Student Loans: How to Keep Post-Graduation Debt from Ruining Your Financial Future
It’s no secret that the cost of college is astronomical, and prices are only rising. A few of the lucky ones can escape college without getting into debt, however, most students can’t continue their education without the aid of student loans. The burden of student loan debt can be overwhelming for students who are getting ready to graduate—it seems impossible to ever pay off a huge mound of student loans, especially while trying to find a job after graduation. Although handling student loans is less than pleasant, you don’t have to choose between an education and a bright financial future. If you’re dealing with these types of loans, read on to learn how handling your student debt properly can help you avoid a rough financial future.
Start to Pay Right Away
As you’re looking into the future, you might see that paying off your student loan debt could take decades. Starting to pay off the loans right away is a smart way to keep them from spilling over into too many of your tomorrows. In fact, you can usually start to pay off the debt before you finish college as long as the loan provider does not have any penalties for or stipulations against doing so. This method is a smart one for saving some money on interest. Even if you are tight on money (as most recent college grads are), paying a little from each paycheck will help you to slowly chip away at the mound—every penny counts.
Consolidate Your Student Loans
No matter how much of your education was funded by loans, a good chance exists that your loans can from a variety of different sources. Making multiple payments each month does not only increase the chance that you will forget to make one, but it also strongly suggests that you’ll be paying more money in interest each month. When you consolidate your student loans, you will have one monthly payment that will likely be more affordable than if you were making separate payments.
Review the Different Payment Options
Instead of continuing to push your loan off, review the different payment options. Some of them suggests payments based on your current income, and others are simply a standard repayment plan. You generally have the ability to go into your account and change your plan at a later date if your financial situation changes. You can also often choose a graduated repayment plan. This means that as your income grows over the years, so will the amount you are paying per month.
See If You Qualify for Loan Forgiveness Programs
Do not just automatically assume that a loan forgiveness program is out of your reach. It is true that loan providers have fairly strict requirements for forgiveness, and you cannot receive it just because you are unhappy with your current job. Visit the website of your service provider, and you will likely be able to take a quiz to see if you qualify for either full or partial loan forgiveness. If you aren’t sure, it doesn’t hurt to ask a financial advisor at your service provider, just so you can be fully aware of your options.
Handling student loan debt may seem jarring and overwhelming when you first graduate, but learning how to manage it can make all the difference. Most people assume that all student loan debt is unmanageable, so nobody looks for helpful alternatives. Once you create a plan for paying off your loans, you’ll see that it is in fact manageable, and can be done within a reasonable amount of time. Don’t assume that your student loan debt will be hanging over your head for years to come—be proactive and start preparing for a healthy financial future!