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    Cancel Student Debt Is Trending And This Is What You Need To Know

    "Beautiful day to cancel student debt."

    Today Democratic senators Chuck Schumer, Elizabeth Warren, and others reintroduced a resolution asking the White House to make an executive action to forgive up to $50K in student loan debt for all federal borrowers.

    Drew Angerer / Getty Images

    They originally brought the resolution to the Senate last year, and Representatives Ayanna Pressley, Ilhan Omar, Maxine Waters, and Alma Adams headed up a similar resolution in the House of Representatives.

    It's still unclear if President Biden would actually go through with such a huge executive action. However, he has said in the past that he supports forgiving $10K in student loan debt for every borrower.

    The President continues to support the cancelling of student debt to bring relief to students and families. Our team is reviewing whether there are any steps he can take through executive action and he would welcome the opportunity to sign a bill sent to him by Congress.

    But his current plan for the $10K forgiveness involves working with Congress to get legislation passed. Commenting on this new resolution, Press Secretary Jen Psaki tweeted, "The President continues to support the cancelling of student debt to bring relief to students and families. Our team is reviewing whether there are any steps he can take through executive action and he would welcome the opportunity to sign a bill sent to him by Congress."

    Plus, legal experts are mixed on whether such an executive action could even succeed. While some believe that an executive action is the only way to bypass gridlock in the legislative branch, others think that signing this order would likely end in lawsuits and further disputes.

    Sooo, there are still ~questions~. But, IF the President decides to go ahead with this student debt cancellation plan, here's what that might look like.

    First things first, this student loan debt cancellation would only apply to borrowers who have government-held federal student loans, much like the current student loan payment freeze.

    Screenshot from Federal Student Aid listing the four types of federal student loans: direct subsidized loans, direct unsubsidized loans, direct plus loans, and direct consolidation loans.
    Federal Student Aid

    While it leaves out people with private student loans (since the Education Department doesn’t have legal authority over these), this action would have a dramatic effect on millions of federal student loan borrowers.

    And according to CNBC, canceling $50K in student loans would effectively wipe out all student loan debt for 80% of eligible borrowers, bringing the country's overall level of student debt from $1.7 trillion down to $700,000 billion.

    NBC / Via giphy.com

    Some say the measure could be a big step toward closing the racial wealth gap, as Black Americans and other people of color often graduate college burdened with more debt than their white peers. And women of all races also stand to gain from this potential action, as women currently carry about two-thirds of America's student loan debt.

    So naturally, Twitter weighed in on the issue, and the responses are kinda all over the map.

    Some people logged in to support the resolution:

    beautiful day to #CancelStudentDebt

    Student debt exacerbates existing racial inequities; cancellation will help reduce the racial wealth gap. Black Americans are more likely to take on student loan debt & struggle with repayment. That's one of many reasons we support the bicameral resolution to #CancelStudentDebt

    Twitter: @rweingarten

    And other people shared how student debt has personally affected them:

    Nearly 50 payments into my student loan repayment and I still owe the same amount of money I borrowed. 50 payments went towards interest. At times I feel like I borrowed money from the mob but instead of killing you, they just kill your soul. #CancelStudentDebt https://t.co/zDDGbd9G1K

    Twitter: @Ortiz_PhD

    But others chimed in to argue against the plan:

    #CancelStudentDebt is a BIG NO for me I'd say #CancelStudentDebtInterest To give younger people some economic relief BUT We need these same people to understand that BAD INVESTMENTS have consequences Or the longer-term consequences to society will be devastating

    Twitter: @RingMasterRa33

    Today would be a great day NOT to put the responsibility of bailing out my generations student loans on future generations. Instead, let’s turn this into a learning moment and implement a mandatory Fin Ed program for students so they learn from these mistakes. #CancelStudentDebt https://t.co/kQ6Vt2ruHe

    Twitter: @GavinHumble

    So now, I'm super curious — what do you think about this push to cancel student debt? Share your thoughts in the comments below!

    And in the meantime, you might also want to check out people's best tips for paying off student loans and more of our personal finance posts.

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