<p>Not sure where else to post this so here goes...
I'm going to be a college sophomore this fall, but already I'm thinking about how I'm going to pay back loans after college. I know that plans can fall through, but this is mine:
Right now, I have a lot of stuff I want to do. Road trips, health investments, clothing. It is better to do all of my travelling now and do all the really cool stuff now, since I will be working hard on loan repayment after I graduate in several years. I'm planning on taking no more than 1-3 years to completely pay off my student debt rather than make "small payments" every month for 20 years (please correct me if I am wrong!). After graduating, I will live cheaply, at home if I can, work the highest paying job where I can work the most hours plus whatever part time and temp stuff I can find, putting the majority of my money into paying back my loans, and a portion into a savings account every month, so I have a little something saved at the end of that 1-3 year period. That way, after I get it paid off, I won't have to worry about it. Plus, I will have built a nice resume and recommendations (and savings) so that I can apply for the actual jobs/careers I dream on having. Former students, parents, etc, what do you think of my (basic outline) plan? What else can I do to pay off loans quicker? I've heard from many people to pay twice per month and to not rack up other debts. I don't have a credit card, and probably won't for a little while and I am living at home, so I'm not worried about those. I'm also working part time jobs and am putting aside a little bit of my paychecks each month to help pay off those first payments. I also plan to start paying back before the 6 month grace period is up. </p>
<p>It all depends on how much in loans you will have. If you have the max in Direct Loans only (about $28,000 total for the four years), your repayment would be about $300 a month for TEN years (not 20).</p>
<p>So…how much in loans will you have when you complete your degree?</p>
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What is your major?</p>
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<p>No…put those savings towards your unsub loans NOW…to stop them from adding interest.</p>
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<p>this is rather optimistic…you may not find a job near parents’ home. You may be dating or have a SO at that time which would likely mean working second jobs or living cheaply becomes more difficult.</p>
<p>I think it’s wonderful that you have a plan. My suggestion is to look at the repayment schedules, given what you think you will be borrowing over the 4 years. Remember that for the unsubsidized loans, the interest starts accruing as soon as the money is disbursed. But look at what you will owe upon graduation, and then 6 months for grad which is when payments have to commence and look at what the monthly amounts will be given the time period you want to take to repay the loans. </p>
<p>Yes, it can go well. It can also go differently from planned. My friend’s DD could not find full time work even at minimum wage where her parents live which is a very depressed area where the jobs that ordinarily go to high school, college students and new grads are being snatched up by the adults with families that are stuck there and desperately need some income, any income. And she could not find a job near her college or anywhere that paid enough to cover living expenses. It’s a tight, tight job market right now. You may also need to buy a car, get insurance for said car, and then there are always transportation expenses whether its upkeep and gas for a car or public transportation or paying someone else to help you out. Cell phone payments can also make a big dent in the budget., as my kids are learning. Living at home with some help from parents can definitely give you a boost while looking for that first job–none of my kids found that an appealing option, but yes, it can save money and at least you know you have a roof over your head and food for the belly, plus heat, water,elect, cable, internet. </p>