Loan Repayment

Below are some tips for managing the repayment of student loans after graduation.

Estimate Your Income

1. Research entry-level jobs in your chosen field and expected location.
   • Bureau of Labor Statistics Occupational Outlook Handbook.
   • Google job postings in the area you plan to live.
2. Calculate net income after taxes and deductions here.

Create a Budget

Here are some basic budget categories you should consider when creating a budget.

1. Health Insurance
2. Phone
3. Car Insurance
4. Rent/Mortgage/Property Taxes
5. Utilities
6. Food
7. Car Payment
8. Gas
9. Personal Supplies (Makeup, Haircuts, Clothes)
10. Medical Expenses/Copays
11. Entertainment
12. 401 K/IRA/Retirement Plan Contribution
13. Credit Card Debt
14. Internet Costs/Cable Costs
15. Furniture/Household Furnishings
16. Emergency Fund Contribution

Afford Your Monthly Payments

Know Who You Owe and How Much You Owe

1. Federal Student Loans
2. Private Loan Payment Calculator

Choose Payment programs

1. Federal Loan Repayment
   • Compare your budget and your estimated federal loan payment.
   • Choose standard payment if you can afford it.
   • If you can’t afford standard payment, recalculate and choose Income Based/Contingent or Graduated repayment options to lower your monthly payments.
2. Private Loan Repayment
   • Compare your budget and your estimated private loan payment.
   • Look at areas in your budget that you can reduce to afford your private loans.
   • If you can’t cut your budget, contact your private loan servicer and ask them what reduced payment options exist.
3. Consider Consolidation
4. Worst Case Scenario (if you still can’t afford your payments) - Last Resort
   • Don't Panic: Contact Your Lender About
     • Reduced Payments
     • Deferment
     • Forbearance

Consider Graduate School as an Option

1. Postponing graduate school for 1-2 years can allow for paying down debts and exploring details about your field.
2. Going to graduate school right away allows you to defer your loan payments until after you are done with graduate school.

Strategize Repaying Debt

1. Pay smaller loans or higher interest loans first.
2. Find a financial advisor to help guide you in your payment strategy.
3. Make sacrifices to pay off debt sooner.
4. Consider your long-term goals when choosing what to sacrifice.

Explore Loan Cancellation/Forgiveness Opportunities

1. If you work in certain fields, such as teaching, nursing, healthcare, or for a non-profit institution, you may be eligible to have any remaining federal loan debt canceled after 120 on time payments. See these pages for additional information:
   • http://studentaid.ed.gov/repay-loans/forgiveness-cancellation/charts/public-service
   • http://www.finaid.org/loans/forgiveness
2. Some employers will pay a portion of your debt, so do not be afraid to ask potential employers about whether or not they offer this benefit.
3. If you have any interest in military or peace corps, there are additional loan forgiveness options available. Contact the branch you are considering directly, but thoroughly research requirements/lifestyle before deciding on this path. It's a huge commitment.