Pay Up or Else: Trump Admin to Garnish Wages Over Student Loans

Starting next month, millions of Americans behind on their student loans could see their paychecks and tax refunds snatched by the federal government. The Education Department confirmed Monday it’s kicking off aggressive debt collection efforts—including wage garnishment—for borrowers in default.

Let’s be clear: this is happening at a time when people are already barely hanging on. Groceries cost more, rent is sky high, and wages haven’t kept up. Now, on top of all that, folks who couldn’t pay off student loans during a global pandemic are about to be punished even further.

“Oh, so jacking up grocery prices, crashing the stock market, threatening to slash Medicaid & SNAP, and slapping on ridiculous tariffs wasn’t enough?” said U.S. Rep. Jasmine Crockett (D-Texas). “Now Trump’s coming for your paycheck and your tax refund—just because you fell behind on student loans during a pandemic.”

Roughly 5.3 million borrowers are already in default, and another 4 million are dangerously close—over 90 days late. Under the new plan, the government will begin garnishing wages and withholding things like tax refunds and Social Security checks through the Treasury Department’s offset program starting May 5. All it takes is a 30-day notice.

“This decision is all about punishing student loan borrowers,” said Sen. Elizabeth Warren (D-Mass.). “Instead of lowering costs, Donald Trump wants to take money out of your grandma's Social Security check.”

Let that sink in—this isn’t just about young professionals. This could affect anyone who’s struggling, regardless of age.

The grace period that protected borrowers during the pandemic? That’s over. Payments resumed in late 2024 after being paused since March 2020. And thanks to court rulings, it’s been chaos for borrowers ever since.

U.S. Rep. Ro Khanna (D-Calif.) pointed out the economic risk.

“5.3M borrowers are in default on their federal student loans. Restarting loan payments now will cause credit scores to plummet and risk millions of Americans' ability to participate in the economy,” said Khanna. “It’s time we forgave student loans for working- and middle-class families.”

Even getting help has been tough. Federal Student Aid offices laid off staff, and repayment plan options have been glitchy or flat-out unavailable. Borrowers in Biden’s more affordable SAVE Plan were placed in forbearance earlier this year while the department scrambled to fix court-blocked repayment programs.

“Things are really difficult to understand right now,” said Kristin McGuire of Young Invincibles. “Things are changing every day. We can’t assume that people are in default because they don’t want to pay their loans. People are in default because they can’t pay their loans and because they don’t know how to pay their loans.”

And now, even that confusion could cost them their wages.

“This is crazy,” said U.S. Rep. Bennie G. Thompson (D-Miss.). “When scholarships and grants fall short, students turn to loans with the promise they can repay later. Now the Trump administration has ended the grace period option, choosing to garnish wages instead. Another brutal blow to the middle and working class.”

There are ways out—like loan rehabilitation—but they’re complex, only available once, and hard to access for many. Borrowers have to prove income and expenses, make nine straight on-time payments, and only then can they get out of default.

Meanwhile, the Biden administration canceled over $183 billion in student debt for more than 5 million borrowers, but broader relief was blocked by the courts.

Still, Trump’s Education Secretary Linda McMahon stood firm, saying: “American taxpayers will no longer be forced to serve as collateral for irresponsible student loan policies.”

This isn’t just a policy shift. This is seen by many as a gut punch to people doing their best to stay afloat.

Thanks for reading The Kicker! Let me know your thoughts below. Should the government be allowed to take your paycheck or Social Security if you can’t afford to paystudent loans?

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