It may not be your first priority, but preparing to repay your student loans should be on your pre-graduation to-do list. How you manage your student loan payments will shape your finances for decades to come, so know what you’re dealing with before you get swept up in the day-to-day demands of post-graduate life.
Before you leave school, also make sure you know the answers to the following questions. Good news: We’re giving you them (or at least telling how to find them on your own).
1. What Kind of Loans Do I Have?
You either have private student loans or federal loans. You can look up your federal loans using the National Student Loan Data System (NLDS). You should have the paperwork from your lender or student loan servicer (private and federal) from when you took out the loan. Private loans generally come from traditional banking institutions, while federal loans are issued by the government. Common federal loans include Direct subsidized loans, Direct unsubsidized loans and Perkins loans.
2. Whom Do I Owe?
You can find this information in the resources referenced above. Your financial aid office should have information on file as well, since they receive the money. If you haven’t gone through student loan exit counseling at school, you need to before you graduate. They’ll explain whom to pay, and it’s the perfect time to ask any questions. Once you know who’s managing your loans, set up an online account to access all your information.
3. What Are My Repayment Options?
This depends on the type of loans you have. Private student loan repayment tends to follow a typical installment loan repayment structure, in which you make monthly payments for a fixed loan term. Federal student loans offer more options. The default play is called standard repayment: fixed monthly payments for 10 years. If you want a lower monthly payment when you start out, you can change your repayment plan at any time for free, though the change may not take effect immediately. If you want to enroll in an income-driven repayment plan, graduated repayment or extended repayment, be sure to request a new plan through your student loan servicer as soon as you can. You can learn more about student loan repayment options here. ...continue reading
Popular logic when you are trying to improve your finances is to consider drastic measures to create a noticeable difference but making these major moves is not always the best course of action and a series of small changes can have just as much impact, if not more.
Here are some savvy financial tips to consider and some insights on how you can implement some lasting positive changes to your financial situation. Including a suggestion to take an alternative view on reaching your goals, why you need to analyze your monthly costs, plus some tips that should help you keep more of your cash.
Think small to improve the bigger picture
It’s easy to adopt the mindset that paying an extra $30 or so extra toward your credit card debt payments is hardly worth the bother and won’t really make much of a difference.
It is perfectly understandable that you look at the balance and think how can I clear the debt in one go? But it often pays to take an alternative approach to clearing your debts and adding to your savings pot.
Those seemingly insignificant additional payments actually make a substantial difference to reaching your goals and rather than keep wondering how you are going to raise a chunk of cash in one go, start chipping away at your balances with these small additional sums of money.
It is a good strategy to think small as those extra payments will ultimately get you to where you want to be a lot quicker than if you keep holding back trying to raise enough cash to make what you might consider a meaningful contribution.
When you are committed to clearing debt and putting more toward your savings, don’t try to do it all almost immediately, make regular additional payments when you can and also try to make small changes to your finances to help you free up extra cash. ...continue reading
If you’re having a difficult time getting approved for credit because you have a low credit score, working to improve your credit score can seem like a task that can take years to solve.
There are few quick shortcuts to improving a credit score, but there are some big moves that can raise it dramatically.
Here are some of the biggest moves you can make to improve your credit score:
Know your credit score
Start by checking your credit score at AnnualCreditReport.com for free. The three credit reporting companies must give you a free report once a year, so you can either get all three at once or spread them out by getting one every four months.
The score you receive represents your credit risk at a point and is meant to measure your future credit risk. Scores from the Fair Isaac Corporation, or FICO, are most widely used, with scores ranging from a low of 300 to a high of 850.
The higher the score you have, the more likely you are to be approved for credit and get the best loan rates for auto loans, home loan and credit cards, among other things.
Here’s a breakdown of what the scores generally mean: ...continue reading