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Hi i’m aaron from broke millennial for the financial diet welcome to the three minute guide brought to you by skillshare forty-four million americans collectively have over 1.5 trillion dollars of student loan debt it’s pretty much an epidemic at this point that means you need to arm yourself with all the information possible because this is such a hefty topic
We are doing a special extended episode of the 3-minute guide here is everything you need to know about student loans decode your financial aid letter properly the first aspect is understanding whether or not the money you’re receiving is a scholarship or a loan sometimes using words like award makes it sound like it’s a scholarship when in fact it’s not it’s a
Regular loan if you have any confusion about which type yours is be sure to reach out to the financial aid office at your school federal student loans are better than private if you’re watching this video before you finish taking out student loans for college then be sure to always maximize your federal student loans before turning to private federal student loans
Provide far more options in repayment than private loans to some federal student loans are even subsidized which means interest does not start accruing while you’re in school you can actually return surplus loans or your financial aid refund before you commit to all of your student loans you need to run the numbers and see if you actually do need to use every penny
You received you might be thinking wait i can give money back yes you can it’s within your rights as a borrower to cancel all or a portion of your federal student loans without triggering fees or accruing interest if you do it within a hundred and twenty days of receiving them you may also have received a financial aid refund the term refund makes it sound like it’s
Free money kind of like a tax refund but it’s not it is still alone and it’s still accruing interest if you don’t need that money because all of your base needs have already been met then it’s best to just return the refund in order to have less to be paying back after you’ve graduated how to find all your student loans most people have multiple student loans with
Different servicers so it can be a real pain to track them down federal student loans make it fairly simple with the national student loan database system which can be found at nslds dd gov all of your federal student loan information should be right there you can pull a free copy of your credit report from annual creditreport.com in order to track down private
Student loans it also doesn’t hurt to ask your parents especially if they took out some student loans for you and expect you to help them pay them back when you have to start repaying you generally don’t have to start making payments on federal student loans until six months after you’ve graduated or after you’ve dropped below halftime enrollment private student
Loans don’t always offer the same amount of time so be sure to check with each one of your providers to see how long your grace period is let’s talk about repayment options as i mentioned earlier federal student loans have far more options including the income driven repayment plans and forgiveness programs income driven repayment plans help make sure that your
Entire paycheck is not going towards your student loans and it can help provide a little bit of breathing room in your budget for month-to-month these plans cap your monthly payment at ten to twenty percent of your discretionary income the issue with these plans is that you extend the term of your loan from ten years to 20 or 25 years after two decades of making
Payments any remainder on the student loans gets forgiven forgiveness programs are generally for people working in the public sector such as nonprofit or for the government the public service loan forgiveness program for example requires you to make 10 years worth of student loan payments and at the end of that time any remainder will get forgiven you usually
Need to consolidate your federal student loans in order to make them eligible for either an income driven repayment plan or for forgiveness plan a consolidation is not the same thing as refinancing refinancing is the act of taking out a new loan to pay off an old loan i know it sounds kind of crazy but the reason you do this is because the new loan has a lower
Interest rate and therefore it could save you hundreds to thousands of dollars over the life of your loan however there is a huge catch refinancing a federal student loan turns it into a private loan which means you are no longer eligible for any of the federal programs such as income driven repayment plans and forgiveness you do not have to refinance all of your
Student loans so if you have federal and private student loans it could make sense to refinance the private and leave the federal student loans alone there are so many scams you’ve probably already gotten a robo call about a student loan debt relief program be careful there are tons of these student loans you do not i repeat you do not need to pay anyone to get
You enrolled into a federal program to help pay off your student loan debts don’t let someone swindle you into paying them money for something that you could do for free that’s money that could be going towards paying off your student loans also your servicers might not do a great job of telling you what all your repayment options are so it’s your job to do your
Homework and keep on top of all the paperwork the best way to prepare for handling your student loans is to be proactive because you probably have multiple servicers who aren’t exactly looking out for you educating yourself is the key to making a student loan repayment attack plan trying to pay off those student loans faster you and i both know the best way to do
That is to start bringing in more money one way is to up your game by using skillshare which provides an easy and affordable way to expand your talents every week we’re featuring a different skill share class we think you guys will love this week’s class is building an etsy shop that sells strategies for e-commerce success hosted by etsy content producer parkour
Guard this class will teach you the ins and outs of creating a successful e-commerce business within an online marketplace as always though skillshare offers a huge range of high-quality classes on must-know topics from writing to fitness to business and it’s all about what you want to learn at an affordable annual subscription of less than $10 a month and send
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The comment section below i’m erin from broke millennial for the financial diet and don’t forget to be here next thursday for a new three minute guide
Transcribed from video
Everything You Need To Know About Student Loans | The 3-Minute Guide By The Financial Diet
