• Billy Hatton, CFP®

Little-Known Challenges for Transgender Student Borrowers


You think biting this pencil in half is tough? Try dealing with your student loan providers as a transgender person.

One issue close to my heart is how horribly, God-awful expensive, emotionally, and financially, it is to be transgender in America. Adding more weight to that already heavy burden is an aspect I honestly had not considered until recently -- student loan hurdles for transgender folks. Asia Martin from Forbes recently wrote a fantastic article entitled, "Student Loans Are Even More Complicated For Transgender Borrowers. Here's Help." I encourage you to read the full piece, but I wanted to call out a few of the more shocking points she makes, and a few tips if you find yourself in the same position. Let's start with a hypothetical scenario. Like, say you have graduated, congratulations! You then complete your transition and officially become the gender you are. Fantastic! But then, with your court-ordered name change in hand, how do you get your loans in your new name? Your first thought may be to do the most straightforward thing first, log onto your mystudentloans.gov account and just change your name. They deal with your aid directly after all, right? Well, that will open up a whole can of worms because now your social security number (SSN), which is still tied to your birth name, is seemingly being used by someone else. And since every agency you will need to deal with uses your SSN, the FIRST thing to do is to contact the Social Security Administration (SSA). After that, you'll need to follow up with, at minimum, three more organizations. Namely, the Federal Student Aid center (the federal agency responsible for the FAFSA and overall overseer of federal financial aid), the individual student loan providers for each servicing company, and finally the university itself. If you have any scholarships, I would highly recommend checking in with them before speaking to your university. Frankly, to have to go through all these hoops just to be treated like anyone else is just plain wrong. Add the fact that you don't know if you'll be treated kindly by any of the people you're forced to interact with, and the whole experience sounds like an exercise in being "other-ed." Personally, it gives me anxiety just thinking of having to deal with all that. If you thought it was difficult to understand how to make sure your student loan and financial aid are correctly distributed, if you are transgender, wait until you see the when! That's right, the timing of when you reach out to all those agencies makes a difference too! Let's say you transition while in school and go to reapply for financial aid. There's a possibility your FAFSA will be denied since there is now conflicting gender information. To avoid this scenario, one aid recipient waited to submit their name change until his last semester, after he received all his aid. That way, they were able to have their loans and degree under his new name. But when they reapplied for another degree though, new problems and stresses emerged. Despite doing everything right, it didn't stop the other agencies from making mistakes. Since this is a stupidly complicated situation, errors will inevitably happen on both sides. But wait, there's more! You didn't think it would be that easy, did you?


Once you have gone through all the above hurdles, there is one more to watch out for, "The Selective Service Trap." For me, signing up for Selective Service was just something I had to do after receiving a scary-looking red envelope from the government. But for transgender men, it can be a barrier to receiving financial aid. The Selective Service System (SSS) requires that all men before they turn 18 registers for the possibility of a wartime draft (God forbid). The problem is that SSS determines draft eligibility based on your birth sex. This creates an obstacle, to put it lightly, for transgender men since the FAFSA requires all males to register or else the FSA will withhold federal aid. If a transgender man puts 'male' on the FAFSA application, it will spring the trap by holding back assistance until a Status Exemption Letter is completed, requiring you reveal your status to the Selective Service System. Unfortunately, each university has different rules regarding accepting the exemption letters. A new letter may need to be filed each year you apply for aid through the FAFSA. Essentially, if you want to apply for federal aid, you are either forced to complete the paperwork as your birth-sex (which could feel dehumanizing) or go through a gamut of bureaucracy, strangers, and stress to apply for financial assistance as your actual gender (which could also feel dehumanizing). Now, this whole article is depressing. Honestly, the more I learned about this problem, the angrier I got. But I don't want it to seem like everything is doom and gloom. The fact that there are people aware of this situation and actively taking steps to help transgender folks is amazing!

Furthermore, while the process is long and convoluted, there is help! The National Center of Transgender Equality has a list of each state's legal resources. These sources can help on a variety of transgender-specific legal issues, from applying for a court-ordered name change to help to deal with the SSA, FSA, or other student loan providers.


When it comes to finances, I believe that many people feel like not having it all together makes them a 'bad person.' As if they're neglecting something they should already know how to do. But with the amount of complexity for this one issue for transgender folks, I feel it highlights how stupidly hard it can be to get finances in order. So, I hope that, because there are more resources and discussion regarding finances for transgender folks, it normalizes the fact that this shit is hard. It's ok to struggle, but know there are people out there that will help you.