Get Rid of Student Loans Starting NOW!

I was never a fan of handing over those yellow paper dollars to my opponent because I landed on his piece of property on Illinois Ave. Just like handing over those fake paper dollars in Monopoly, paying off student loans will feel the same way. But in the game of Monopoly, it does feel better when I make an investment by buying a piece of property. And paying off student loans should feel like making an investment in Monopoly. Though at first all you see is money being taken from your bank account, later you will see the results when people start paying you for landing on your square… Or rather when your student loans diminish. There are positives to making those monthly payments. The burden is being relieved.

Photo by Mikael Miettinen

There are 4 options that can all be negotiated with your lender, whether it was a private lender before the law on private student loans changed, or whether your sole lenders are companies backed by the government. After graduation there will be a 6-9 month grace period where graduates will not have to pay off student loans, so they have time to look for a job (so they can afford the payments). Unless the graduate is in forbearance with their lender, which allows more of a grace period, he or she will start paying off loans with an amount that is negotiated with the lender. The minimum is usually about $50. Graduates are able to switch their payments to larger payments monthly. The most important thing is to stay on the same page with the lender.

Graduates who have found a well-paying job soon after graduation will start paying off loans in the form of standard payment. This is the best option because loans will be paid off after 10 years, and it has the best interest rate. While this is the quickest payment option, it is also requires the highest monthly payments.

This option is for graduates who have found a job that starts off with a decent wage that will steadily increase over time. The loan payments will start off by mirroring the small wage and over the next couple of years for the next 10-30 years the payments will increase like the graduate’s wage.

This payment option is set up so that monthly payments will be based off of what the graduate is making in their current income. This is for those who have seasonal jobs, or jobs that fluctuate with seasons. With this option, graduates will have 15 years to pay off their loans.

This payment plan has the worst interest rate, because the payer has chosen to pay the least amount per month. This means that by the end of the 30 years it takes to pay off the loan, the loan payer will have paid almost double than they initially borrowed.

If you have questions about any of these options, contact your lender. Or ask your mother, she usually knows.

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