You've gotten your degree, you're making money, and now it's time to give something back - your student loans.
Managing your loan payments can be a pain, but it's not as difficult as you might think. Start early, think far ahead and follow these basic steps: Ace your exit interview. Loans are probably the last thing you're worried about before you graduate, but if you've received federal loans, the exit interview is required by law. You'll go over your rights and responsibilities concerning your loans. But don't worry if you miss it - your school can mail you the materials and many participate in an online program. In this post we cover some tips to help you payback your student loans without going crazy in the process. Enjoy your grace period. Luckily, you usually don't have to start repaying your plans until a few months after graduation. The grace period varies from school to school, but you usually get six months after you're no longer enrolled (it doesn't matter if you graduate, quit, or just take some time off. Take this time to get your life together. Relax a bit before your loans start. Contact your lenders and clarify all the terms of repayment. Make sure you how much each payment will be, when they're due, and where to send the check. If you're planning on going back to school, ask the lender how your return will affect the repayment schedule. And if you're job hunting, take your loans into consideration when negotiating your salary. Stick to a budget. Paying your loans is a little like taking antibiotics. It's not fun, but you have to do it regularly until they're gone. Loan repayments will be a major expense for a long time, so when you figure out your budget, just take them right off the top. Investigate your options. If you plan on going to graduate school, or if you're unemployed, you can ask your lender to defer the loan. If deferment is approved, your payments are put on hold until you can afford them. Forbearance is similar to deferment, allowing you to hold off on your monthly payments. Unlike deferment, however, interest will accumulate during the time you don't make payments. Adjust your payment schedule. Normally, people make more money later in their career than earlier. You can modify your payment schedule to fit that model with graduated repayment. Your monthly payments will start small and grow slowly. Careful though - you'll end up paying more in the long run, so only use this option if you're afraid you'll have trouble making your monthly payment. Avoid overborrowing. Financial aid advisors are often concerned that students tend to borrow unreasonably. It seems obvious, but loans can pile up quickly. The money may seem necessary now, but you'll literally pay later. Don't default. It's easy to not pay your loans. After all, you might live 1,000 miles away from your alma mater. And the federal government seems like nothing more than the President appearing on television to apologize for something. But if you don't pay the Man for six months, you'll be in default. And to put it bluntly: lenders don't like that. Your school will most likely send a collection agency after your money. The federal lending agency will contact the IRS, which will withhold your tax refund. Your credit history will be seriously marred - ah heck, just don't do it.