With the cost of college rising every year, tens of millions of students plan on loans to cover the costs increase tuition, fees, books, room and board.
The average 2014 college graduate has $ 33,000 in loan debt for students, more than any previous class.
Although the repayment of student loans is never easy, we have 10 smart tips to minimize the penalties and budgeting for your future
Tip # 1: .. Understand the terms of your loan
loans are a new concept for most students.
Take time to talk with your financial aid office on the specific terms of your loan, including the interest rate, the principal and the size of your minimum monthly payments after graduation
This will help you design a repayment plan well before the first check is due
Tip # 2: ... Start repay as soon as possible
most federal student loans come with a grace period before they must begin to repay the loan, usually six to nine months after graduation.
If you have a good work part-time (or generous parents), there is nothing stopping you from making advance payments, just after graduation or when you are still student.
more you pay early, the less you will ultimately owe interest. Tweet this
Be careful, however, because some lenders actually charge a prepayment penalty.
Tip 3 :. Stay in touch
[1945001diplômésdescollèges] Recent tend to follow the career opportunities, moving frequently to chase a better jobsure to inform your lenders on changes. address.
Even if you get most of your loan information by email, you will not want to miss important information that could still come by mail.
Remember, missing a bill is not an excuse to miss a payment
Tip 4: Get a job ..
Get a job on time part in college or during the summer has its obvious advantages: the more money you earn to pay for college, the less you'll have to take in lending.
But there are other reasons to work during your college years.
by obtaining entry level jobs or internships in different areas, you can see what types of jobs are a good fit and how much they pay.
It's best to experiment now rather than after graduation when the student loan payments are due.
Tip # 5: ... and save budget
There is never too early to start living on a budget
stick to a budget does not mean forego any fun
It simply means taking a close look at how much you earn and dividing it up between recurrent expenses (rent, food, gas), and extras such as entertainment and clothing.
If you do enough, put some aside for savings or to start repaying your student loan early
Tip # 6: ... repay the loans of the highest of 'primary interest
Fortunately, most federal student loans come with relatively low interest rates
But if you filling out a federal loan with a private student loan, it is wise to pay higher interest loans first
not ignore federal loans altogether -. you still need to make minimum monthly payments - but repay private loans as quickly as possible
Tip # 7: .. Sign up for auto-pay
the best way to stay -Dessus payments of student loans is to have the payment automatically deducted from each paycheck.
If you get paid twice a month (every two weeks), make a loan payment twice a month. It chips away at your capital faster and reduces the interest over time
Tip # 8: .. Claim the deduction for student loan interest
The IRS allows you to deduct all interest paid on a qualified student loan on your tax return each year, regardless of whether you take the standard deduction or itemize deductions.
deduction is capped at $ 2,500 and is phased out for high income earners.
If you are claimed as a dependent on your parents back, then they can take the deduction. If you are also filing a tax return, you or your parents can claim the deduction, but not both
Tip # 9: .. Know your repayment options
if you lose your job or run into another financial setback that makes it impossible to track payments to federal student loans, you have some options.
you can request a postponement of unemployment, which stopped payments until you find a job. Or, you can ask for abstention, which can reduce or stop payments to 12 months.
Keep in mind that the interest continues to run, even if you do not make payments.
There are also programs like AmeriCorps and the Peace Corps that offer loan forgiveness for certain types of federal loans
Tip # 10.! not default
If you get too far behind on your student loan payments, you will eventually go into default.
Defaulting on a student loan could seriously damage your credit, making it difficult to qualify for future credit, including a mortgage or a car loan.
If you have payment difficulties to contact your lender about the postponement, forbearance or loan consolidation before it's too late.
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