Are you feeling overwhelmed by student loans?
Watch our video on student loans 101
Rooted Planning Group
Financial Friday - Student Loan Edition by Financial Planner Becky Partridge
Take out federal student loans before taking out private loans. Federal student loans usually offer lower fixed interest rates, less interest accrues on subsidized loans while you are in school, they offer the ability to access income-driven repayment options and depending on your career and type of repayment option you could also be eligible for Public Service Loan Forgiveness. Fed Loans also generally have a disability clause.
If you have student loans or expect to, create a spreadsheet to track these loans. It’s likely that every semester you will be taking out loans and it can be very easy to forget how many you took out, especially when they are through different loan providers. Things to include in your spreadsheet would be: what type of loan was taken out, who the loan provider is along with their contact information, when the loan was taken out, the amount the loan is for, what the grace period is, and what the interest rate is.
When your student loans go into repayment get setup with automatic payments. Many loan providers will offer you a lower interest rate for doing this. It will also help ensure you don’t miss a payment, which will have a positive effect on your credit score.
Most student loans have a grace period of about 6 months after you finish college. While you are in the grace period you aren’t required to make payments on those loans. Do your best to watch your spending during that time and remember that after the 6 months is up you will have a student loan payment to make. If you are in the habit of saving the amount of money each month that your student loans will be it will make the payments seem more manageable once you have to pay them.
Are you thinking about a career in a public service field? If you are, be sure to check out Public Service Loan Forgiveness. Depending on the types of loans you have and what type of organization you plan on working for you may be eligible for Public Service Loan Forgiveness (PSLF). If you are eligible, be sure to set up your loan repayments with an eligible repayment plan.
Student loan providers will often times offer you a higher loan than what you need. Only accept the amount that you really need. This will lower the amount of interest that accrues while you’re in school and will lower your monthly payments after college.