How to Manage Student Loans

Americans are drowning in student loan debt. In fact, over 44 million Americans have student loan debt. And, the student loan debt total is now more than $1.5 trillion.

If you’re one of the 44 million Americans who owe money on student loans, then you’re probably wondering how you’re going to pay them off.

If the stress about paying off your student loans is getting to you, you’re not alone. In fact, one study found that 67 percent of borrowers have experienced physical symptoms of anxiety due to stress from student loans. And, 65 percent reported losing sleep at night due to stress from student loans.

But, just because you have student loans doesn’t mean you can’t achieve financial freedom. Check out this guide to learn how to manage student loans.

1. Take Advantage of the Grace Period

Many lenders offer a grace period (aka, a time post-college where you don’t need to pay any money on your loans).

During this grace period, many people fall victim to spending their money like crazy and forgetting about their loans completely.

However, what you should be doing is taking advantage of this time to make a game plan for paying off your student loans. In fact, it’s a good idea to start making payments during this period if possible. Otherwise, start to save up and prepare for what’s ahead.

2. Understand Your Payment Options and Choose One

There are several different payment plans for student loans.

For example, based on what earn, you could choose an income-based repayment plan based on how much you’re earning. Or, you could do a pay-as-you-earn payment plan. Both of these options allow you to set up a manageable minimum monthly payment plan according to your income.

If you have difficulty keeping track of your loans, you may also want to look into student loan debt consolidation.

Also, remember that the most important thing to do is to start by paying off the loan with the highest interest rate.

3. Stick to a Budget and the College Lifestyle

Just because you’re working a full-time job doesn’t mean you can start spending like crazy.

Sure, you may want to be done with ramen noodles and used furniture, but that doesn’t mean you completely quit living the college lifestyle. Here are some things you can do to cut back on expenses:

Continue living with roommates
Skip the pricey concert tickets, dinners, and bar tabs and instead opt for free things to do around your city and cheap nights in
If you live in a city, take advantage of public transportation
Cook from home as much as possible
Use apps like Pogo, Fetch rewards, or Bitmo to reduce the effective cost of your purchases
Share Netflix, Spotify, Amazon Prime and other accounts with family members

When you’re tempted to splurge, just remember that every $100 you spend on a new outfit could be $100 put towards your student loans.

The last thing you want is to get sued over your debt later on, so do your best to stay on track. (And check out this guide to learn how to protect yourself from a lawsuit over debt.)