As the most resident-friendly student housing in College Station, we think it’s our responsibility at 2500 Central Park to prepare you for the future. Unfortunately, many of today’s students have a whole lot of student loan payments ahead of them. Here are some tips for soon-to-be-graduates who are staring down some serious loans.
- Just do it. Talk to your parents about money.
There are few people in your life right now who understand finances better than your parents. Let’s be honest, your college friends probably don’t really know what they’re talking about when it comes to interest rates and loan consolidation. The only downside to talking to your parents is, well, talking to your parents. It’s no secret that financial conversations with your parents can be kind of awkward. No one likes to borrow too much money from Mom and Dad, but you’ll have plenty of time to pay your parents back after you join the workforce.
Even if you don’t think you’ll have to borrow money from your parents, it’s good to sit down and talk to them about their expectations for your financial independence. Maybe they’re willing to help you pay for your College Station apartments, your post-grad housing, or your first car. You’ll never know until you talk to them about it.
Your parents can also help you keep track of your budget. Like it or not, your parents know more about money than you do at this point in your life. They’ve been adulting since before “adulting” was even been a phrase that people used. So, have a chat with your parents about money. If nothing else, they’ll surely be able to offer some sound financial advice.
- Understand Consolidating and Refinancing
If you’ve taken out loans to pay for college, you’ve likely taken out a different loan for each semester that you had to pay tuition. All consolidating does is combine all each semester’s loans into one single loan. It’s a lot easier to make one payment each month to the consolidated loan amount than it is to make multiple payments to various loan amounts. Consolidating your loans also gives you one interest rate to deal with instead of a bunch of different rates. You don’t have to consolidate your loans until you graduate and start paying them back, but it’s important to understand what the word means nonetheless.
Refinancing your loans means you change the date that they’re due to be paid back. Many government loans have a 10 year repayment plan, but that means your monthly payments will be higher than they would be on a 20 year repayment plan. By refinancing your loans, you can lower the amount you pay each month. Watch out though, because this could end up increasing the total amount that you pay over time.
- Know exactly what you owe
You’re probably going to be surprised to find out the exact amount of money that you owe the government; most people are. It’s just not something that students have time to think about between class, work and a social life. But make no mistake, it’s important to face reality at some point and identify exactly how much money you have borrowed and have to pay back.
- Budget out your lifestyle with loans
Once you know how much you owe on your repayment plan, you can figure out your monthly payments. Now it’s time to set a budget. You should understand that your paycheck is going to be impacted by your student loans. Even if you get a high salary right out of college, it’s not going to end up being quite as much money as it seems once the government has taken its chunk.
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