On April 17, the Biden administration released a new student loan forgiveness proposal that could wipe out debt for millions of borrowers. Many borrowers hesitate to get their hopes up, especially since the Supreme Court struck down Biden’s 2022 plan to cancel up to $20,000 of student loans per borrower.

Both in the 2022 and 2024 proposals, there’s one group that’s constantly excluded from wide-scale forgiveness plans: Parent PLUS loan borrowers.

Parent PLUS loans are loans taken out by parents to support their children’s education. Unlike Direct loans given to students, Parent PLUS loans are ineligible for income-driven repayment plans, which excludes them from student loan forgiveness programs. Parent PLUS loans also have higher interest rates. This means that their student loan balances balloon at a much faster rate than loans given to students.

For BIPOC parents specifically, owing Parent PLUS loans widen the racial wealth gap. In the 2019-2020 academic year, 25% of Black parents took out Parent PLUS loans for their children’s education compared to 12.6% of white borrowers. Additionally, The Century Foundation reported in 2022 that 68 institutions across the US had less than 10% of parents making progress on their Parent PLUS loans. Fifty-nine of those 68 institutions are historically Black colleges and Universities.

If a Parent PLUS borrower defaults on their loan during retirement, their Social Security benefits are garnished to cover the cost of their monthly payment. This punishment prevents seniors from retiring comfortably.

Parent PLUS loans are preventing BIPOC elders from retiring

In Raleigh, North Carolina, 54-year-old Wanda S. took out $85,000 worth of Parent PLUS loans for her son to attend the Art Institutes, a system of art schools that closed in 2023 due to fraudulent admissions practices.

“I think I was taken advantage of,” says Wanda, who asked her last name be redacted for her privacy. Wanda tells Reckon that the Art Institutes didn’t offer her the option of letting her son take on student loans under his own name. “I thought they were being upfront and honest with me. I would have never done that had I known what would really happen.”

Combined with $6,000 of student debt from business school that she borrowed in 1988, Wanda’s Parent PLUS loan balance has since ballooned to $151,258.

Wanda wants to retire in 14 years, at the age of 68. “I want to get a house. I’m getting older, so I need to settle down and get out of my apartment and try to enjoy the rest of my days. I can’t buy a house at this point now.”

Parent PLUS loans keep immigrant families from building wealth

In Lawrence, Kansas, Sara C., who asked for her last name to be redacted to protect her family from Islamophobia in a small town, worries that her 64-year-old father will never stop working to repay his Parent PLUS loans.

“My dad, being a Pakistani immigrant who moved here in 1985, he’s worked pretty much all of my life, six to seven days a week,” says Sara.

Sara decided to attend the University of Kansas from 2011 to 2015 after a visit specifically for multicultural students from underrepresented backgrounds. When it came time to discuss finances, Sara and her father felt like there was very little support. “Yes, he is fluent in English and understands finances and stuff. But when you’re entering into situations like this, it can be hard.”

Nine years after graduating, Sara owes $30,000 in student loans, while her dad owes $170,000 in Parent PLUS loans for his three daughters, who attended college within the same decade. Sara says, “I feel tremendous guilt… because he’s already done so much and sacrificed so much of his life simply to provide me with a decent one.”

Parent PLUS loans prioritize profit over people by design

Winston Beekman-Breen, legal director at the Student Borrower Protection Center, says that student loan policymakers make incorrect assumptions of Parent PLUS borrowers. “They assume things like, Parent PLUS borrowers are taking out this loan when they’re at the peak of their career or earning potential. They know what they can afford and they make this loan decision clear-eyed.”

While student borrowers can get 20- or 25-year income-driven repayment plans, Breekman-Breen says, “[Policymakers] don’t want to give that to a Parent PLUS borrower because they’re likely to retire within that timeframe. They want to be able to have a higher rate of repayment and recoupment of the upfront costs from Parent PLUS loan borrowers.”

When education systems prioritize profit over people, borrowers bear the brunt of student loan policy flaws.

“Having to pay these loans in the middle to end of your career is preventing people from saving for retirement,” says Beekman-Breen. “The fact that they’re being forced to contribute a significant portion of their income in their fifties and sixties to these loans means they’re going to put off retirement.”

Here’s what you can do to advocate for Parent PLUS borrowers

Borrowers and allies can leave comments on the Biden administration’s latest student loan forgiveness proposal until May 17. Brekman-Breen encourages borrowers to share their personal stories in their comments. Here’s a template you can use:

For Parent PLUS borrowers:

My name is _____. I’m (insert age) years old and I live in (insert city and state). I have (insert student loan balance here) worth of student loans. I want to retire in ____ years, but I can’t do that because of my Parent PLUS loans.

[Insert 1-5 sentences about your Parent PLUS loan story here. List the economic opportunities that your Parent PLUS loans have taken away from you.]

Right now, Parent PLUS loans are not eligible for income-driven repayment plans, which makes it hard for me to complete my monthly payments. This is deeply unfair, and I’m afraid I won’t be able to retire if things don’t change.

I urge the Biden administration to include Parent PLUS loans in this new student loan forgiveness proposal. It would make a huge difference in my life and the lives of thousands of others who struggle with the same loans.

Thank you,

(your name here)

For children whose parents took out Parent PLUS loans:

My name is _____. In (insert years that you went to school here), my parents borrowed (insert Parent PLUS loan balance here) for my education. Now, years later, I’m afraid my parents can’t retire because Parent PLUS loans are not eligible for student loan forgiveness plans.

[insert 1-5 sentences about your Parent PLUS loan story here. List the economic opportunities that Parent PLUS loans have taken away from you and your parents.]

Right now, Parent PLUS loans are not eligible for income-driven repayment plans, which makes it hard for my parents to complete my monthly payments. This is deeply unfair, and I’m afraid they won’t be able to retire if things don’t change.

I urge the Biden Administration to include Parent PLUS loans in this new student loan forgiveness proposal. It would make a huge difference in my life and the lives of thousands of others who struggle with the same loans.

Thank you,

(your name here)

Leave your comments on the proposal using the Federal Register by May 17.

Leo Aquino (he/they) is an award-winning independent journalist covering anti-capitalist personal finance at Queer & Trans Wealth. Leo is also a trauma-informed financial coach and educator who provides affordable services for queer, trans, and BIPOC communities.