MEMPHIS, Tenn. — President Joe Biden has faced pressure since making a campaign promise to provide broader student loan relief and Wednesday, he acted.
“Using the authority Congress granted the Department of Education, we will forgive $10,000 in outstanding federal student loans,” President Biden said Wednesday.
In addition, students who come from low-income families which allowed them to qualify to receive a Pell grant will have their debt reduced by $20,000.
Here in the Bluff City, many of those we spoke to see this plan as a stepping stone to a more stable future. If the President’s plan survives legal challenges, it will provide relief for more than 43 million Americans.
“I think it’s an extremely positive thing for Memphis,” John Gnuschke, director of the Sparks Bureau of Business and Economic Research, said.
He believes the president’s plan will help “many areas of the south where people struggle to pay for a college degree. We all know investment in human capital is the way to ensure your future ... for young people, this was an extremely important day.”
Though Tennessee residents are less likely to have student loan debt, their average unpaid balance is often higher. Here in Shelby County, one of Tennessee's larger counties, the average borrower owes about $38,000 dollars with an average monthly payment of about $300.
“If I had to sum it up in one word, I would say 'relieved',” Courtney Logan, a seventh-grade teacher in Memphis, said.
While some aren't happy about this plan, there are many that see any potential relief as a step toward a more financially debt-free future.
“Reduction in your payment on a student loan would simply mean you can now afford a car, you can pay for inflated groceries, and you can take better care of your family,” Gnuschke said.
U.S. Military Veteran Lonnie Page is hopeful this loan forgiveness will allow them to invest and redirect their money into purchasing assets.
“But I did take some student loans out so that would really wipe out my student loans," Page said. "So that would be a great help for me to be able to take some of that money that I am spending on student loan payments and go ahead and try to save and build for my family.”