Let me admit right up from that it’s much easier to tell you how to manage your debt
than it is to actually manage it. Life happens and the car needs repairs and money gets
tight. Part of the reason people have so much difficulty managing their student loans is
that the program makes it so easy to delay payment. Having said that …
- Many lenders will work with you to set up an automatic debit from your checking
account so you don’t forget.
- Many lenders have a rebate program for on-time payments, either cash back or
interest-rate reduction or both. These programs are frequently tied to their automatic debit program.
- If you are fortunate enough to have Perkins loans, do whatever it takes to find employment in the appropriate field and location so that you can have those loans forgiven. That’s up to $20,000 that you don’t have to pay back.
- If you qualify for deferment, use it. Don’t go for forbearance because the paperwork’s easier. Don’t try to tough it out. Use the deferment. You have an interest rate advantage even if your loans are unsubsidized. If you find you can make the payments after all, set the money aside and at the end of the deferment, make a lump-sum payment.
- If you must use forbearance, make at least the interest payment. It will keep the loan from growing. Just because you don’t have to make the payment doesn’t mean you can’t make the payment.
- Keep in touch with your lender. They really do want to help you get clear of your loans.
- If you are in the unfortunate position of receiving collection calls, take the call. Those folks know more about the loans than you do. They know how to work the system. And their employee rating is dependent upon helping you find a viable solution, so they’re motivated.
For other suggestions on managing your student loans wisely, read “Surviving Your Student Loans”.
