notice
What you need to do, and by when
Your loan servicer is contacting borrowers in waves. When you receive their notice, you have 90 days to actively choose a new repayment plan. If you don’t choose, your servicer will move you into a default plan. This will most likely the Standard Repayment Plan or the new Tiered Standard Plan that launched July 1, 2026.
Quoting the Department’s guidance directly: “You must select a new repayment plan, or your student loan servicer will move you into a different repayment plan.” And: “Your monthly payment amount will most likely go up.”
If you’re on autopay, that draft amount will rise to match the new plan automatically.
What plans are on the table?
As of July 1, 2026, your options are:
- Repayment Assistance Plan (RAP) – the Department’s new income-driven option, replacing SAVE for many borrowers.
- Tiered Standard Plan – a new fixed-payment plan with tiers based on balance.
- Income-Based Repayment (IBR) – existing IDR plan, qualifies for IDR forgiveness after 20–25 years.
- Pay As You Earn (PAYE) – existing IDR plan (limited new enrollment).
- Income-Contingent Repayment (ICR) – existing IDR plan, the only IDR option for Parent PLUS borrowers (via consolidation).
- Standard Repayment Plan – 10-year fixed payments, the default if you don’t choose.
Each plan calculates your monthly payment differently and produces a different total cost over the life of the loan, a different forgiveness timeline, and a different interaction with PSLF.
Why is this harder than it looks?
On paper, picking a repayment plan looks like a calculator problem: lowest payment wins. In practice, the inputs are tangled:
Your income today vs. your income in 5 years.
IDR plans recalculate every year. Picking the lowest payment today can backfire if your income jumps and the payment recalculates to a number you didn’t budget for.
PSLF math is unforgiving.
If you’re pursuing Public Service Loan Forgiveness, only certain plans generate qualifying payments. The wrong choice can add years to your forgiveness timeline – or worse, push you off the path entirely.
Family size, spouse income, and joint vs. separate filing all change the answer.
IDR plans factor in family size, and some look at spousal income depending on tax filing status. Decisions you’ve already made for the 2025 tax year (married filing jointly vs. separately) affect what your 2026 payment will be.
If your employer contributes to your loans, your math is different.
Employer student loan contributions can change which plan minimizes your out-of-pocket cost. They can also create paid-ahead status that interferes with PSLF qualifying months.
The interest already accrued is now part of the conversation.
Depending on which plan you pick, that interest may capitalize (get added to principal) at a specific event – like leaving forbearance, or switching plans. Capitalization makes future interest grow on top of the interest you already owe.
What happens if you do nothing?
Your servicer enrolls you in the Standard Repayment Plan or Tiered Standard Plan after the 90-day window closes. For most borrowers coming out of SAVE forbearance, this means:
- A higher monthly payment than you were paying before SAVE.
- No PSLF qualifying payments in months under Standard if you’re a public servant pursuing forgiveness (Standard doesn’t qualify for PSLF unless your payment under Standard is equal to or higher than what an IDR plan would require).
- Autopay drafts increase automatically if you’re enrolled, with no separate confirmation.
- No way to backdate a better choice. Once you’re auto-enrolled, switching later means starting fresh – your forbearance months still don’t count, and the months under the wrong plan may or may not count depending on the plan you move to.
The 90 days isn’t a soft deadline. It’s the difference between making a deliberate decision and inheriting one.
Why this is exactly the moment to work with a guide like SavvyFi
Servicer call centers can tell you what plans exist. They cannot tell you which plan is best for your situation, because they don’t have a holistic view of your finances, your career trajectory, your forgiveness goals, your tax filing strategy, your employer benefits, or how the new RAP plan compares to IBR for your specific numbers.
This is the exact problem SavvyFi was built for. Our coaches model the actual dollars across every plan, factor in PSLF and IDR forgiveness timelines, account for your employer contributions if you have them, and stress-test the plan against likely income changes over the next 5–10 years.
In May 2026, SavvyFi-coached borrowers averaged $130,200 in projected loan forgiveness and reduced monthly payments by $984. Many of those borrowers came to us during the SAVE pause unsure of their next move. The ones who choose deliberately end up in dramatically different financial positions than the ones who let the 90-day window expire.
Three things to do this week
- Check your servicer’s portal and your email (including spam). If you’ve gotten your notice, find the date – your 90-day countdown started then.
- Pull together the inputs: your current AGI, family size, tax filing status, loan balances by loan type, employer contribution amount if applicable, and your forgiveness goals (PSLF, IDR, payoff).
- Talk to a coach before you click. If you’re a SavvyFi member or your employer offers SavvyFi as a benefit, book a session. If not, this is the moment to ask your HR team whether they can add it.
FAQs
Q: I’m in SAVE forbearance. When do I have to act?
A: Within 90 days of your servicer’s notification. Check your servicer portal and email now – the clock starts when you’re notified, not on a single shared date.
Q: What happens if I miss the 90-day window?
A: Your servicer auto-enrolls you in the Standard or Tiered Standard Repayment Plan. Your monthly payment will almost certainly go up.
Q: Did interest accrue while I was in SAVE forbearance?
A: Yes. Interest resumed accruing on August 1, 2025. Every month since has added to your balance.
Q: Did my months in SAVE forbearance count toward PSLF?
A: No. SAVE forbearance months do not count toward PSLF or IDR forgiveness.
Q: What new plans are launching?
A: The Repayment Assistance Plan (RAP) and the Tiered Standard Plan, both effective as of July 1, 2026.
Q: Will my autopay amount change automatically?
A: Yes, if you stay on autopay and your servicer moves you to a new plan, the draft amount adjusts to the new plan’s payment. (Note: the 1% autopay rate reduction has a separate September 30, 2026 enrollment deadline.)
Q: I’m pursuing PSLF. Which plan should I pick?
A: It depends on your income, family size, and remaining qualifying payment count. This is exactly the case where a coach can run the numbers across all plans before you commit. RAP, IBR, PAYE, and ICR have different PSLF interactions.
Q: My employer contributes to my loans. Does that change my plan choice?
A: Yes. Employer contributions affect which plan minimizes your out-of-pocket cost and can create paid-ahead status that complicates PSLF qualifying months. Coordinate the plan choice with the contribution structure.
Q: Where can I get help making this decision?
A: SavvyFi’s coaching team is built for exactly this scenario. Book a session here.
About SavvyFi: SavvyFi is a user-friendly fintech platform that makes it easy for employers to provide college savings and student loan benefits to their employees. Because the company’s platform is “zero-touch” to HR — without any complicated systems, integrations, or paperwork — SavvyFi unlocks education financing capabilities to even the smallest employers that would not otherwise be able to offer these benefits.
Disclosure: Third-party quotes shown may not be representative of the experience of all SavvyFi customers and do not represent a guarantee of future performance or success.
