A Letter from Luke

August 26th, 2022

Greetings Friends,

For years, friends of The Go Fund have asked me: “What will happen to The Go Fund if student debt is forgiven by the government?” Here was the two-part answer that I shared back then:

  1. Though we believe it is highly unlikely that the federal government unilaterally forgives 100% of student debt, there is a possibility that they forgive some student debt at a future date.

  2. We will work diligently to ensure that no single federal legislative decision will cause the mission of The Go Fund to become irrelevant overnight.

If you haven’t heard already, President Joe Biden announced on Wednesday, August 24, 2022, that he would provide some student debt forgiveness for millions of borrowers. My purpose in writing this memo is not to editorialize or make political claims or judgments regarding this development; however, this development does have specific implications on The Go Fund. Therefore, my purpose is to inform you, as a supporter of The Go Fund, about how this new plan will impact our ability to move toward fulfillment of our mission to “Eliminate barriers to advance the gospel to the unreached.”

Summary of Biden’s Student Debt Forgiveness Plan

Here are the high-level provisions of Joe Biden’s three-part student debt forgiveness plan:

  1. The pause on interest for federally-held student loans will continue through December 31, 2022.

  2. Non-Pell Grant borrowers are eligible for up to $10,000 in debt cancellation, and Pell-Grant borrowers are eligible for up to $20,000, so long as loans were obtained before June 30, 2022 and adjusted gross income is less than $125,000 (individual) or less than $250,000 (household). 

  3. Revisions to income-driven repayment plans have been introduced. Most significantly,  a decrease in the percentage of discretionary income that needs to be paid toward student debt from 10% to 5%.

How The Student Debt Forgiveness Plan Impacts The Go Fund

Today, The Go Fund has 102 missionary partners, and we have committed to paying off roughly $5.3 million in student debt. Though we are still gathering information to determine which of our missionary partners are eligible for student debt forgiveness, here is our initial estimate regarding the impact of this program on our existing missionary partnerships:

Using these estimates as our benchmark, this means that right around $1,116,000, or 21% of the $5.3 million in student debt that The Go Fund has committed to paying off, would be forgiven for our missionary partners. Moving forward, here are the effects that this would have on The Go Fund:

  • Short-Term Impact (1-2 years): Very little effect. Because we pay student debt on a monthly basis (not lump sum payments), and because monthly payments will not change when there is a reduction in principal amount, our monthly commitment to each borrower will likely stay the same. For instance, if we pay $450 per month on a loan balance of $50,000 (a fairly typical scenario), and the loan balance is reduced to $40,000, we will still owe $450 per month.

  • Mid-Term Impact (3-5 years): The mid-term effect for us could be significant. Though we will still pay the same monthly amount for each borrower, we will ultimately pay off the total loan balance for each borrower faster. For instance, in the scenario above, we would pay off the loan about two years sooner ($10,000 forgiveness / ~ $5,000 in payments per year = two years less in payments). In effect, we could have 20-30 missionary partners for whom, in the next 3-5 years, we are able to pay their student loans off two years early. With the free cash flow generated, we would approve new missionary partners for loan repayment.

We estimate that we will be able to approve somewhere between 20-30 more missionaries for student debt repayment in the forward-looking 3-5 years that we would not have been able to approve otherwise, due to the free cash flow produced as a result of the new student debt forgiveness plan. This is excellent news!

New Program Launch

For years, I have suggested that we would work diligently to ensure that no single federal legislative decision will cause the mission of The Go Fund to become irrelevant. These were not just empty words. In early 2021, our Board of Directors tasked our leadership team to develop a proposal for a second program, to run parallel to the Student Debt Repayment Program (SDRP), while keeping a close eye on our mission. At that point in time, we had successfully developed our SDRP across seven years, and the highly systematized approach allowed us to increase efficiencies and create new capacity for the organization—a perfect time to add a new program.

Since early 2021, we have worked to develop the second program of The Go Fund, with the aim of addressing a second barrier. This new program exists to “increase the number of American Churchgoers who are aware of and actively participating in the Great Commission.” We will begin sharing more about this program later this year, targeting a full launch in early 2023. We fully anticipate that this new program, like our first program, will help us to more effectively eliminate barriers to advance the gospel to the unreached.

Further, a new mission-aligned program decreases the outside risk that any political decision causes our organization to lose relevance. By God’s grace, this latest political decision is one that will benefit The Go Fund, its missionary partners, and the thousands of unreached people who will receive the gospel sooner as a result. We indeed serve a creative God who can use even political leaders to advance His global cause!

Conclusion

Though the federal government can be highly unpredictable, our God is not. He has a plan to redeem representatives of every tribe, tongue, and nation to worship Him for eternity. By his remarkable grace, he has extended the sweet privilege to his followers to play a significant role in this story of redemption—the greatest story ever told, that is unfolding before our very eyes. Thank you for leaning in to play a part in God’s story, by linking arms with The Go Fund. We look forward to leveraging all of the resources that He entrusts to us—politics aside—for the advancement of his Kingdom, until He returns or takes us home.