What I wish I had known about paying back student loans (But was too young and naïve to ask)

Young couple struggling to pay their student loans.

When I graduated with my master’s degree in 2006, I had no idea about the road in front of me. All I knew was that I was on my own, 600 miles from my family, no job and no job prospects, and $35,000 in student loan debt. I sat through the required exit interview and, even though I’ve always been “a math person” the numbers swam in circles around me. To consolidate or not to consolidate? Subsidized and unsubsidized? Long repayment term versus short repayment term? So I followed the majority of my classmates and consolidated, making use of the longest repayment plan possible (after all, that means the lowest payments!).

And eight years later, where did it get me? No missed or late payments, but still $22,000 in debt. Hindsight wishes I had created a game plan for what to do before I graduated, but I know I need a plan for today as well. I’ve been able to put the tools of Apprisen and financial counseling to work for me, and we’d like to be of help to you as well.

  • What does the terminology mean? Had I known about the fine print of the consolidation I chose, it would have saved me thousands in interest. Get educated on what you are signing as well as what other options you may have. For example, knowing the difference between deferment and forbearance (both of which will allow you to put off payments for a length of time) can save on accrued interest.
  • What is out there for assistance? Once you have a loan, what can be done to change it? Can you consolidate or refinance them? What about income-based options? Would setting up automatic payments help the interest and/or payment?
  • What is the big picture? Student loan payments can be daunting. Depending on where you went to school and for how long, they may be the single biggest payment you make monthly. But it’s still part of a complete and balanced financial diet – and your budget plan needs to work for ALL your obligations, including the student loan.

If you need resources, education, or planning help, Apprisen is here to offer assistance. Starting this month, Apprisen offers a FREE Student Loan Education session where you can work one-on-one with Apprisen to review these types of questions and find answers that make sense for your life. As part of the session, Apprisen will look at your finances and help you to develop a budget that will work with all of your bills, not just your student loans.

My goal for 2015 is to set a better budget and put more toward this debt in order to cut down on the principle and pay it off sooner as well as look into forgiveness programs. I have (somewhat) jokingly said that it is my goal to become student debt free before having to contemplate helping my son with student loans. My son just turned four. Though it may feel like I have fourteen more years of being tied to student loan payments, that is definitely an exaggeration. I am learning and choosing how to make the most of my money rather than having those debts own me.

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