firm focuses on high-debt clients— doctors, lawyers, dentists, veterinarians, corporate professionals and MBAs, to name a few.

Under old rules, borrowers could get their payments capped at what McGuire calls“ pretty darn low” levels, at 10 % or 20 % of discretionary income, depending on what program they were using and how it was calculated.“ Now they don’ t have access to those cheaper plans at all, not even a 20 % income-driven plan. If they have a $ 150,000 balance, which is not unheard of for some of these programs— amortize that over 10 years. That’ s a pretty high payment. So the impact is pretty big.”

Parents Face The Most Pain

While student borrowers retain access to some form of income-based repayment cap, the outlook is far more challenging for parents. Changes to Parent PLUS loans— the federal loans that parents take out to finance their children’ s education— limit borrowing and, more significantly, remove access to income-based repayment options for new loans issued after July 1.

“ Parents who are still borrowing after July won’ t be able to make payments based on a portion of their income,” McGuire says. Meanwhile, she notes, new rules also restrict access to Public Service Loan Forgiveness for certain parent borrowers.( As its name suggests, this program is for students who spend a certain amount of time in public service jobs.)

New borrowers now will primarily be limited to the new repayment plan( called the Tiered Standard Plan) that has longer repayment terms. This shift could fundamentally change how families approach college financing.

Betsy Mayotte, president of the Institute of Student Loan Advisors in Plymouth,

Mass., says she is already seeing the consequences play out.“ I’ m particularly worried about parent borrowers,” she says. The new changes“ essentially took away any lower payment opportunities that Parent PLUS borrowers might have.”

In one example, Mayotte describes a family with $ 130,000 in Parent PLUS debt and a $ 100,000 household income facing monthly payments of $ 800 to $ 900 for decades— an amount she says is unlikely to be sustainable, especially when those parents enter retirement.

A Narrowing Path Amid Higher Stakes

The changes are arriving at a time when broader college affordability pressures are already mounting.

Federal grant aid has failed to keep pace with rising tuition costs, increasing the gap families must cover through savings, income, and borrowing, sources say. At

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MAY / JUNE 2026 | FINANCIAL ADVISOR MAGAZINE | 31