By Matthew Jade, email
Student loans can be quite stressful for young adults. Everybody knows about the student loan crisis the country is currently facing with $1.2 trillion in debt. A student in average graduates with around $50,000 in debt, a number that has risen drastically in the last decade or so. For those who pursue post-grad degrees, switch majors, or go back to school, the number can be even higher.
While for some students, student loans are a necessity to get through college, others take it as free money; something to deal with once they graduate. Whatever the case is, student loans are taking a toll on the mental health of young adults.
Here are some ways you can smartly deal with your student debt, pay them off quickly without a lot of interest mounting on it.
Know Your Loan
The first step in dealing with a student loan is understanding the loan itself. As teens and young adults, we tend to live life on day at a time, forgetting our responsibilities and liabilities. Hence, most students don’t know exactly how much they owe, and who they owe, until after graduation.
To get going, check the National Student Loan Data System to find out if you owe any federal loans. If you’ve taken loans from private lenders, you will have to contact them directly. Another option would be to ask for a free copy of your credit report to see who your lender is.
Make Smart Repayments
If you’re repaying multiple loans, find out which one has the most interest attached to it; be sure to pay it back first and foremost. Most lenders also offer flexible repayment options. They can be income based repayment plans (IBR) or pay as you earn plans (PAYE); both give you a more manageable repayment option keeping in consideration your current monthly income.
Budget Your Lifestyle
Once you find out how much you owe and how much you have to pay out monthly, you should focus on creating a monthly budget and sticking to it strictly. When making the budget, try and cut down extra expenses and keep your student loan repayment at the top of the list of priorities.
Loan Forgiveness Is An Option
Because the main goal of getting a degree is getting a job, why not get a job that helps you reduce your debt while you still earn. Depending on the sector you work in, loan forgiveness can be an option. Mostly, loan forgiveness programs are offered to people working in the government or at a not-for-profit.