Jubilee and Jubilation : An Examination of the Relationship between Public Service Loan Forgiveness and Measures of Well-Being

Little is yet known about the lives of those who are in Public Service Loan Forgiveness (PSLF) during repayment, as they approach forgiveness, or after the debt is discharged. With recent fixes to the PSLF program, an opportunity exists to better understand what participants’ lives “look like” and importantly, how remaining payments are related to selected behaviors and beliefs. This paper represents an initial analysis of the first round of data collection (N=785) within a wider mixed-methods study – and examined how remaining payments and forgiveness are related to financially-related outcomes (savings, FICO score, and homeownership) and subjective well-being (financial stress, psychological distress, life satisfaction, and job satisfaction). Findings suggest homeownership and FICO scores were related to forgiveness and remaining payments. In contrast, no strong trends between remaining payments or forgiveness and non-retirement and retirement savings measures were found. Next, relationships existed between forgiveness and remaining payments and measures of (dis)stress – specifically financial stress and psychological distress. Connections to life or job satisfaction are weaker. Finally, results suggest that individuals with between 37 to 60 remaining payments need increased psychological and socioemotional support, as suicidal thoughts and non-prescription drug use is elevated in these individuals. In summary, being closer to forgiveness or achieving debt relief is related to many positive outcomes – including increased FICO scores, a higher chance at homeownership, and lower (dis)stress levels. This study provides important information on the possible short-term effects of loan debt cancellation as compared to those in repayment – and in relation to those in proximity of forgiveness by remaining payments – and can serve as a future baseline to examine changes in these measures after the student loan repayment pause ends