President Joe Biden confirmed Wednesday what many have anticipated for months – a plan to forgive or reduce student loan debt for millions of debt-saddled borrowers.

If you earn less than $125,000 annually, he said, you're eligible to receive cancellation of up to $10,000 in federal student loans. If you received a Pell Grant, you can get up to $20,000 forgiven. If you're not eligible for any student debt forgiveness, your pause on repayments continues to be paused until year end. The Department of Education is also working on a proposal introducing a new repayment plan to ease the burden on borrowers.

Since the start of the pandemic in 2020, borrowers haven't had to pay a cent on their federal student loans. During this time, the pressure grew for the president to cancel the debt. It was one of the platforms Biden ran on for president in 2020. 

Though the plan was welcomed by many, it still garnered criticism. Many had sought higher forgiveness amounts – $50,000 or even all amounts, no matter how large. The total outstanding balance for federally owned (including defaulted) student loans in December 2021 was $1.38 trillion, the New York Federal Reserve said in April.