Tips For Paying Back Student Loans

American Investment Planners LLC

500 North Broadway, Suite 260, Jericho, NY 11753

(516) 932-5130 / (866) 932-5130

If you have a child who will be graduating from college this May or a few years down the line, then you are probably very familiar with student loans. In fact, you may even already be thinking about how you plan to pay them back or may be starting to talk with your child about strategies and approaches to avoid falling too far into debt once the first payment is due.

With the cost of college continuing to rise, we know how intimidating the process of paying back student loans can be for both parents and their children - that's why we put together the following list of tips to help make the experience less stressful:

Understand Your Loans: First and foremost, it's extremely important that everyone with loans in their name understands exactly how they work. That means being aware of who the lender is, how much has been lent, and what the repayment options are for each loan that has been taken out. Additionally, it is also important to know what the grace period is for each loan and be familiar with how much interest will be applied since it can heavily impact your total costs.

Keep Your Information Up To Date: Before it's time to start paying back loans, check to make sure that all of your contact information is current. Since you will likely receive electronic notifications and paper statements pertaining to your loans, you will want to make sure that your lender is sending them all to the right place. Even if you do something as simple as update your email address, be sure to keep in contact with your lender and update your information so that you don't miss out on important messages - it could cost you down the line!

Start With The Highest: If your loans allow you to pay by group, start by paying off the one with the highest interest rate. Even if the total loan amount isn't the greatest, tackling the highest interest rates first will help you accrue less in additional charges over time. Of course you will need to act in accordance with your repayment plan, but if you have the opportunity to choose which loans you pay off first, make it a priority to get your highest interest rates out of the way.

Although it may seem overwhelming when your first statement arrives, if you have a plan in place and keep a close eye on your loans, you'll likely find that the task of paying them back isn't so difficult after all! 

As one of the largest and most respected independent financial planning firms in the country, the team here at American Investment Planners LLC realizes the impact that student loans can have on a family's financial situation. If you have a child that will be entering college in the future, click here for a list of savings strategies that can help, or give us a call at (516) 932-5130 to get started on your financial plan; our team will come up with a method of savings that will benefit you and your family in several financial aspects of your life.