The reality that you have to pay off student loans as soon as you start earning a decent amount of salary after graduating from college is a bitter one. It is easy to forget and dismiss the fact that you will be under a very heavy debt after you leave college, while you are still studying. The reality of the situation starts to hit when you start to pay off student loans with your own monthly salary and at that time it can all seem quite unfair that you have had to pay such a heavy price (literally!) to get a degree. However, knowing you have to meet this financial burden is made easier with these 7 Tips to Pay Off Student Loans.
1. Get Organized
The very first thing that you need to do when you start to pay off student loans is to sort things out and get organized so that everything becomes a lot clearer. When things are mapped out in a way that is easy to understand, the solution follows naturally and you find it easier to implement. It is entirely possible that you may not even be fully aware of how much you actually owe your lender because there are so many years between the time that you start paying off the loans and the time that you borrow them.
2. Make a List
• What kind of loans do you have?
• How much exactly do you owe?
• Who do you owe, that is, which lending company or companies?
The main things to keep in mind is that the bank where you took out your loan may no longer be your present creditor, so find out who exactly you owe. Also be sure that you know the difference between grant money and loans, because grant money is free money and you don’t ever have to pay that off.
3. Pay Back as Quickly as You Can
Don’t ever delay your student loan payments if you can help it. The more you pay off, the more money you save on interest (sometimes up to several thousand dollars) and the quicker you get rid of the loans. Usually it may be just in time for other important things that are about to become a big part of your life, like a mortgage. It’s a good goal to try and aim to pay off student loans within a period of ten years.
4. Paying in Time
It may not seem very important, but it certainly matters a lot that you pay your monthly amount for your loan on time. Failure to do so may result in a heavy fine being administered so that you end up paying more than you actually owe. It may also, in some circumstances, affect your credit rating. The easiest way to do this is by having your bank set up a direct debit. This way the payment will be deducted automatically from your account monthly and you won’t have anything to worry about.
5. Making a Budget
See what your monthly income is and where it all goes. If you can afford to pay off more than required to pay off your student loan, do so.
6. Keep up with the News
Sometimes rules governing student loans change and this might be a good thing for you so, stay in touch with what is going on. You may find out that your interest rates may have been reduced.
7. Know Your Options
It would also benefit you immensely to find out about the options you have for repayment so that you can find something that suits you. Options include consolidated loans, graduated payments, income based payments, standard payments and even paying off student loans in full. Another tip is to have your payments deferred if possible, in case you are facing trouble making them.
The fact is while it may seem so, student loans needn’t be the heartache they are made out to be. You just need to be sensible and prudent. The rest will follow in due course. Make life after college easier, by following these Tips to Pay Off Student Loans and that hard earned salary will be much more worth it.
Top Photo Credit: Student Loan Blog