Court strikes down Biden’s SAVE plan: Here’s how students can still tackle their debt

The US 8th Circuit Court of Appeals has struck down the SAVE (Saving on a Valuable Education) plan, bringing former President Joe Biden’s ambitious student debt forgiveness initiative to an abrupt halt. The ruling, delivered on Tuesday, sided with Missouri Attorney General Andrew Bailey and other Republican-led states, declaring that the education secretary had overstepped legal authority by prioritizing mass loan cancellation over structured repayment. While the decision immediately blocks the SAVE plan, its consequences stretch beyond the present administration—setting a legal precedent that limits future presidents from pursuing sweeping debt relief.
According to the Education Data Initiative, total student loan debt in the US surpassed $1.7 trillion by the end of 2023, making it one of the most significant financial burdens on American households. For millions of borrowers who had counted on this plan to ease their financial burden, the ruling forces them to confront repayment without the support they once expected.

What is the SAVE Plan?

The Saving on a Valuable Education (SAVE) plan was presented as a more sustainable and legally defensible alternative to Biden’s previous loan forgiveness initiative. The programme aims to lower borrowers’ monthly payments based on their income, with some qualifying for zero-dollar payments. Additionally, borrowers with an original balance of $12,000 or less would see any remaining debt forgiven after ten years of consistent payments. Designed to provide targeted relief, the SAVE plan sought to make higher education financing more manageable for millions of Americans.

SAVE plan in legal crosshairs

On Tuesday, a US appeals court ruled that the Biden administration lacked the authority to implement the SAVE plan, marking a significant setback for proponents of student debt relief. The St. Louis-based 8th US Circuit Court of Appeals sided with seven Republican-led states that argued the plan unlawfully shifted financial responsibility onto taxpayers. This decision aligns with previous legal challenges that have hindered Biden’s broader student loan forgiveness efforts.
The ruling builds on earlier court decisions that temporarily blocked the SAVE plan’s enforcement. Notably, the Supreme Court had already denied the administration’s request to lift a freeze on the program, reinforcing the judicial skepticism surrounding executive-driven debt relief initiatives. The Missouri federal appeals court had previously issued a nationwide injunction, preventing the Education Department from proceeding with the plan while litigation over its legality continues.
With President Donald Trump back in the White House, the prospects for large-scale student loan forgiveness have diminished further.

How can students repay loans without the SAVE plan saving them?

With the 8th Circuit Court of Appeals striking down the SAVE plan, millions of student loan borrowers are now left uncertain about their repayment options. If you were enrolled in SAVE or expected relief under the plan, you might want to explore Income-Driven Repayment (IDR) plans other than SAVE that remain available. The primary alternatives are: