President Donald Trump signed the One Big Beautiful Bill Act on July 4, reducing funding for a slew of social safety net programs, extending tax cuts from his first term and boosting national defense spending.
Among the cuts, the biggest were to Medicaid and the Supplemental Nutrition Assistance Program, with over $1 trillion slashed across both programs, according to Congressional Budget Office estimates. In addition, the act eliminated graduate student loan programs and placed loan caps. These are some of the ways the One Big Beautiful Bill Act will impact students:
SNAP cuts to students
The One Big Beautiful Bill Act will slash SNAP funding by $186 billion over the next decade, according to estimates from the CBO. This is one of the biggest cuts to social safety net programs in the act.
Beth Corbett, vice president of government affairs and advocacy for the Central Texas Food Bank, wrote in an email that the SNAP cuts could deter prospective students from pursuing higher education.
“The potential impacts of these new eligibility requirements could have a significant impact in rural communities in particular, where access to jobs may be limited, and there are fewer options for enrollment in higher education and vocational training,” Corbett wrote. “There is a significant possibility that fewer people will choose to pursue an advanced degree, opting instead to satisfy SNAP work requirements through career paths not requiring secondary education.”
Steven Pedigo, director of the Lyndon B. Johnson Urban Lab, an institution that addresses issues affecting urban communities, said students who work part-time or have additional financial burdens may need to take up additional responsibilities due to the cuts to food stamps. Similar to White, Pedigo is also concerned about the SNAP cuts largely impacting lower-income students the most.
“Lower-income students are always having to, a lot of times, self-finance or self-generate the funds to go to college,” Pedigo said. “There’s always an opportunity when you have these types of cuts that some of our most vulnerable students and residents in our communities feel the punch of this.”
A concern Corbett, White and Pedigo share about the SNAP cuts’ impacts on education comes from states’ reactions. They worry that if states have to fill in the gaps in SNAP left by the bill, states will cut funding from other programs, including funding for universities.
However, the exact and long-term impacts on students from the One Big Beautiful Bill Act are yet to be seen, as many of the bill’s cuts will not take effect until months and in some cases, years later.
“The long-term implications of these changes to SNAP eligibility are still unclear,” Corbett wrote. “Increasing the reliance on the charitable food network is not a sustainable solution to addressing food insecurity.”
Grad PLUS eliminated, loan caps set
Direct plus loans for graduate students, commonly referred to as grad PLUS loans, are given to students pursuing post-graduate degrees to cover their full cost of attendance, minus any financial aid.
However, the reconciliation bill will eliminate the grad PLUS loan program starting July 2026, with borrowers being able to apply until June 2026. They will receive the aid until the 2028-2029 school year.
Rachel White, an associate professor in the department of educational leadership and policy, said this bill will greatly impact middle to lower-income students who may not have the means to otherwise afford tuition.
“To me, that is counterintuitive to whether or not we want to subscribe to this ‘American Dream,’” White said. “We do have systems in place that will help students, regardless of what their background is, to achieve and pursue these types of positions.”
In addition to the elimination of grad PLUS, the bill also caps federal loans for master’s degrees, including $20,500 a year and a $100,000 total cap per student, which was reduced from the previous $138,500 total cap.
White said these changes can pressure students to use private loans to cover their cost of tuition if they plan to pursue a postgraduate degree, which could be more challenging for them to receive.
“Those (loans) come at higher interest rates oftentimes,” White said. “They also require an application review that potentially could lead to some students not being able to get those loans and particularly at a time when we are in need of medical professionals.”
The bill also caps undergraduate loans from parents through the Parent PLUS program. Previously, parents could borrow up to the cost of tuition for their child. Now, there is an annual limit of $20,000 and a total limit of $65,000 per child.
The act also consolidates many of the loan repayment plans into just two that borrowers can choose from. These are the Standard Repayment Plan, which is paid off in 10 to 25 years with fixed payments, and the Repayment Assistance Plan, which requires monthly payments based on the borrowers’ income and offers loan forgiveness after 30 years of payment.
“The thing about shifting some of these repayment plans is that people are really going to think about the investment that they’re making in higher education,” White said. “Really thinking long term, how much debt are they willing to incur to obtain a degree and how long will it take for them to pay them back.”
