How to Survive Your Student Loans

student loansIt’s no secret that student loan debt has gotten wildly out of hand in the past few years; in 2015, there was $1.2 trillion in outstanding student loan debt. But what else are you supposed to do?

Getting a decent job is pretty much impossible without at least a bachelor’s degree and tuition is just flat-out expensive. Even with substantial financial aid, a lot students need federal or private student loans to afford tuition. Jumping on board the alarmingly large student loan ship is an intimidating prospect, but research, budgeting, and organization can help you meet your student loan payments and repay your debts on time.

1. Pay While You’re in School

The sooner you start repaying, the better. If you can, begin making payments while you’re still in school. Even if you can only afford student loan interest payments, every little bit counts. If you begin paying your interest, it means you’ll have less to repay later. While most lenders don’t require you to pay while you’re still in school and offer a six month grace period after you graduate, it’s a good idea to pay as much as you can, as soon as you can to prevent interest from accumulating. Consider taking on a part-time job to help you cover these expenses.

2. Select a Repayment Plan That Works for You

Once you’ve graduated and your grace period has ended, you’ll need to start repaying your loan. Select a repayment plan that works for your budget. With student loan interest rates at their current levels, it’s best to repay your loan as quickly as possible. If you have federal student loans, there are several repayment plans that you can select.


Over a course of 10 years, this plan allows students to make scheduled, substantial payments every month. If you feel confident that you’ll be able to make regular repayments of least $50, then choose this plan. It will help you accumulate the least amount of interest.


If your student loans total more than $30,000, then you qualify for the Extended Repayment plan. It prolongs your loan term to 25 years, which also reduces your monthly payments. The downside of this plan is that the longer you take to repay your loans, the more interest will accumulate.

Income Based

When you choose the Income Based Repayment plan, your monthly payments are based on your discretionary income, not the amount that you owe. Discretionary income is calculated by subtracting your adjusted gross income from 150% of the poverty line for your family size. Like the Extended Repayment plan though, the interest that accumulates throughout this plan’s longer loan term can eventually wind up costing you more than the original loan. But the good news is that after 25 years of repaying on this loan, your remaining debt may be forgiven. We call these the Secret Student Loan Forgiveness Programs.

If you’re considering private student loans, be sure to check with various lenders about their repayment plans before committing to a loan.

3. Pay Extra When You Can

Regardless of the payment plan that you choose, you should always pay extra when you can. The more you pay, the less interest your loan will accumulate. Prolonging your ramen diet, scrimping on utilities, and cutting back on spending can all help free up money to repay your loan.

4. Consider Student Loan Forgiveness

After you’ve graduated, taking a position in public service can eventually help forgive some of your federal student loan debt. If you serve 10 years in a public organization — police, fire, government, military, public education, public health, social work, public interest law, or public library — and meet certain income specifications, your loan may forgiven. Be sure to talk with your lender about this option.

Also, almost every state in the United States offer student loan forgiveness programs as well. Make sure you check out this list of State-based Student Loan Forgiveness Programs.

5. Let Your Lender Know If You’re Having Trouble

If you realize that you may have trouble making your monthly payment, contact your lender right away. They may be able to work with you to adjust your repayment play while you’re going through financial hardship. More students than ever are shouldering a heavy debt burden, but you need think of them as an investment in your education and your future.

While making monthly payments for years to come may not be ideal, don’t let yourself get discouraged. Be frank with yourself about your finances, though. Careful organization and a realistic view of your month-to-month budget can help you make your payments on time and repay your loan without any excess hassle.

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  1. says

    My favorite way to survive them is throw large amounts of money at them until they disappear. When they’re gone you have survived. I understand this isn’t an option for everyone but for people with disposable income and higher interest rate student loans it is definitely an option.

  2. says

    Great blog. Great tips. Often paying back a student loan is the first “buried in debt” experience for a young adult. Because the debt amount can be so great it’s a tough one to tackle. On a positive note, if a young adult can conquer that debt the experience (hopefully) will resonate with that person through the rest of their life thus positively affecting all future financial decisions. Handling that student debt can be a great lesson in financial management. That debt bug will come knocking on the door again once you have a mortgage, spouse, kids and cars… and those sound financial lessons will make it easy to stomp on it.

  3. says

    Great tips! The only one I would add is to keep living like a student after you graduate. Even if you start making good money it so much easier to pay off student loans if you keep yourself artificially poor.

    Thanks for the great site!

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