Student loans can be overwhelming, especially while you're still in school. However, with proper planning and management, it's possible to handle the burden of student loans effectively. Be sure to listen to episode 73 of the podcast for a bunch of information on building a plan and managing your student loans while in school!
The types of student loans
When it comes to student loans, there are two main types: subsidized and unsubsidized. Subsidized loans are need-based, meaning they are awarded based on the student's financial need. The government pays the interest on these loans while the student is in school. On the other hand, unsubsidized loans are not based on financial need, and interest accumulates on the loan from the time it is disbursed.
While in school, it's important to understand the specifics of each loan and make a plan for paying them off.
Here are some tips for managing student loans:
Know your loan details: Keep track of the interest rates, loan balances, and repayment terms of each loan. This will help you better understand your overall financial obligation and make informed decisions about your loans.
Make interest payments: If you have unsubsidized loans, consider making interest payments while in school to reduce the amount of interest that accumulates. This will reduce the overall amount you will owe once you begin repayment.
Consider loan consolidation: If you have multiple student loans, consider consolidating them into one loan to simplify the repayment process and potentially lower your monthly payments.
Explore income-driven repayment plans: If you have a low income after graduation, you may be eligible for income-driven repayment plans that can lower your monthly payments based on your earnings.
Plan for repayment: Begin planning for repayment as early as possible. Consider your future income, job prospects, and monthly expenses when developing a repayment plan.
Consider forbearance or deferment: If you are unable to make payments, consider forbearance or deferment options, which allow you to stop or lower your payments temporarily.
Finally, managing student loans while in school can seem daunting, but with proper planning and management, it's possible to handle the burden effectively. Make sure you understand the specifics of each loan, consider loan consolidation, and plan for repayment to stay on track toward financial stability.
Money Talk with Skyler Fleming
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Email me at moneytalk@skylerfleming.com