How maternity leave can reduce your student loan payment

Maternity leave is often accompanied by a temporary drop in income. Some parents receive partial wages due to short-term disability or employer benefits. Others take unpaid leave under the Family and Medical Leave Act (FMLA), which guarantees job protection but not pay. At the same time, medical bills, childcare scheduling, and day-to-day expenses continue.

Student loan payments can feel especially rigid right now. Unlike rent or utilities, they do not automatically adjust when income decreases. But federal student loan rules allow borrowers to request changes that reflect short-term financial realities, including maternity leave.

Understanding these options before the furlough begins can help you avoid missed payments, protect credit scores, and free up cash during a critical period.

Procrastination and forbearance

Two of the most common tools for furloughed borrowers are forbearance and forbearance, but we don’t think they’re the best. Both offer borrowers the option to temporarily pause payments, usually for several months at a time. The main difference is the way interest is handled.

Delay is generally available when a borrower meets specific criteria, such as unemployment or economic hardship. Maternity leave, combined with a lower income or zero income, can qualify as an economic setback. During the deferral, interest will not accrue on subsidized federal loans, although it will continue to accrue on unsubsidized loans.

Tolerance is broader and often easier to obtain, especially if the income reduction does not meet formal deferment standards. Payments are suspended, but interest accrues on all types of loans. That interest can be added to the loan balance later, increasing the total amount repaid over time.

For borrowers with a short-term disability who are still receiving partial income, forbearance is often the more accessible option. For those on unpaid leave, deferment may be possible, depending on income and type of loan.

Both options can provide immediate breathing space, but neither reduces the underlying cost of the loan. They are best seen as temporary bridges, not long-term solutions.

Income-related repayment: use your lower income to your advantage

For borrowers on an income-driven repayment plan (IDR), maternity leave can provide a strategic opportunity. And this is our favorite approach.

IDR plans base monthly payments on household income and size. If income drops during the furlough (and your family size changes due to your newborn), borrowers can request to recertify their income early instead of waiting for the annual deadline.

That recalculation can significantly reduce monthly payments (sometimes to $0) while keeping the loan in good standing.

The reduced payment will remain in effect for up to twelve months, even after the borrower returns to work and income increases again. For families facing childcare or medical costs after furlough ends, that extended period of lower payments could be especially valuable.

This strategy is often financially more beneficial than postponement, because:

• Payments made under IDR will still count toward loan forgiveness timelines, if applicable.
• The lower payments last for 12 months, which gives you time to adjust your finances after having a new baby.

In short

Maternity leave doesn’t have to derail student loan repayments, but it does require proactive choices. Forbearance and forbearance can provide short-term relief, while income-driven repayment adjustments can provide longer-lasting benefits.

The best option depends on income during the furlough, the type of loan and how quickly expenses are expected to increase afterwards. Borrowers who plan ahead (and use federal repayment rules strategically) can protect their finances during one of life’s most important transitions.

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