After three years of relief, student loan borrowers received a double dose of bad news in June. First, the debt ceiling deal ended the student loan repayment moratorium once and for all, after several extensions. Beginning in late August, all federal student loans will go into active repayment status again, for the first time since before the COVID pandemic.

Then, in late June, the Supreme Court officially struck down President Biden’s proposed student loan forgiveness plan, which would have erased up to $20,000 of debt for qualified borrowers. The court ruled that such an order could not be authorized unilaterally without congressional approval. While a replacement plan is already in the works, it is likely to be much less generous. For borrowers who have gotten used to fatter bank balances, there will likely be some required reductions in discretionary spending as autumn arrives. The net impact of that reduced spending is to be determined, but it should weigh at least somewhat on economic growth as we head into the colder months.