Navigating the Restart: Smart Strategies for Student Loan Repayment

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Welcome back, diligent scholars! With the resumption of student loan payments, it’s natural to feel a mix of emotions, especially given the fact that they were on the verge of being forgiven. But fear not, we’ve got your back! In this blog post, we’ll explore some smart and efficient strategies to help you navigate the often-overwhelming world of student loan repayment. Plus, we’ll point you towards valuable resources that can make the journey a whole lot smoother.

Proactive Strategies for Student Loan Repayment:

  1. Create a Budget: Begin by understanding your monthly income and expenses. This will give you a clear picture of how much you can allocate towards your loan payments without straining your finances.  The goal here is to keep all debt payments below 36% of gross income.
  2. Explore Different Repayment Plans: Federal student loans offer a variety of repayment plans. Consider options like Income-Driven Repayment Plans that adjust your payments based on your income.
  3. Make Extra Payments: If you can, try to make additional payments towards your loans. But, don’t overdo it, as the best option is to pay off what you can afford. We would not want someone to deplete their emergency fund or go into CC debt.
  4. Automate Your Payments: Set up automatic payments to ensure you never miss a due date. Many lenders offer interest rate discounts for enrolling in automatic payments.
  5. Prioritize High-Interest Loans: If you have multiple loans, focus on paying off the ones with the highest interest rates first. This will save you money in the long run. If you have loans with 7% interest or higher, we’d recommend paying that off as soon as you can.
  6. Consider Loan Consolidation or Refinancing: This can help you streamline your payments and potentially secure a lower interest rate. However, be sure to weigh the pros and cons before making a decision.
  7. Stay in Touch with Your Loan Servicer: If you encounter any difficulties, don’t hesitate to reach out to your loan servicer. They can help you explore options like deferment or forbearance if you’re facing financial hardship.

Resources for Loan Forgiveness or Repayment:

  1. Public Service Loan Forgiveness (PSLF): If you work for a government or non-profit organization, you may be eligible for loan forgiveness after making 120 qualifying payments.
  2. Teacher Loan Forgiveness: Teachers in certain low-income schools or educational service agencies may qualify for forgiveness of up to $17,500 on certain federal loans.
  3. Income-Driven Repayment Plans (IDR): These plans cap your monthly payments based on your income and family size. After 20 or 25 years of on-time payments, any remaining balance may be forgiven.
  4. SAVE Program: This is a new form of IDR plan under the Biden Admin. This will lower almost all people compared to other IDR plans because your payments are based on a smaller portion of your adjusted gross income (AGI).
  5. Loan Forgiveness for Military Service: Members of the military may be eligible for loan forgiveness programs specific to their branch of service.
  6. Employer-Based Forgiveness Programs: Some employers offer assistance with student loan repayment as part of their benefits package. Check with your HR department to see if this is an option for you.
  7. Loan Repayment Assistance Programs (LRAPs): Some states, universities, and non-profit organizations offer assistance to individuals with student loan debt, often in exchange for working in underserved areas or fields.

GradFin: A “Hidden” Resource for Loan Forgiveness or Repayment:

If you haven’t heard about GradFin yet, well get ready! They have analyzed $5.7B+ worth of loans and have had over 60,000 consultations with borrowers since 2015. We have recommended many of our clients to them for consultation meetings. Oh, and the best part, the consultation is 100% free, so it’s worth the time to setup a call. Their expertise can potentially lead to significant savings, lower monthly payments, and a clearer path towards financial freedom.

To Wrap It Up

Paying back student loans can seem daunting, but with the right strategies and resources, you can tackle it with confidence. Remember, you’re not alone in this journey. Take proactive steps, explore forgiveness options, and don’t hesitate to seek guidance from your loan servicer, GradFin, or financial advisor. You’ve got this!

Federal Student Aid:


Jack Mancinotti
Wealth Manager & Retirement Plan Consultant