If you’re like me, you may have had to take out a few loans in order to pursue your dream of going to college. When you accept your financial aid, the big decision of taking out loans may not hit you until after you go through the process and sign the papers. Although going down the road of student loans is an intimidating thought, it doesn’t have to be a scary experience. Even though the route of waiting until after graduation to pay off loans is a popular one, there are other ways to handle your loans. If you want to get ahead and start dealing with your loans while you’re still attending school, there are a few ways to do it.
First off, realize that having loans isn’t a life sentence. The thought of owing money was scary to me and I wasn’t sure that I could handle it or pay it back when I’m supposed to. However, many people take out loans for school, cars, houses and other parts of life. Taking out loans for an education is a smart choice and will pay off in the end. Also, take into account that you’re not alone. You will have family, financial aid counselors, as well as the people who are giving you the loans that will help and provide you with resources. They can talk to you about payment plans, interest, and other parts of your loan that may be daunting.
Looking at the amount of loans that you have can be intimidating. But it’s good to know the amount so you can start organizing. List your loans from smallest to biggest. That way, you’re able to break things down and it will be more manageable. Plus the fact that once you know what you owe, you can start budgeting and make a plan for how you’re going to tackle your loans. When you have the list of your loans together, you can actually start trying to pay off those loans.
If you happened to take out unsubsidized loans, you’ll probably know that interest will accumulate even for the duration of time when you’re enrolled in school. Even though you still aren’t required to pay on those loans until after graduation, it’s still a good idea to get a head start. I’m not saying to put all of your spare money into the interest on your loans. But, if you happen to have a job and are able put a little bit of money into it every month or so, it’s best to do that. Make sure to look at your interest rate to see how much interest will actually be added, then make a budget with that in mind. Interest can add up quickly, especially over the years that you will be in school. Knocking the interest down now can save you money in the future.
If you’re able to save up bigger amounts of money, paying off your loans in whole is a good option. Even though it may take a while to actually save up the whole amount, you will be saving yourself money in the long run as your loan won’t have time to accumulate more interest. Paying on your loans during your second year of school instead of waiting until after your last year could potentially be saving you hundreds of dollars as you’ll be dealing with the loans earlier.
Taking the route to start thinking about your loans while still in school is a smart one and you’re preparing your future self. Dealing with loans right out of school is the last thing you want to do on top of thinking about getting a job, moving out, and other important steps that you might have to deal with once you graduate from school. If you’re able to do something to cut down your loans, go for it! You’ll be saving yourself some stress and money down the line.