The U.S. Education Department has announced that student loan collections will pause on January 31, 2022. So if you were taking a break, graduated recently, or have already begun making repayments, these student loan tips will help you.
We understand that everyone’s student loan situation is quite different. But specific tried-and-tested strategies can help you pay off your student debts. So with that said, let’s begin.
- Re-Evaluate Your Student Loan Terms (Know Your Loan)
One of the first things to do is get your student loan payments organized. It’s essential to monitor the details of your student debts, from your interest rates to how much you borrowed.
Of course, maybe you vaguely remember what you signed up for. But some people have had the debt for decades now and have forgotten the exact details. So it’s essential to recheck the numbers given the current financial situation.
Knowing more about your student loans will get you well informed if you’re pretty new at student loan repayments. You can then estimate the monthly payments with a student loan payment calculator and see how much you’ll be charged. But, of course, the same strategy also applies to interest costs.
This information will help you decide whether to opt for a student loan forgiveness, refinance, or consolidate to get a lower interest rate.
- Know Your Student Loan Servicers
You must get to know your loan servicers because you don’t want them to catch you unawares. First, find out the type of student loans you have and the company servicing them. Also, ensure that the information about your student debt is updated.
If you have federal student loans, sign in to your Federal Student Aid account and know loan services that have your account.
That said, if it’s private student loans, contact your loan lender. If you’re not sure, check your credit report through AnnualCreditReport.com. Your details should be there.
Lastly, make sure to stay in touch with your student loan servicer. If you change any information such as email address or move to a new location, update this information with them. It’s important. After all, you could miss a payment and never know because you never received any notification.
- Review Loan Forgiveness Options When Pursuing Jobs
When you start your job hunt, review student loan forgiveness plans to know if they’re available in your field.
For example, the Public Service Loan Forgiveness program can pay off your student debt after ten years. But you have to work in a government agency, a non-profit, or other qualifying workplaces.
Professions such as doctors, teachers, and lawyers can also qualify for repayment assistance or student loan forgiveness. In addition, you can also search for jobs that offer student loan payments as part of their employee benefits package.
- Don’t Stop Living Like A Student.
There’s a high tendency to spend more money after you graduate. We understand how you probably need new clothes for interviews and furniture for your new place. It can be tempting, but try your best to avoid too much spending right after graduating.
So it’s advisable to live like you’re a college student, even if you get a great job right after college. That will help you direct all the extra income towards your student loans. So do that, and your future self will thank you.
However, try to avoid the temptation of living expensively even when your income increases. You can pay back your student loans quicker when you stick to your budget.
- Understand Your Student Loan Repayment Options
One of the critical processes is researching and understanding your student loan repayment options. For example, if you have federal student loans, you can access income-driven repayment plans, the standard 10-year plan, extended loan repayment, etc.
These repayments are flexible, which can help you if your income is limited and you need to reduce the monthly payments. Remember that the student repayment you opt for doesn’t have to be the plan for the entire duration of the student loan.
You can change the repayment plan as your financial situation changes. Private student loans, on the other hand, have less flexibility. But some lenders do offer forbearance and deferment if you run into financial hardship.
No matter what you do with your student loans, don’t default on them. If you’re struggling to make payments, we recommend contacting your servicer immediately. You might be able to pause payments temporarily. That way, you won’t default on your student loans.
If you don’t know what to do, we recommend talking to a student loan expert. They will help you make an informed decision based on your current situation.