How the Dismantling of the Department of Education Impacts Students and Parents
For the nearly 10 million students and families who rely on federal student aid to help pay for college, it’s understandable to feel uncertain about what comes next. On March 20, 2025, President Donald J. Trump signed an Executive Order calling for the dismantling of the U.S. Department of Education (ED), which currently manages around $1.7 trillion in federal student loans.
These changes will reshape the way students apply for financial aid, access loan forgiveness programs, and manage repayment. For many families, this raises serious questions about how they’ll fund higher education in the years ahead.
The Department of Education has long provided a consistent process for students to connect with grants, loans, and work-study programs. But with layoffs already reducing the department’s workforce by nearly 50%, student lending may shift from the federal government to private lenders. This introduces new loan options but also includes stricter credit requirements. Students without strong credit or a cosigner may face additional challenges qualifying for loans.
There’s also concern about what happens to key federal programs like Public Service Loan Forgiveness (PSLF) and the SAVE plan, both of which help borrowers manage their debt. There is speculation that these programs could be scaled back or eliminated altogether, leaving families with fewer protections and limited paths to forgiveness.
Given the uncertainty around federal aid, it’s important to understand what other resources are available. Ascent, an award-winning student success company and proud College Confidential partner, offers private student loans and scholarship giveaways to help students pay for college.
While it’s too early to know exactly how these changes will play out, families should start reviewing their financial aid plans, fill out the FAFSA as soon as possible and start exploring all available options—including private loans, scholarships, and work-study programs.
A recent article from Ascent’s Co-Founder and CEO, Ken Ruggiero, offers these tips to help students and families prepare for the impending policy changes.
Steps to Prepare for Policy Changes:
- Organize financial aid records: Keep track of award letters and loan statements.
- Review loan details: Understand interest rates, repayment terms, and balances.
- Monitor interest rates: Learn how rate changes impact monthly payments.
- Stay informed: Follow trusted sources for updates on student loan policies.
- Remain calm: Policy changes will be phased in gradually, allowing time to adjust.
- Explore funding alternatives: Consider private loans, scholarships, grants, and work-study options.
Read the full article from Ascent’s CEO for more details on these changes and how you can prepare.