Shirin Tajani, 46, went back to school in 2011 to get her nursing degree and has been practicing in the field ever since.
Tajani moved to the United States from Pakistan at the age of ten. Her parents wanted to give her the opportunity to take advantage of the U.S. higher education system. In 2002, she graduated with a bachelor’s degree in business administration and initially worked for a corporation. However, after her discharge in 2009, she decided to become a nurse.
That’s where the majority of her student loans come from, and while she now makes six figures, according to documents viewed by BI, that’s not enough to pay off the balance and cover other expenses like rent. She’s even taken on a second job alongside her full-time nursing career to make ends meet, meaning she now works six days a week.
“I was in a situation where I had to change direction and change my career so I could stay grounded,” Tajani told BI. “I just feel like this country has let us down. You have to come here, you weren’t even born here, you didn’t even go to school and then you’re tied to these loans.”
Tajani’s student loans are currently in forbearance due to legal challenges related to President Joe Biden’s new income-driven repayment plan, known as SAVE. Tajani said she received monthly payments of about $250 under that plan – significantly less than the nearly $600 she was paying previously.
Right now, she’s waiting for a final court decision on the SAVE plan. She’s one of millions of Americans struggling with consumer debt. The New York Federal Reserve recently found that Americans now owe a record $1.14 trillion on their credit cards, with balances up 5.8 percent from last year. Credit card interest rates are also at record highs, making it even harder for consumers to pay off their debt.
When it comes to student loans, Generation X and Baby Boomers have the highest median balances, according to a recent report from the New School’s Schwartz Center, preventing many of them from achieving their financial goals later in life.
With rising housing prices and high interest rates in recent years, coupled with an increase in consumer debt, Tajani said she feels depressed and unable to move forward financially – especially after working as a front-line nurse during the pandemic.
“I’m trying to stick to a budget and reduce expenses, and it’s difficult. It’s really difficult,” she said. “We’ve basically repositioned ourselves, but we end up getting penalized for it.”
“It is sad to see so many of us suffering”
With interest rates so high to combat inflation during the pandemic, it’s no surprise that Americans are struggling with consumer debt while also meeting other basic expenses. Chicago Federal Reserve President Austan Goolsbee told BI that the level of delinquencies on consumer goods such as credit cards is “a little below normal.”
“The number of arrears is worryingly high and this is a warning signal,” he said, referring to possible signs of an economic downturn.
Tajani is doing everything she can to get out of debt, but she has some private student loans in addition to her federal loans, making it difficult to keep track of all her debt. That’s why the SAVE plan is so important to her – it would allow her to make manageable payments so she can focus on paying her other expenses.
“I have to work my second job to pay back my loans, otherwise I wouldn’t be able to make the payments,” Tajani said. “I just don’t think it’s fair that all these lawsuits are blocking these programs for us. And it’s sad to see how many of us are suffering because they think our country is helping us, and they’re not doing anything about it.”
While the SAVE plan is blocked, the Department of Education is working to implement other relief measures, such as the more comprehensive version of student loan forgiveness under the Higher Education Act of 1965. The department plans to start providing this relief to borrowers in October, but legal challenges to that plan are already looming, so borrowers will likely be delayed in taking advantage of the relief, if at all.
For now, Tajani remains hopeful that relief will come one way or another, but is aware of the uncertainty that the lawsuits and the election could create.
“Right now we’re just waiting and seeing what happens. I hope they do something because I’m sure the government doesn’t want people to default on their payments and that could put a lot of people’s livelihoods at risk,” she said. “So I hope something happens, but I just don’t know when that’s going to happen.”
Are you struggling with consumer debt? How has it affected your financial decisions? Share your story with this reporter at [email protected].
