How to Repay Student Loans

As a recent college graduate, it’s probably been a whirlwind of activity since you left campus. Maybe you moved, started a job, or even got married. You might have a thought in your mind that there is something important you should be doing, but can’t quite put your finger on it – until the student loan payment due notices start arriving, that is. Then panic starts to set in as you realize you have to start making those monthly payments. What do you do?

If you are the parent or the partner of a recent college graduate, you might be sensing that they are under a bit of financial pressure with trying to figure out how to manage their student loan debt.

Here are some things you can do together to help them get ready to repay those student loans:

First, Get a Grip

Find out exactly what you are dealing with in terms of loans. As you were borrowing the money, you may not have kept track of each individual loan, so you need to get a grip on what you owe. For your federal student loans you can log into the My Federal Student Aid site to view your federal student loan and grant history, see your loan servicers, and find out where to make your loan payment. If you have both federal and private student loans, request a copy of your credit report, which will show any loans in your name. You can also contact each lender directly to find out what your monthly payments will be.

Second, Get an Idea

Now it’s time to get an idea of exactly how much money you have to repay each month. If you have not already talked to your parents about whether they are willing to help out or not, do that immediately. Then, make yourself a quick budget to see what your anticipated income and expenses are. If income exceeds expenses, you are good. If expenses exceed income, you’ve got some thinking to do.

Third, Assess Your Options

Hopefully, you’re on track and ready to start tackling your student loans. But if you’re having trouble making payments, the first thing to do is contact your loan servicer immediately to determine whether you are eligible for a deferment or forbearance based on your current situation. This might help stop or reduce your payments temporarily. If you have federal student loans, you might want to explore alternative repayment plans which offer graduated payments, income-based payments, or extended payment time. Although you might find the lower monthly payments a little more comfortable, it could end up costing you more money in the long term and could take up to 25 years to repay. Make sure you understand what any changes in your payments do to the overall cost of the loan.

Finally, Consider Refinancing

If it is too much to deal with all of the individual loans, you might want to consider consolidation or student loan refinancing. Refinancing combines all of the loans into one new loan to reduce your monthly payment or lower your interest rate. You can apply for a Direct Consolidation Loan, which will consolidate your federal student loans, but does not include any money you might have borrowed from private student loan lenders. If you’re considering refinancing your federal loans with a private lender, carefully consider if you’ll lose your special benefits like public service forgiveness or income based repayment before you commit.


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