How to Successfully Manage Your Student Loan Debt

Written by on October 24, 2012 in Money - No comments | Print this page


Many people come out of college having accumulated at least a little (OK–sometimes a lot!) of student loan debt. Some individuals, like doctors or lawyers, can end up several hundred thousand dollars in the hole even before they’ve seen their first patient or tried their first case.

No matter how much the amount, many graduates feel a sickening sensation when faced with the prospect of having to repay what they borrowed. While it can be daunting looking up at the mountain of bills, there is plenty of debt help available for newly minted graduates.

First Steps

The most important thing is to be absolutely clear about the loans themselves. That means understanding the repayment terms, the grace periods (the time allotted before repayment must begin) and the interest rates. Figure out which loans are federal and which are privately held loans. This is important as the programs for repayment vary widely. Make a chart of all loans and amounts owed, as well as the companies servicing the loans.

Assess Financial Situation

Some graduates will be lucky to land high paying jobs right out of college. Smart graduates will use this time to concentrate heavily on getting their student loans repaid in full as fast as possible. Many graduates will struggle for a while after graduation. Some may not be able to find a job in their fields, while others may have to take lower paying entry level positions. The most important thing is not to ignore the student loans! Ignoring them or debt in general, will not make it go away!

Develop a Repayment Plan

There are a number of programs available to graduates to assist them with student loan repayment.


This means all individual loans are wrapped up in a single loan. One interest rate; one payment. This can help streamline repayment and help with budgeting. Be cautious, as some subsidized loans cannot be consolidated with unsubsidized loans.

Income Based Repayment

Just recently, the government instituted income based repayment options for loan repayment. Low income earners can apply to have their loan payment amounts based off of their income. This can be a lifesaver for graduates just starting out in entry level positions.


Most federal student loans have a nine month grace period. However, deferment can be arranged if the graduate is suffering from certain types of hardship (like not being able to find a job). Deferments should only be used as a last resort as interest will still accrue—meaning the loan amount will continue to grow.

No matter what the situation, developing a plan, meeting the student obligation head on and receiving debt help before you’re in over your head, will always be the best bet. Yes college is expensive, (another reason to attend a less expensive school in the first place) but so is ignorance.

This is a guest post.   Stephen Craig is a part of an elite team of writers who have contributed to hundreds of blogs and news sites. Follow him @SCraigSEO.


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