The Online Degree Dorm Room

Engineering Degree Online | Paying off your Student Loans

Posted by bposton on November 13th, 2006 — Posted in engineering degree online

So let’s say you have a rich uncle and you’ll have no loans to pay off after you graduate…

Well you can stop reading now, if you wish (you lucky dog)

For the rest of us, how to pay off our student loans is a big deal.

According to a recent study by the U.S. Department of Education, 26 percent of college graduates borrow at least $25,000 to pay for their college educations.

So if you see that you’re going to graduate with a large amount of  debt, you’d be wise to take some time and sort of “map out” a strategy for paying it back as quickly as possible.

Here are some tips to consider from American Education Services, a national financial aid services organization:

Consolidate. Consolidating your loans can reduce your monthly payments and maybe even lower your interest rate. But You need to look into this option as soon as possible to lock in a low interest rate. When you consolidate, you’ll get just one bill per month, which makes it easier to keep track of your payments.

If possible, make payments during your six-month grace period. This is a great way to save money on your subsidized loans because any payments you make will be applied directly to the principal balance. This lowers the amount of interest you will owe after the grace period expires. Plus, you’ll be able to pay off your loan months earlier than you expected.

Use direct debit to help you pay your loans on time every month. Direct debit is a free, automatic payment service for borrowers who prefer to make their loan payments electronically. If you use this service, you also may qualify for an interest rate reduction after a specified number of on-time payments.

Make everyday expenses count toward repayment of your loans. When you join Upromise, participating merchants will contribute a portion of what you spend with them to your Upromise account, which you can use to help pay off your loans.

AES has a web site called youcandealwithit.com, designed to help college students and graduates become financially responsible.

Hope that helps

Ben