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Try To Look At The Big Picture

The best thing you can do is to have a plan. If you have a plan before going into college you will be ahead of the game. However, most students do not do this for so many unknown variables. Even so, after graduating it’s even more important to begin a very solid plan and to stay with it.

There are practical ways to ease the pain, starting with choosing an affordable education and borrowing at the lowest rate, usually with government sponsored loans for students and PLUS loans for parents.

Student loans are a necessity for most students, but like any loan, they should only be used as a last resort. When it comes time to pay them back, you should concentrate on other high-interest debt first, and then concentrate on student loans.

Always make the monthly minimum payment; yet realize that the interest rate on student loans is usually low, so they are not as important at the moment as other debt. In fact, student loans at first are more of an annoyance than anything else.

With ten-year terms, they seem like they will never go away. Yet with a little determination and planning, you will be able to pay them off at least three years or more ahead of schedule. It just takes discipline and patience.

Taking Your Student Loan Off The Front Burner

If you have bills to repay with high interest before tackling your student loans here are a few suggestions.

Postpone repayment: You are entitled to a deferment if you go back to grad school, can’t find a full-time job or experience economic hardship.

Lower your payments: Struggling on an entry-level salary? You can lower payments by stretching out the loan term. You’ll pay more interest over the long run, but this move could get you over a hump. You can bump up payment later.

Borrow smart if you go back to grad school: Graduate and professional students can also use low-cost Stafford loans. Need more money? You can borrow up to the full cost of attendance with PLUS loans, now available at a rate of 8.5 percent.

Consider consolidating your loans: You won’t necessarily get a lower rate, but you’ll get the convenience of a single payment plus other perks.

Get someone else to pay: Join AmeriCorps and/or Teach for America programs which help you with grants to pay off your loans.

As stated earlier, credit cards and other high-interest debt should be eliminated before you decide to tackle your student loans. You can then fully concentrate on your student debt. What I did was paid off my car and then took that payment of $295 and used it monthly to pay down my lower interest student liability.

As your higher interest debts are paid off you go on autopilot and begin to send in double payments on your student loans. This will decrease the life of the loan and save you a lot of interest money.

Once again, you must establish a plan. If not, the money will seem to slip through your fingers so easily without knowing how or where it went.