Steps to Take When Repaying Student Loans

It’s barreling down on us— just weeks away now. For millions of Americans, the pause on student loan payments is coming to an end August 30th with payments due October 1st. For over three years now, forbearance removed a hefty line item from people’s budgets. It can be difficult to remember what that payment even was. Many do not know what they used to pay, as that part of their budget was moved elsewhere. And who could blame them? We’ve had relentless inflation since those last payments were due. That $300 a month going towards student loans now goes towards increased rent. It goes towards groceries, auto insurance, haircuts, or any of the other necessities that have ballooned in cost.

So, what can be done about this situation? Do you place your loan servicers statements in the circular file and pretend you never saw? While some will undoubtedly take this approach, I assure you this is not the solution. Whether you agree with Washington or not, there is no avoiding the return of payments. There are, however, ways to prepare that will soften the blow and make you feel more in control of your finances. Follow the steps below to tackle the debt head on and avoid making the situation worse.

1. Information is your friend. Login to your online portal and find out what the payments will be and when they will be due. If you can’t remember your login information, go to StudentAid.gov and use the Ask Aidan chat feature in the bottom righthand corner. Update your contact information while on StudentAid.gov.
2. Get organized. Make a budget and practice sticking to it. This will give you confidence regarding your ability to make payments.
3. Time is still on your side. Use the interim period to incorporate the monthly payment into your budget. Try setting the money aside each month to see if this is doable. If you are having trouble, see if there are ways to trim fat from your spending. It’s better to find this out now than in the fall.

The advice above is broad and applicable to most everyone with student loan debt. If you want specific advice for your situation, give me a call. I would love to help you with your financial plan.