College loans got you stressed? Find your best plan to pay them back
Wasn’t college fun? Sure – waking up for an 8 a.m. class and term papers might have been enough to send you into a tailspin at the time, but in hindsight you probably realize you had practically nothing to worry about. This is especially true if you’re feeling the burn of student loans today.
College grads holding a bachelor’s degree carry an average of $19,000 in loans. If they’ve got a master’s, it’s more than double that amount. While the average starting salary for graduates with accounting degrees is considerably higher than the national average salary for college grads ($30,000 vs. nearly $44,000) student loan debt can still be hard on your budget (and your credit).
Don’t resign yourself to decades of Ramen noodles and analog TV just yet – there are plenty of options out there to help you make those monthly payments a little more palatable.
Postpone it
No, that doesn’t mean throw your bills in the trash and instead spend your money on nice dinners for you and all your friends. But, if you’re going to grad school, having trouble finding a job or experiencing economic hardship, this is one way to go, as with some federal loans you won’t rack up interest until you start paying. For more information and to find out how to apply for loan deferment, check out Students.net.
Stretch it out
Having trouble making ends meet right now? You can lower your payments by lengthening your loan period. Standard loan terms are usually 10 years depending on the amount you owe. Extended terms will give you 12-30 years to pay. Be careful—you’ll be charged more interest over the longer term. Once you get on your feet, be sure step up your payments.
Consolidate
While combining your loans into one might not always significantly lower your payments, it can help your credit score, Young Money.com points out. More open accounts lead to a lower score. The better your score, the lower interest rates you’ll pay, so maybe you really can afford that car with amenities such as power steering and hubcaps.
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LAST UPDATED 9/4/2008