How to Choose a Student Loan Repayment Plan After SAVE

If you were enrolled in the SAVE plan, your student loans are in a transition period. A court order ended SAVE in March 2026, and loan servicers have been sending notices to former SAVE borrowers since July 1, 2026, in waves through the end of the year. Once you get your notice, you have a limited time to choose a new repayment plan. If you do nothing, a plan is picked for you, and it may cost a lot more each month.

This guide explains the deadline, compares the plans you can choose, works through an example with real numbers, and gives you a step-by-step checklist to make the switch.

What happened to SAVE, in plain terms

• SAVE was blocked in court and finally ended by a court order in March 2026.
• Most SAVE borrowers were placed in forbearance while the case played out. Interest started building again in August 2025.
• Forbearance time doesn’t count toward Public Service Loan Forgiveness (PSLF) or income-driven repayment (IDR) forgiveness. Qualifying payments you made before the forbearance still count.
• A new plan arrived: the Repayment Assistance Plan (RAP), created by the 2025 tax and spending law, became available on July 1, 2026.

Your deadline: 90 days from your servicer’s notice

According to Federal Student Aid, you have 90 days from the date of your servicer’s notice to pick a new plan. For example, a notice dated July 1, 2026 came with a September 29, 2026 deadline. Emails from Federal Student Aid don’t start the clock; the notice from your servicer does. Servicers also send a final 30-day reminder.

If you don’t choose, you’ll be moved automatically:

• to the Standard Repayment Plan, if none of your loans were disbursed on or after July 1, 2026, or
• to the Tiered Standard Plan, if you have a loan disbursed on or after that date that has entered repayment.

Both are fixed-payment plans, and payments are often higher than on an income-driven plan. Your servicer must tell you the new amount at least 21 days before the first payment is due.

The plans you can choose from

Plan	How payments are set	Good to know
Repayment Assistance Plan (RAP)	1% to 10% of your total adjusted gross income (AGI), minus $50 per dependent; $10 minimum	Unpaid monthly interest is waived; principal match; forgiveness after 30 years; counts for PSLF
Income-Based Repayment (IBR)	10% or 15% of discretionary income, depending on when you borrowed	Forgiveness after 20 or 25 years; counts for PSLF
Pay As You Earn (PAYE)	10% of discretionary income	Ends no later than July 1, 2028
Income-Contingent Repayment (ICR)	20% of discretionary income or a 12-year fixed amount, whichever is less	Ends no later than July 1, 2028
Standard, Graduated, Extended	Fixed or rising payments over 10 to 25 years	For loans disbursed before July 1, 2026
Tiered Standard	Fixed payments over a term based on how much you owe	Only fixed plan for new loans; doesn’t count for PSLF

Parent PLUS loans, and consolidation loans that include a Parent PLUS loan, are not eligible for RAP. If you have Parent PLUS loans, look closely at your remaining options before your deadline.

How the RAP payment is calculated

RAP uses your total AGI, not “discretionary income.” The percentage rises one point for every $10,000 of AGI:

• AGI of $10,000 or less: $10 a month
• $10,001 to $20,000: 1% of AGI
• $20,001 to $30,000: 2% of AGI, and so on
• $90,001 to $100,000: 9% of AGI
• Above $100,000: 10% of AGI

Divide the yearly amount by 12, then subtract $50 for each dependent you claim on your federal tax return. The payment can’t go below $10.

Two features make RAP different from older plans. If your payment doesn’t cover all the interest for the month, the unpaid interest is waived instead of piling up. And if your payment reduces your principal by less than $50, the government adds a matching principal payment, so your balance keeps going down.

Example: comparing three choices

Lauren is single with one child, has an AGI of $55,000, and owes $35,000 in undergraduate loans at 6% interest. She borrowed after 2014, so IBR would use 10% of her discretionary income.

Option	How it’s figured	Monthly payment
Standard (10 years)	$35,000 at 6% over 120 months	About $389
IBR	10% of ($55,000 minus about $31,700, which is 150% of the 2025 poverty guideline for a family of two), divided by 12	About $194
RAP	5% of $55,000 = $2,750 a year, divided by 12 = $229, minus $50 for one dependent	About $179

Her monthly interest is about $175, so on RAP her payment barely covers it. That’s where the principal match helps: her balance still goes down each month instead of stalling. The trade-off is time. On RAP, forgiveness doesn’t come until 30 years, while IBR forgives any remaining balance after 20 years for newer borrowers. If Lauren expects her income to rise quickly, the standard plan would cost the least in total interest. If she works for a nonprofit or government employer, RAP or IBR plus PSLF could clear her balance after 10 years of qualifying payments.

These figures are estimates. Poverty guidelines change every year, and your actual payment depends on your tax return and family size.

How to pick: start with your goal

• You’re going for PSLF: choose the income-driven plan with the lowest payment, usually RAP or IBR. Avoid Tiered Standard, which doesn’t count. If you have 120 months of qualifying employment, ask about buying back forbearance months.
• You need the lowest payment now: compare RAP and IBR in the Loan Simulator. RAP often wins for people with dependents or low incomes, thanks to the $50 per dependent reduction and the interest waiver.
• You want to be debt-free as fast as possible: a standard plan, or any plan plus extra payments, costs less overall. Lower payments over a longer term usually mean more total interest.
• Your income is unstable: an income-driven plan gives you a safety net, because the payment drops if your income drops when you recertify.

Step by step: switching plans before your deadline

1. Find your notice and deadline. Log in to your servicer’s website and note the date on your SAVE transition notice. Add the 90-day deadline to your calendar.
2. Update your contact information on StudentAid.gov and with your servicer, so you don’t miss letters.
3. Gather your latest tax return. Income-driven plans use your AGI. If your income has dropped since you filed, you can usually provide other proof of current income.
4. Run the Loan Simulator on StudentAid.gov to compare payments and total cost under each plan.
5. Apply for your chosen plan on StudentAid.gov or through your servicer. The application is free.
6. Turn on autopay once your new payment is set. Federal loans have offered interest-rate discounts for autopay, so check the current terms with your servicer.
7. Recertify every year. Income-driven payments are recalculated annually. Missing the recertification can raise your payment.

5 mistakes to avoid

• Waiting for the default plan. It’s often the most expensive option month to month.
• Paying a company to switch plans. Applying is free. The FTC warns that anyone charging upfront fees to “enroll” you in forgiveness is a red flag.
• Ignoring the interest that built up since August 2025. Check your current balance before comparing plans.
• Assuming forbearance months counted toward forgiveness. They didn’t, unless you buy them back where allowed.
• Letting student loans crowd out savings. A lower payment is only useful if the money goes somewhere. Use it to build an emergency fund or pay off higher-interest debt.

If your payment changes your monthly math, our guide on making a budget on a tight income can help you rebalance. And if you’re looking for a better-paying job to speed up payoff, see our guide on using salary ranges to negotiate.