For many young people, graduating from college is one of the most important accomplishments achieved at this point in life, but it is also one of the most expensive. Even if you begin your path towards post-grad adulthood by working full-time, moving into your own place, and paying bills, if you have student loans, chances are that a sizable chunk of your income goes towards paying them down. For example, millennials who graduated in 2014, left with their degree in one hand and roughly $33,000 worth of student loans in the other, so you can just imagine what today’s graduates experience. While this hefty price tag (which can increase by 10 percent every five years) may have put some graduates at a disadvantage financially, there are many resources available to help effectively manage scholastic debts while setting oneself up for future financial success. Whether you want lower payments, assistance with paying down your loans, or have your loans forgiven altogether, continue reading to learn about all the options available to you.
Maintain More Manageable Payments
After the six-month grace period, following the completion of your education (however, in some cases, this can be extended), you are required to begin paying your loans back, but that can be difficult for a variety of reasons: expensive monthly payments, economic hardships, or unemployment. It is important to know what you can afford in order to pay your student debt off while still maintaining your other financial responsibilities.
Repayment plans are chosen during your student loan exit counseling session and the purpose of this is to help you decide the best repayment option for you and your financial situation. There are six repayment plans that you can choose from and each plan can be determined by your income or overall financial situation.
Another method to make your loans more affordable is to refinance your loans, which allows you to apply for a loan under new and more favorable terms so you can pay them off more easily. If your financial situation has improved since taking out your loan, you may be eligible for a lower interest rate, reduced time on paying down your debt, and even a lower monthly payment.
There are marketplace lenders, like the ones listed below, that provide reliable refinancing options:
Consolidating a loan takes multiple loans from several lenders and combines them into one large loan, which in turn gives you one payment. This usually helps make your payments more manageable. There are pros and cons to consolidating your debt; for example, loan consolidation may be the best choice for you if you want to lower your monthly payments and extend the length of your loan. However, loan consolidation may not be a likely choice if you prefer to consolidate loans into a private loan consolidation or keep your grace period, which can be shortened to as little as two months to begin paying back your loans. Refer to Debt.org’s Pros and Cons Consolidating Federal Student Loans chart to figure out if loan consolidation is right for you.
Take advantage of Public Service Loan Forgiveness Programs
You could get your loan forgiven in 10 years through the Public Service Loan Forgiveness (PSLF) program. To qualify, you must be financially compensated for full-time work from government, 501(c)(3) nonprofit, Peace Corps, full-time AmeriCorps, or a private “public service organization employment. However, to take advantage of this benefit, you must have any of the following loans:
Two important things you must do to really use this resource is one: make sure you sign up for the program, and two: keep track of your employment by having copies of your W-2s, pay stubs, and other documents that can prove gainful public service employment. You want these documents in case you switch jobs that are still in the public service field.
Let time pay for your Student Loans
Another way to get your student loans paid off is through military service. Depending on the service branch you choose to enlist in, the student loan benefits will vary. For example, if you chose to join the Army as an Active Duty Solider, you could have up to $65,000 of your student loan debt paid off over the course of three years.
Volunteering and Trivia Can Help You Pay Down Student Loan Debt
Most times, when you think of a crowdfunding site, you think of sites like Kickstarter, Indiegogo, or GoFundMe, that help individuals fund their start-up, a cause, or even a personal goal. However, there are now crowdfunding sites exclusively created to help you pay for your student loans through the power of social impact and game trivia!
These resources will hopefully help you keep a few extra bucks in your pocket and allow you to do more of the things you are passionate about. Over time, your debt should start to lighten up, while keeping more money in your pocket for the rest of your post-grad life. No one wants to stress about that monthly student loan bill looming over their head more than necessary and these available tools can help make your debt-free dream a reality.