Plotting a Course Through Post-Graduation Financial Waters: Student Loan Exit Counseling and Successful Student Loan Repayment
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You’ve tossed your cap and received your degree. Now it’s time to start planning to repay those student loans that helped you get there.
First, it’s essential to talk about student loan exit counseling. It may seem like just an administrative hurdle to clear before graduation, but it’s a crucial opportunity to gain a deep understanding of your rights and responsibilities as a borrower. During exit counseling sessions, you’ll receive valuable information about repayment options, grace periods, interest rates, and loan consolidation opportunities. Pay close attention, and don’t hesitate to ask questions.
After you’ve completed your exit counseling, consider these tips to start student loan repayment on the right foot.
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Know Your Loans: Inventory all your student loans, including federal and private loans. Understand the terms and conditions of each loan, such as interest rates, repayment plans, and grace periods. Organize this information in an easy-to-access way (like a spreadsheet or a file folder).
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Create a Spending Plan: Establish a realistic budget for all expenses, including rent, utilities, groceries, transportation, and loan payments. Find a method of tracking expenses that works well for you, such as a budgeting app or spreadsheet, to keep you aware of your expenses and help you stay within your means.
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Explore Repayment Plans: Federal student loans offer various repayment plans, such as Standard Repayment, Graduated Repayment, and Income-Driven Repayment (IDR). Utilize the loan simulator on StudentAid.gov to evaluate each option carefully and choose the one that best aligns with your financial situation and goals.
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Loan Consolidation or Refinancing: If you have multiple federal loans, consolidating them into a Direct Consolidation Loan may simplify your repayment process. Refinancing your loans with a private lender may lower your interest rate and potentially reduce your monthly payments.
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Take Advantage of Grace Periods: Most federal student loans come with a grace period — typically six months — before you’re required to start making payments. Starting to budget for this payment, before you’re required to, will allow you time to get used to that money being gone. Add the money to your savings account. You’ll have a built-in emergency fund to help you avoid more debt if something unexpected should happen while you’re in repayment.
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Make Timely Payments: Missing loan payments can result in late fees, penalties, wage garnishments and damage to your credit score. Set up automatic payments or calendar reminders to ensure you never miss a deadline. If you anticipate having problems making a loan payment on time, talk to your loan servicer at the first sign of trouble.
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Explore Loan Forgiveness Programs: Depending on your career path, you may qualify for loan forgiveness programs, such as Public Service Loan Forgiveness (PSLF) or Teacher Loan Forgiveness. Research eligibility requirements and consider how these programs align with your career goals.
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Mark your calendars for upcoming OKMM 'Make It Count' webinars on the third Tuesday of every month. Join us on Tuesday, July 16, at noon as we discuss how to successfully live on a college budget.
We will explore the basics of setting up a successful budget and cost-saving tips for living on less while you're in college.
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We offer webinars for educators, students and parents on budgeting, saving, credit, and more. If you want to schedule a webinar, complete our workshop form, and we'll contact you to plan the details.
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