Congrats, Class of 2018! Graduating from college can be exciting, but life after college can be frightening and stressful. You are faced with major decisions such as launching a job search, deciding to begin a career, relocating, or continuing your education. Basically, adulting is hard. When you get your first student loan bill in the mail, don’t panic! This is the part of adulthood we want to make easier for you. Here are some tips that may help you, or someone you know who is about to go through the loan repayment process.

1. Don’t ignore your student loans!
Unfortunately ignoring your student loans won’t make them go away. (We don’t make the rules, we just enforce them.) Student loan default is actually a bad move when it comes down to the consequences of missing student loan payments. You can be sent to a collection agency, and the government can garnish your wages and/or tax refunds. If you cannot afford your payment, contact us for help. No matter your financial situation, your servicer can help you find a more affordable payment option.

2. Set a budget
Even though your payments aren’t due until 6 months after you graduate, start including your student loan payment into your budget NOW. That means planning your after graduation budget around your fixed bills, like rent, utility bills, and your projected student loan payment. If you haven’t done so already, complete exit counseling to work on a post-graduation budget that includes your estimated student loan payment. 

3. Research forgiveness options
A very high percentage of borrowers do not take advantage of the various loan forgiveness options available. If you qualify, you may want to re-consider the payment plan you have elected. These plans are very finicky because you have to have the right type of loan, and be on the right payment plan for it to be effective. 

4. Sign up for automatic payments
I think we can all agree that paying student loans is no fun, but auto pay can make it easier. With auto pay, you don’t have to remember to log in and make your payment every single month! It ensures your payment is always in full and on time –just elect the bank account you want to make payments from. This can all be done via your servicer’s website online. As an added bonus, you will also receive 0.25% off the interest when you sign up for auto-pay.

5. Make extra payments
If you can, pay more than the minimum. Even paying as little as $50 a month more can shave years off your repayment term. This is a great concept that applies to any debt management strategy. Want to pay your loan off earlier? Pay more than the minimum! Want to save yourself tons of interest? Pay more than the minimum! Want to get more out of life? Pay more than the minimum! 

6. Don’t postpone payments unless you really need to
During your exit counseling, you probably learned about deferment and forbearance. This can be a helpful solution if you’re experiencing a temporary hardship, but can be costly if used as a long-term solution. In most cases, interest will continue to accrue on your loan while you’re not making payments and it will also capitalize (when interests accrues on interest = baaaaad). And when you go back into repayment, your loan balance will be even higher than it was before. If you need to seek forbearance for financial hardship, be sure to contact your servicer about going into an income based repayment instead.