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Every college major requires work, but some fields of study are more rigorous than others. For instance, you won’t find too many people who think that pre-med is a snap. While earning your undergrad degree isn’t going to be effortless, there are definitely some easier college majors out there that won’t be as taxing.

Choosing a less complex major doesn’t mean you’re doomed to a low-paying job for life. In fact, it can be quite the opposite. Read on to learn about 12 relatively easy college majors that can lead to jobs that pay well.

What Makes a Major “Easy”?

The workload for an easier major, like creative writing, probably won’t be as intensive as that of, say, biomedical engineering, neuroscience, or applied mathematics. You likely won’t have long lab sessions, tons of problem sets, and other arduous assignments.

This could make achieving higher grades a simpler proposition. Your noteworthy grades could, in turn, help you get a leg up after graduation. You might be able to step into a higher-paying job more easily, which could help you pay off any private school loans for college you might have.

A college major can also feel easier if it’s a field you’re interested in and passionate about. Your excitement about a major will likely make going to class something you’ll look forward to and the work required seem like less of a drag.

Recommended: A Guide to Choosing the Right College Major

12 Easy College Majors That Ultimately Pay Well

While getting an entry-level job paying a six-figure salary isn’t the norm for these easy college majors, you could still earn big bucks down the road.

Here, you’ll learn about 12 easy majors along with some average entry-level salaries and mid-career pay for positions within each field, according to Salary.com.

1. Marketing

A marketing degree opens up many career possibilities. People who major in marketing can find positions in all types of companies, industries, institutions, and nonprofits. Jobs in marketing include positions focusing on a business’s or brand’s strategy, sales techniques, advertising and communications, or public relations.

Marketing careers can pay off over time.

•   Average entry-level salary: $35,516 for a marketing assistant.

•   Average mid-career salary: $91,870 for a marketing manager.

As you see from that mid-career pay grade, a six-figure salary could be just around the corner.

2. Human Resources

With a college degree in human resources (HR), you can work in many different roles, including talent recruitment, benefits administration, DEI initiatives, or workplace development training.

In terms of landing a well-paying job, here are some salaries to note:

•   Average starting salary: $43,386 for an HR assistant.

•   Average mid-career salary: $94,576 for an HR manager.

3. Hospitality

Do you love looking at fab resorts and restaurants in your social media feeds? This major might be a perfect fit for you. With a degree in this field (which likely doesn’t involve any science labs), you might work in an array of positions. Some examples: hotel, resort, or restaurant management; event planning; or travel booking and tourism, among others.

Some salaries to note for this college major:

•   Average starting salary: $50,949 for an event planner.

•   Average mid-career salary: $76,898 for a hotel manager.

These figures are notably higher than $43,262, which Indeed cites as the current average starting salary in the U.S.

Recommended: Is $50K a Good Salary for a Single Person in 2024?

4. Communications

As one of the most popular college majors, a communications degree can prepare you for many different career paths. Marketing (mentioned previously) can fall under the umbrella of communications. Other areas for employment with this degree include public relations, advertising, journalism, writing, broadcasting, publishing, and social and digital media development.

A sample of the salaries you might expect at different points in your career:

•   Average starting salary: $51,928 for a corporate communications assistant or $45,955 for a social media assistant.

•   Average mid-career salary: $125,700 for a corporate communications manager and $116,090 for a social media manager.

5. Public Relations

Public relations (PR) has a broad reach. If you’re looking to capitalize on a degree in public relations, you might find a job in a small or large PR agency, a corporate PR department, or as an independent consultant to various clients. Since working in PR often involves frequent communication with clients and the public, this field can offer some of the better jobs for extroverts.

•   Average starting salary: $49,383 for a public relations specialist.

•   Average mid-career salary: $93,556 for a public relations manager.

6. Liberal Studies

A liberal arts or liberal studies major allows for a lot of flexibility and variety when it comes to job prospects. Students majoring in liberal arts or studies participate in a multi-disciplinary program, often including courses in humanities, history, art, literature, science, and philosophy. Earning a liberal studies degree can offer students a chance to develop many important “soft skills,” including problem solving, communication, and analytical and critical thinking.

Someone with a liberal arts degree may be drawn toward work in libraries, arts administration, government, or education and academia.

•   Average starting salary: $66,575 for a public policy analyst.

•   Average mid-career salary: $147,140 for a public policy manager.

7. Anthropology

Anthropology focuses on the study of humans in different cultures and societies, spanning various time periods and locations. It may not involve the kind of coursework that, say, studying law does, but it can be a fascinating field.

An anthropologist can work for ethnic or cultural organizations, museums, historical sites, research firms, or as a social or community services manager.

•   Average starting salary: $47,660 for a museum collectors curator.

•   Average mid-career salary: $64,962 for a museum director.

8. History

Knowledge of the past can be a powerful career springboard. Besides becoming a historian, history majors may find work in journalism, teaching, and politics. People with history degrees can also possibly find work at historical societies, museums, and libraries.

•   Average entry-level salary: $57,015 for a library archivist.

•   Average mid-career salary: $85,724 for a senior librarian.

9. Advertising

Advertising often taps a student’s interest in sales and contemporary consumer culture. Careers for advertising majors range from creative pursuits (copywriting or art direction, for instance) to more business-driven ones, such as being an account coordinator or a sales rep.

•   Average starting salary: $47,346 for junior copywriter, $45,686 for a junior graphic designer, or $43,300 for a junior sales rep.

•   Average mid-career salary: $122,524 for a copywriting manager, $122,236 for a graphic design director, or $107,183 for a senior advertising account manager, all of which can be a good salary for a single person.

10. English/Creative Writing

An English or creative writing major may be what many people consider easy. Depending on the path you take, it could lead to a high-paying job. People who choose this field may pursue a job as a proofreader, copy editor, technical writer, book editor, author, or an editor at a publishing company or magazine. These may all be lower stress jobs that are good for introverts.

•   Average starting salary: $44,750 for an entry-level proofreader.

•   Average mid-career salary: $98,101 for a senior editor.

11. Sports Management

Anyone who loves sports (whether participating, watching, or both) may be attracted to a major in sports management. Sports management encompasses a wide array of jobs, including becoming a sports agent, an athletic director, or a sports facility manager.

•   Average starting salary: $51,539 for a sports coordinator position.

•   Average mid-career salary: $69,061 for a sports manager job.

12. Criminal Justice

If you’re always watching procedural dramas on TV, you might be interested in majoring in criminal justice. While this field of study may be considered easy as compared with, say, a mathematics major, that doesn’t mean a career in criminal justice isn’t going to be challenging and rewarding.

Jobs for criminal justice majors can include working in the areas of law enforcement, forensics, investigations, and crime prevention.

•   Average starting salary: $50,733 for a fraud investigation officer or $56,376 for a police officer (plus, you might eventually qualify for federal student loan forgiveness programs) .

•   Average mid-career salary: $123,694 for a fraud manager or $90,671 for a chief detective position at a business.

Factors Besides Difficulty

Now you know 12 relatively easy majors that can lead to a job with high pay. But it’s worthwhile to consider some other factors that should be considered when choosing a college major.

Job Outlook

Some fields are growing faster than others. As you think about your major, it can be a good idea to make sure the one you choose will lead to a field that is growing and will have plentiful job opportunities after college. For instance, if you have a criminal justice degree and want to work in fraud investigations, you might find that there’s considerable growth in digital fraud and focus your education to prepare you for that kind of work.

Passion/Interest

Sometimes what makes coursework in college seem easy is that you love it. Ask any astrophysics major. They may think what they are studying is hard, but because they love it, the pursuit feels engaging and worthwhile.

In other words, if you are passionate about a subject, that can be a good reason to major in it, even if it has a reputation for being hard.

School Prestige

When it comes to getting a high-paying job after graduation, it can help if you pursue a program that your school is known for. For instance, some universities are renowned for having great journalism programs, and that reputation could give graduates an advantage in the job market.

The Takeaway

Getting an undergraduate degree, no matter what the major, requires hard work and dedication. However, there are some majors that fall into the “easier” category such as communications, anthropology, and history. These majors may not require as intensive a curriculum as others (say, chemical engineering), but grads can still go on to earn high salaries.

Regardless of whether your major is considered hard or easy, you may need some help paying for your education.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

FAQ

Is an “easy” major looked down on?

There may be some people who think certain majors are easy, but virtually all college majors require hard work. After graduation, hiring managers are likely looking for someone who performed well in school, is enthusiastic about their studies, and wants to apply their skills to their chosen career.

Do easy majors require less study time?

How much time and effort a college major requires can depend on the school, the curriculum, and a student’s approach to their studies and their aptitude. It’s not possible to say that all easy majors require less study time.

What are the highest paying majors overall?

According to a 2024 report from the National Association of Colleges and Employers, the highest paying majors are those in the STEM (science, technology, engineering, and math) category. The three highest paying majors are engineering, computer sciences, and math and sciences.

Photo credit: iStock/Drazen Zigic

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs. SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SOIS-Q224-1940086-V1

Federal student loans come from the government and offer perks like fixed interest rates and income-driven repayment plans, all set by law. Personal loans are issued by banks and other financial institutions with terms set by the lender, typically making them more expensive.

When it comes to paying for college, starting with federal loans is usually the most cost-effective option. However, if your federal loans aren’t enough, you still have options, from private student loans to scholarships and grants. While personal loans are a great resource for many large purchases, college tuition is not one of them.

Read on to understand the key differences between federal student loans and personal loans, including how they work and the purposes they’re best suited for.

What Are Student Loans?

A federal student loan is government-provided financial aid that covers educational expenses and requires repayment with interest. To apply, you must complete the FAFSA annually to assess your financial need. There is no credit check required for federal student loans.

Some federal student loans provide flexible repayment options, such as income-driven repayment plans that adjust payments according to post-college earnings, and forgiveness programs tied to specific occupations. Borrowers are free to modify their repayment plan after obtaining the loan.

There are several different federal student loan options, including:

•   Federal Direct Subsidized Loans: These loans are for undergraduates in need of financial assistance. The amount depends on college costs and family income, as determined by the FAFSA. The government usually covers interest while you’re in school.

•   Federal Direct Unsubsidized Loans: These are for undergraduates and graduate students. The amount you receive is determined by the cost of attending your school and not your financial need. Interest starts accruing immediately, and you can choose to pay it while in school or add it to your total repayment.

•   Parent PLUS Loans (Direct Parent Loans for Undergraduate Students): Allow parents to borrow on behalf of their undergraduate children. You must complete a separate application from other federal loans to qualify for these.

•   Grad PLUS Loans: Allow graduate and professional students to borrow money for education expenses.

What Are Personal Loans?

Personal loans are offered by banks and other individual lenders and can be used for just about anything. Common purposes include consolidating high-interest debt, home improvement, moving, family planning (think IVF or adoption costs), and major car repairs. Generally, a personal loan cannot be used for a down payment on a home, business expenses, investing, or college expenses. That’s right: Most lenders don’t allow borrowers to use personal loans to pay tuition and fees, or to pay down student loans. If you need funding for college outside of federal loans, it’s best to look into private student loans.

Personal loan lenders may offer variable or fixed interest rates, along with repayment periods typically ranging from one to seven years. To qualify for a personal loan, lenders review your financial history and credit score. It’s important to note that each lender has different terms and conditions, so it’s essential to understand the annual percentage rate (APR) and repayment terms before committing to a specific offer.

Student Loans vs Personal Loans: Key Differences

Purpose aside, here’s a breakdown of the key differences between student loans and personal loans.

Interest Rates

In general, federal student loans have fixed interest rates, meaning your rate remains the same throughout the entire loan term. For example, the average rate for Direct Subsidized and Unsubsidized Loans for undergraduates for the 2024-25 school year is 6.53%.

On the other hand, personal loans can have variable or fixed rates, and are often higher than federal student loan rates. Depending on the borrower’s creditworthiness, repayment term, principal amount, and the lender, personal loan rates vary widely, ranging from 7% to 36%.

Loan Forgiveness

With federal student loans, you may qualify for additional benefits, such as Public Service Loan Forgiveness (PSLF) and Teacher Loan Forgiveness (TLF). These programs can forgive your loan balance after a specific period or upon meeting certain criteria.

Personal loans, however, do not offer any loan forgiveness programs. Nonetheless, lenders may provide options to prevent default if you encounter difficulty making payments due to hardship.

Repayment Terms

Federal student loans provide several repayment plans ranging from 10 to 25 years, including options that allow you to lower your payments based on your income. Repayment can also be deferred while you’re enrolled at least half-time and immediately after graduation.

Personal loan lenders also offer different repayment terms, typically between five and 20 years, giving you the power to choose what works best for you.

Credit Requirements

Federal student loans are part of an overall financial aid package offered to students. To apply for these loans, you’ll need to fill out the FAFSA each year, typically between October and July. Federal loan approval is often based on financial need, and no credit check is required.

When applying for a personal loan, you’ll complete an application and undergo a credit check. Each lender sets its own criteria for approval, often requiring a credit score of at least 670. If you don’t meet the credit requirements independently, many private lenders allow you to apply with a cosigner. Having a cosigner with a strong credit history can improve your chances of approval.

Deferment and Forbearance Options

If you’re dealing with a short-term financial challenge, you might qualify for a deferment or forbearance on your federal student loans. During deferment, you can pause your payments temporarily. It’s important to note that subsidized loans won’t accrue interest, but unsubsidized loans will. This means any unpaid interest adds to your loan balance, increasing your debt. For forbearance, if you can’t make payments, interest continues to build on your loan balance.

Personal loans may also offer deferment and forbearance options, but each lender has different rules. Before taking out a personal loan, it’s important to understand these options in case you face financial difficulties.

When to Choose Student Loans

It’s a trick question to compare personal loans vs student loans for college expenses, since student loans are the only option. But even if personal loans were an alternative for college expenses, federal student loans make more sense due to their typically lower interest rate and additional borrower protections.

Those protections include income-driven repayment plans, loan forgiveness programs, and deferral and forbearance options, which can be really helpful if you hit a rough patch financially.

When to Choose Personal Loans

Personal loans are a good option if you have a major purchase coming up and want to avoid putting it on a high-interest credit card. Just be sure to compare personal loan options carefully to avoid piling up debt. To find the right loan and repayment choice, look for the one with the lowest overall cost by considering the loan amount, interest rate, term, and fees.

The Takeaway

When deciding between federal student loans vs. personal loans for funding college, personal loans are simply off the table due to lender restrictions. This shouldn’t pose a problem, though, because federal student loans offer a better deal for college students anyway, with fixed interest rates, income-based repayment plans, and forgiveness options. In the event that federal student loans don’t cover your total cost of attendance, consider a private student loan to bridge the gap.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

FAQ

Can I use both student and personal loans?

Most lenders don’t allow personal loans to be used for college expenses. However, if federal student loans don’t cover your full cost of attendance, you can apply for a private student loan to bridge the gap.

Do personal loans have borrowing limits for college?

Trick question! Personal loans can be used for just about anything, from home improvement to moving costs. However, there are a few exclusions, and college costs are one of them. Fortunately, private student loans exist for just that purpose, with borrowing limits up to your cost of attendance.

Are personal loan interest rates higher than student loans?

Personal loan interest rates are usually higher than federal student loan rates and private student loan rates.

Photo credit: iStock/Drazen Zigic

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs. SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

SOIS-Q224-1926103-V1

Student loans are a type of financial aid option that lets you borrow a lump sum of money upfront that you’ll repay over time later, with interest. Some students are unclear whether a student loan is a secured or unsecured debt.

Both federal and private student loans are considered unsecured debt. Keep reading to learn more on secured loans versus unsecured loans, pros and cons of each, and why student loans are considered an unsecured form of debt.

What Are Secured Loans?

A secured loan is a type of debt that requires borrowers to provide the lender with an asset of value to back the loan. This asset is called collateral. Collateral could be your home, your car, other property that has monetary value, a savings account, jewelry, and more. The type of collateral you put up is stated in the loan agreement.

If a borrower defaults on their loan and doesn’t pay it back, the lender can take actions to seize possession of the collateral. It then uses the proceeds from the sale of the collateral to recover the unpaid debt.

Common types of secured loans include:

•   Mortgage loans

•   Home equity loans

•   Auto loans

•   Some personal loans

Lenders typically view secured loans as less risky to their bottom line since the promised collateral offers them at least some financial protection. In turn, secured loans might offer lower interest rates compared to unsecured loans.

Certain secured loans are also designed as accessible financing for individuals whose credit doesn’t qualify for an unsecured loan.

What Are Unsecured Loans?

An unsecured loan is an installment loan that doesn’t require an asset or collateral upfront to secure the debt. Since this type of loan doesn’t offer an asset-based guarantee to the lender, the borrower must demonstrate a strong likelihood that they’ll repay the debt.

A positive and extensive credit history, consistent and sufficient income, and low credit utilization are some markers that lenders use to determine how risky a borrower is for an unsecured loan. Additionally, since lenders don’t have access to collateral to fall back on in the event of default, unsecured loans generally have higher interest rates.

Credit cards, some personal loans, and private student loans are considered unsecured loans.

Pros and Cons of Secured vs Unsecured Loans

Secured and unsecured loans have their own advantages and downsides. Furthermore, some benefits are only for certain types of secured or unsecured loans. Before signing a loan agreement, it’s important to understand the pros and cons of each option.

How Federal Loans Differ From Typical Debt

Students often wonder whether federal student loans are secured or unsecured debt. Both federal loans and private education loans are unsecured debt. However, federal loans have significant perks and protections that private student loans don’t offer.

Unlike private student loans that require a minimum credit score or cosigner, most federal student loans don’t require a credit check or a cosigner to qualify for a loan. The Direct PLUS Loan is the only federal loan that requires a credit check, but borrowers with adverse credit can still access a Direct PLUS Loan by completing a few additional steps.

Federal loan rates are fixed, meaning your monthly payment won’t change throughout your repayment term. With federal subsidized Direct Loans, the Department of Education pays for interest that accrues while your loan is in deferment (e.g., while you’re in school). Conversely, other unsecured loans aren’t subsidized and might have variable interest rates that change throughout your repayment period, making it hard to anticipate your budget every month.

You’ll also have access to a range of repayment options, including income-driven repayment (IDR) plans, which are exclusive to federal student loans. Some borrowers qualify for a required payment of $0 per month while enrolled in an IDR plan. Finally, federal student loans are eligible for federal student loan forgiveness programs that cancel a portion of your student debt after meeting minimum program requirements.

Managing Your Student Loan Debt

Getting a handle on your unsecured student loan debt can feel challenging as you balance other areas of your life. Below are a few strategies to help you manage your student loans:

•   Make in-school interest-only payments. If you can afford to, consider paying off the monthly interest that accrues while your loan is on in-school deferment. This applies to both unsubsidized federal loans and private loans. Making these small but meaningful interest payments can help you avoid interest capitalization (i.e., paying interest on interest) later.

•   Track when your loan payments are due. Be aware of your loan due dates and minimum payments each month. Late payments or missing a payment altogether can have a negative effect on your credit score, since loan repayment history is reported to the major credit bureaus.

•   See if you qualify for loan forgiveness or loan repayment assistance. The Department of Education offers a few forgiveness and cancellation programs for eligible borrowers with qualifying loans, like the Public Service Loan Forgiveness program for government and nonprofit employees. Some states also offer loan repayment assistance programs to workers in certain professions, like health care, social work, and law.

•   Reach out to your loan servicer or lender. If you’re struggling to make your student loan payment, your loan servicer or lender is your best resource. They can guide you through relief options that are accessible to you, whether that’s getting on a different repayment plan or temporary forbearance.

The Takeaway

A student loan is unsecured debt. Having to put forward collateral to get a student loan is a roadblock that you fortunately don’t have to worry about.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

FAQ

Are student loans considered secured or unsecured?

Student loans are considered unsecured debt, meaning they don’t require collateral from you as a condition of securing the loan. Since there’s no collateral tied to the loan, if you default on the debt, the lender might choose to take you to court in an attempt to collect some or all of the debt.

Is it possible to get a secured student loan?

No. Student loans are a form of unsecured debt. No collateral is required to get a student loan, whether you’re borrowing a federal or private student loan.

How are federal student loans different from private?

Federal student loans are guaranteed and funded by the U.S. Department of Education. They offer exclusive fixed rates, established annual and aggregate loan limits, non-credit-based eligibility criteria, and access to income-based repayment plans and loan forgiveness.

Private student loans are provided by private financial institutions, like banks, credit unions, online lenders, and schools. Private lenders offer fixed or variable loan rates, which differ between lenders. Your eligibility for a private loan involves various factors, like your income and credit history, and repayment terms and plan options vary.

Photo credit: iStock/DNY59

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs. SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

SOIS-Q224-1926124-V1

It’s challenging to get federal and private student loans erased in bankruptcy. But if you’re overwhelmed with student loans and other debt, you may be able to get some relief through Chapter 13 bankruptcy.

Unlike Chapter 7 bankruptcy, which involves liquidating assets to pay off debts, Chapter 13 allows you to restructure your debts with a new, more manageable payment plan. After three to five years on the plan, many outstanding debts are canceled. However, this may or may not include your student loans.

Even if your student loans don’t disappear, Chapter 13 reorganization could lower your monthly payments for several years and, by eliminating other debt, make it easier to repay them in the future. Because it has a major impact on your credit, however, Chapter 13 should only be used as a last resort.

Here’s a closer look at Chapter 13 bankruptcy and how it can impact your student loan situation.

Understanding Chapter 13 Bankruptcy

Chapter 13 is a type of bankruptcy that restructures your debt. It’s known as a “wage earner’s plan” because it enables borrowers who earn a steady income to develop a plan to repay all or part of their debts.

When you apply for Chapter 13 bankruptcy, you’ll make a list of all your debts, as well as provide information on your income and regular expenses. With the help of a bankruptcy trustee appointed by the court, you’ll come up with a plan for repaying your creditors on a three- or five-year plan. The plan will allocate your disposable income toward your debts on a “pro rata” basis, or proportionally based on what you owe. Chapter 13 repayment plans limit monthly payments to no more than 15% of your disposable income. Disposable income is the income left over after you’ve paid all of your essential expenses. Once you’ve completed the bankruptcy payment plan, the court will discharge the remaining balances of qualifying debts.

Student debt isn’t automatically considered a qualifying debt, though. To get your student loans discharged through Chapter 13 bankruptcy, you need to take an additional step of filing what’s called an “adversary proceeding.” As part of this filing, you must prove to the court that paying back your student loans would be an “undue hardship” for you and your family. While this used to be a highly complicated process, a policy change put into place by the Biden administration in 2022 simplified and condensed the paperwork involved. Student loan borrowers can now fill out a 15-page form that details their financial struggles and makes their case for student loan discharge.

Eligibility Requirements for Chapter 13

To file for Chapter 13 bankruptcy, you must meet the following requirements:

•   You have a regular income. You must have enough disposable income to make some payments on your debts. If your income is higher than the local median income, you’ll repay your debt over three years. If it’s below the median, you’ll repay your debt over five years.

•   Your debt is under the limit. Your combined debts must total less than $2.75 million.

•   You’re up-to-date on income tax filing. You’ll need to submit proof that you filed your federal and state income tax returns for the four tax years before your bankruptcy filing date.

•   You’ve received credit counseling. You must have received credit counseling from an approved agency within 180 days before filing for bankruptcy.

Meeting these requirements sets the stage for entering into Chapter 13 bankruptcy and working toward debt reorganization. To get your student loans canceled through bankruptcy, however, there are additional requirements. A bankruptcy court typically must find that:

•   You cannot presently maintain a minimal standard of living if you are required to repay the student loan.

•   Your financial situation is likely to persist into the future for a significant portion of the loan repayment period.

•   You have made good faith efforts in the past to repay the student loan.

Recommended: Strategies to Pay Back Federal Student Loans

How Does a Chapter 13 Bankruptcy Affect Student Loan Payments?

A Chapter 13 bankruptcy can affect student loan payments in the following ways:

•   It can reduce your monthly payments. Chapter 13 bankruptcy will base your debt payments on your disposable income. You’ll make payments to your appointed trustee, who will distribute these payments among your various creditors. Depending on the terms of the plan, your student loan payments may go down substantially.

•   It may temporarily delay student loan payments. Depending on your disposable income and the terms of your repayment plan, you may not have to pay anything toward student loans for a time during Chapter 13 bankruptcy. That said, interest will keep adding up on your loans, and you may face a greater debt burden when your Chapter 13 plan comes to an end.

•   It prohibits student loan collection. During Chapter 13 bankruptcy, an automatic stay will go into effect which prohibits credit collectors or loan servicers from harassing you and trying to collect the debt for up to five years.

•   You may be able to get your loans discharged. Filing for Chapter 13 bankruptcy does not in itself guarantee that your student loans will be discharged. But it does allow you to file an adversary proceeding. If you’re able to prove that repaying your student loans would cause extreme hardship, you may be able to get your loans canceled at the end of your repayment plan.

What Takes Place When Your Chapter 13 Case Comes to an End?

A Chapter 13 bankruptcy can eventually discharge some of your debts. But unless you were able to prove to the court that repaying your student loans would be a serious hardship, your federal or private student debt won’t go away. After the plan comes to an end, your lender or loan servicer will set you up on a new payment schedule with a recalculated monthly payment.

If you’ve been able to get rid of your other debts or increase your income over the years, you may be in a better position to afford your student loan payments. You can also explore various options for student loan relief or forgiveness.

An income-driven repayment (IDR) plan, for example, bases your monthly student loan payment amount on your income and family size. Under all IDR plans, any remaining loan balance is forgiven if your federal student loans aren’t fully repaid at the end of the repayment period (either 20 or 25 years).

Thanks to a new rule that went into effect in July 2024, borrowers in an IDR plan can receive credit toward forgiveness for each month of payments under a Chapter 13 plan. This is the case even If the borrower enrolls in an IDR plan during or immediately after the bankruptcy case is closed.

Will You Be Able to Apply for Student Loans in the Future?

Reorganizing your student loans through Chapter 13 bankruptcy should not disqualify you from taking out additional federal student loans in the future. However, you may not qualify for federal student loans or other types of aid if you have any loans in default.

You can get your loans out of default with the Fresh Start program through Sept. 30, 2024. After that, your options are student loan consolidation or rehabilitation to get loans out of default and back into good standing.

Qualifying for a private student loan or student loan refinancing after bankruptcy might be more difficult. Private lenders base their approval decisions on your creditworthiness. Lenders may view applicants with a bankruptcy history as high-risk, leading to higher interest rates or denial of loan applications. Chapter 13 bankruptcy can stay on your credit report for seven years.

You may be able to qualify for a private student loan or student loan refinancing by applying with a creditworthy cosigner, however.

The Takeaway

Filing for bankruptcy doesn’t necessarily mean that your student loans will be discharged. However, Chapter 13 bankruptcy can give you a new, manageable repayment plan for all of your debts, including your student loans, for three or five years. This reorganization might give you some much-needed breathing room if you’re overwhelmed with debt and calls from debt collectors. After this time period, many of your debts (and possibly your student loans) will be canceled.

If Chapter 13 bankruptcy does not result in student loan discharge, however, you’ll have to pay them back after your plan comes to an end. Interest that accrued during the repayment period will also be added to the loan balance, increasing the total amount owed. And keep in mind that filing for Chapter 13 can have a negative impact on your credit that can linger for seven years.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

FAQ

Can chapter 13 bankruptcy help with student loan payments?

Yes, Chapter 13 bankruptcy can reduce your student loan payments for three to five years. The automatic stay issued when you file for Chapter 13 also halts all collection activities, including those for student loans, which can prevent default and other aggressive collection actions during the repayment period.

Filing for Chapter 13 bankruptcy also allows you to file an adversary proceeding. If you’re able to prove that repaying your student loans will result in undue hardship, you may be able to get the loans canceled, along with your other debts, at the end of the repayment period.

Will chapter 13 bankruptcy eliminate my student loan debt?

Not necessarily. Filing for Chapter 13 bankruptcy can get certain debts discharged after you complete a three- or five-year payment plan. In order to get student loans discharged, you need to file a separate action, known as an “adversary proceeding,” requesting the bankruptcy court find that repayment would impose undue hardship on you and your dependents.

What happens to student loan collections during bankruptcy?

If you file for bankruptcy, all collection activities, including those for student loans, will automatically be paused until the case is over or a judge says that payments should restart.

Photo credit: iStock/Maksym Belchenko

SoFi Student Loan Refinance
SoFi Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org). SoFi Student Loan Refinance Loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Public Service Loan Forgiveness, Income-Based Repayment, Income-Contingent Repayment, PAYE or SAVE. Additional terms and conditions apply. Lowest rates reserved for the most creditworthy borrowers. For additional product-specific legal and licensing information, see SoFi.com/legal.

If you’re delinquent on your student loans, you may experience garnishment if your student loan debt is with a state or federal government or part of a federally insured student loan program. (Garnishment means withholding a tax refund by automatically sending it to your loan servicer to repay a defaulted loan.) Private creditors may also collect your tax refund to repay your student loan debt.

Obviously, garnishment is a difficult situation. Read on to learn more about your alternatives if you are potentially dealing with this scenario.

Can Student Loans Garnish My Tax Refund?

If your loans came from a state or federal student loan program, the federal government may garnish up to 100% of your tax refund if you’re in default repaying your loans. Default is defined as the failure to repay a student loan according to the terms of your promissory note.

You’re considered to be in default if you haven’t made a payment in more than 270 days. You may also experience legal consequences and will lose eligibility for more federal student aid.

However, it’s worth noting that if you are just 90 days or more behind on your payments, you are still considered to be delinquent in your payments. The three major credit bureaus (Equifax®, Experian®, TransUnion®) will likely be alerted. This information may possibly lower your credit score.

Also, only federal loans in default can result in tax refund garnishment, not private student loans, though your servicer might take other steps to get the funds they are owed.

💡 Quick Tip: Enjoy no hidden fees and special member benefits when you refinance student loans with SoFi.

Options for Managing Student Loans

Fortunately, you may be able to avoid default and avoid worrying about the government garnishing your refund. You can head off tax refund garnishment using a few different methods.

It can be wise to talk with your student loan servicer about all your available options. They can help you identify the right repayment strategy for your unique situation. If you have private student loans, you can also talk to your provider to determine the right course of action.

That said, here are a few options to consider:

SAVE Plan

The Saving on a Valuable Education (SAVE) Plan, which replaced the Revised Pay As You Earn (REPAYE) Plan, offers a potential alternative to tax refund garnishment of federal student loans. The SAVE Plan is an income-driven payment plan that lowers your federal student loan payments, taking your income and family size into account to determine your monthly payment.

The plan determines your payment based on your discretionary income, or the difference between your adjusted gross income and 225% of the U.S. Department of Health and Human Services Poverty Guideline amount for your family size.

The SAVE Plan eliminates monthly interest for both subsidized and unsubsidized federal student loans if you make your full monthly payment due. The government covers your monthly interest, meaning your loan balance won’t grow due to accrued unpaid interest.

Under the original SAVE Plan, if you initially borrowed $12,000 or less, after as few as 10 years, your loans would be forgiven (meaning you wouldn’t have to continue to repay your loans after you satisfy all the requirements and guidelines of the plan).

However, it’s important to note that two U.S. district judges (one in Kansas, the other in Missouri) recently placed an injunction on the next phase of the SAVE program and blocked it from providing additional loan forgiveness. The next phase of the SAVE program was scheduled to take effect on July 1, 2024. This is a still evolving situation as of this article’s publication date and one to monitor carefully.

Recommended: Can Student Loans Be Discharged?

Offer in Compromise

You can also take a different tack and work directly with the IRS (Internal Revenue Service) to avoid wage garnishment instead of approaching your student loan servicer. An Offer in Compromise (OIC) may also help your situation.

In an OIC, you pay the IRS less than your total tax debt if you owe the IRS more back taxes than you can afford to repay. If the IRS accepts your OIC, you must meet all the terms of your offer agreement — the IRS will only release your federal tax liens and levies once you fulfill those obligations.

You can fill out the OIC prequalifier tool to learn about your eligibility for an OIC.

Federal Student Loan On-Ramp

Most federal student loan borrowers began federal student loan repayment in October 2023 after the payment pause ended.

To ease borrowers into repayment, the Department of Education created an “on-ramp” period through Sept. 30, 2024, which prevents borrowers from suffering the worst consequences of missed, late, or partial payments, such as:

•   Being considered delinquent (meaning your loan payments are 90 days or more late)

•   Reports of delinquency to credit scoring companies

•   Loans going into default

Note that interest will still accrue, and not making payments means you’ll owe more money on your student loans over time. Your loan servicer may eventually have to increase your monthly payment to ensure you pay your loans off on time.

Also be aware that you can only qualify for the on-ramp if your loans were eligible for the payment pause. You don’t have to do anything to enroll in the on-ramp period.

The Takeaway

If you are not up to date on repaying your student loans, you could be in a situation in which your loan servicer can garnish, or directly take, a tax refund that was heading your way. If this could happen to you, it may be time to consider other options, such as the SAVE Plan, an “offer in compromise” with the IRS, the federal student loan on-ramp option, or another alternative. Talking to your loan servicer can be a smart move, whether you have federal or private loans.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

FAQ

Will student loans affect my tax refund?

If you continue to repay your federal student loans on time and in full, you won’t suffer any consequences to your tax refund. It’s only when your federal loans go into default (meaning they are 270 days or more late in terms of payment) that the government may garnish your tax refund to satisfy student loan debt repayment.

Can my spouse’s tax refund be garnished for my student loans?

A refund from a joint tax return with your spouse may be subject to tax refund garnishment, even though your spouse isn’t liable for your loan default. Your spouse may qualify to reclaim their portion of the refund by filing IRS Form 8379. Check with your tax preparer or search online for more information and details.

What happens if my student loans are in default?

Your federal student loans are considered in default if you don’t make your scheduled payments for at least 270 days. “Default” for private loans may be longer or shorter than the 270 days — ask your service provider for details. The consequences of defaulting on federal loans can include the entire unpaid loan balance and interest becoming due in a process called “acceleration,” lost eligibility for more federal student aid, no eligibility for deferment or forbearance, and lost ability to choose a repayment plan. Your credit score could be negatively impacted, and your wages or tax refund could be garnished.

Photo credit: iStock/MTStock Studio

SoFi Student Loan Refinance
SoFi Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org). SoFi Student Loan Refinance Loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Public Service Loan Forgiveness, Income-Based Repayment, Income-Contingent Repayment, PAYE or SAVE. Additional terms and conditions apply. Lowest rates reserved for the most creditworthy borrowers. For additional product-specific legal and licensing information, see SoFi.com/legal.

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