Buffalo, N.Y. (WBEN) - As the calendar flips to October, mailboxes across America and here in Western New York are filled with reminders that student loan repayments are resuming, after a period of pause and then confusion over the possibility of repayment being forgiven.
With repayment reality settling in, there are some economic minds concerned the resumption of payments will mean less spendable income and, perhaps, a negative impact on the overall economy.
WBEN reached out to a regular economic contributor who says he's not overly concerned about any broad negative economic reverberations.
Mark Hamrick of Bankrate.com tells WBEN this is not a huge issue for the broader economy. "Most of the estimates that have been done in terms of the needle being moved on, let's say growth, or consumer spending really indicates that it's somewhere right of the decimal point when we're talking about GDP, meaning, more of a hundredths of a percent or tenths of a percent impact, rather than something that would be truly significant for the broader economy," explains Hamrick.
Hamrick does admit the return of student loan payments can delay financial decisions like marriage, buying a home, having children, or purchasing a car. "I think the good news here is that for those individuals that got their degrees and are paying their student loan debt back, they have every reason to be optimistic that they should have an economically productive outlook," believes Hamrick.
Hamrick isn't buying retailers' theories the restart of student loan payments will lead to less spendable income. He says retailers are pretty adept at carving up excuses for sales projections that failed to materialize. Hamrick believes there are bigger fish to fry. "We still have high inflation, we've had another uptick in oil and gasoline prices, we have the highest interest rates that we've seen now, in many years. And we have less disposable income," says Hamrick. He says on the margin, this could be a bit of a challenge for an apparel maker or a bar or restaurant. "This isn't something that is so seismic, that the economy is going to have to struggle," says Hamrick.
Hamrick notes the average student loan payment is $200-$300 per month, but have been making new car loan payments that are approaching $1,000 a month.