Kiplinger has an article up touting different ways to lower or pay off your student loan bills that I thought might be useful to some of you who are graduating in a month or so. My wife is finally finished with all her schooling in a scant 2 weeks, but we will now have student loans to pay off starting in as little as 6 months. Luckily we already consolidated all of our loans into one payment, and we can adjust the schedule to fit our budget. Here are the tips that Kiplinger had to offer:
Postpone repayment. You’re entitled to a deferment if you go back to grad school, can’t find a full-time job or experience economic hardship.
Lower your payments. Struggling on an entry-level salary? You can lower payments by stretching out the loan term. You’ll pay more interest over the long run, but this move could get you over a hump. And you can bump up payments later or switch to a shorter term.
Borrow smart if you go back to grad school. Graduate and professional students can also use low-cost Stafford loans. Need more money? You can borrow up to the full cost of attendance with PLUS loans, now available to grad students at a low rate of 8.5%.
Consider consolidating your loans. You won’t necessarily get a lower rate, but you’ll get the convenience of a single payment plus other perks (for more on consolidating loans, go to www.finaid.com).
Get someone else to pay. Join AmeriCorps or Teach for America and you’re eligible for grants to help you pay off your loans. Teaching in a low-income school may also qualify you for loan forgiveness. Some occupations forgive loans as a recruiting tool.
And don’t forget: If you meet income requirements, you can deduct up to $2,500 per year in interest on any loans used for higher education.
Be sure to not miss that write off, we have been writing it off for years now. And even though it is only a small amount, every little bit helps. Good luck and congrats to anyone who is graduating in a few weeks!