SAVE plan (Saving on a Valuable Education)
Closing - vacated by the courts; ending · Income-driven · counts toward PSLF
SAVE plan (Saving on a Valuable Education). Was 5% of discretionary income for undergraduate loans (10% for graduate), with discretionary income defined as AGI minus 225% of the poverty guideline. This formula is no longer being offered to borrowers. Was 20-25 years (as little as 10 for small original balances). The future status of SAVE forgiveness credit is uncertain - verify at studentaid.gov. General information, not advice.
Source: Federal Student Aid - OBBBA updates. Data as of June 2026.
General information, not financial or legal advice. Federal student loan rules are changing in 2025-2026 under the One Big Beautiful Bill Act - figures here are estimates from public sources and the final program rules are still being implemented. Always verify with your loan servicer and studentaid.gov. See our disclaimer.
How SAVE works
Formula. Was 5% of discretionary income for undergraduate loans (10% for graduate), with discretionary income defined as AGI minus 225% of the poverty guideline. This formula is no longer being offered to borrowers.
Interest. Had a full unpaid-interest waiver. A court-ordered forbearance applied to many SAVE borrowers; whether that time counts toward forgiveness is unsettled.
Forgiveness. Was 20-25 years (as little as 10 for small original balances). The future status of SAVE forgiveness credit is uncertain - verify at studentaid.gov.
Availability. Closed. SAVE was blocked then vacated by federal courts in 2025-2026 and is being wound down. Borrowers must move to IBR or RAP. After July 1, 2026 SAVE borrowers have a limited window (about 90 days) to choose a new plan or be reassigned.
Worked example
This plan's payment depends on income and family size - use the calculators to estimate yours.
Estimate only. Try the calculators with your own numbers.
Pros and cons
| Pros | Cons |
|---|---|
| Was the most generous IDR formula while it operated | Vacated by the courts - no longer an option going forward |
| Forbearance months may not count toward forgiveness | |
| Borrowers must actively switch to IBR or RAP |
Eligibility
No longer open. Current/former SAVE borrowers should review IBR and RAP and confirm their next step with their servicer.
Frequently asked questions
Does SAVE count toward PSLF?
Yes. Payments under SAVE plan (Saving on a Valuable Education) count toward Public Service Loan Forgiveness (120 qualifying payments while working full-time for a qualifying public-service employer).
When is loan forgiveness under SAVE?
Was 20-25 years (as little as 10 for small original balances). The future status of SAVE forgiveness credit is uncertain - verify at studentaid.gov.
Who can use SAVE in 2026?
No longer open. Current/former SAVE borrowers should review IBR and RAP and confirm their next step with their servicer.
Compare with other plans
- Repayment Assistance Plan (RAP) · New - available July 1, 2026
- New tiered Standard plan · New - default for loans on/after July 1, 2026
- Income-Based Repayment (IBR) · Remains available (existing borrowers)
- Standard 10-year plan · Continues for existing borrowers
- Graduated repayment plan · Continues for existing borrowers
- Extended repayment plan · Continues for existing borrowers (balance over $30,000)
- Pay As You Earn (PAYE) · Closing - sunsets July 1, 2028
- Income-Contingent Repayment (ICR) · Closing - sunsets July 1, 2028
Sources & accuracy
Plan rules from Federal Student Aid - OBBBA updates and the U.S. Dept of Education. Data as of June 2026. The 2025-2026 rules are still being implemented - this is general information, not financial or legal advice. Verify with your loan servicer and studentaid.gov. See our methodology and disclaimer.
Last updated: 2026-06-22