What are the best strategies for managing student loans?

Federal student loans have much lower interest rates compared to private loans, often half or even a third the rate.

Income-driven repayment plans for federal loans can lower monthly payments to as little as 10% of a borrower's discretionary income.

The Biden administration's student debt relief plan forgives up to $20,000 in federal student loans for eligible borrowers, a historic move.

Consolidating multiple federal loans into a single Direct Consolidation Loan can simplify repayment and potentially lower interest rates.

Public Service Loan Forgiveness (PSLF) program can completely forgive federal student loans for those who work full-time in qualifying public service jobs.

Deferment and forbearance options allow borrowers to temporarily postpone or reduce federal student loan payments during hardship.

Making even small additional payments towards the principal of federal student loans can significantly reduce the total interest paid over the life of the loan.

Applying for loan forgiveness or income-driven repayment plans must be done proactively, as they do not happen automatically.

Private student loan interest rates are negotiable and can be reduced by improving credit scores or securing a cosigner.

Defaulting on federal student loans can lead to wage garnishment, tax refund seizure, and long-term damage to credit scores.

The COVID-19 student loan payment pause is set to end in 2024, requiring borrowers to resume regular payments.

Repaying student loans through automated monthly payments can help avoid late fees and delinquency.

Refinancing federal student loans with a private lender may lower interest rates but results in the loss of key protections like income-driven repayment plans.

The FAFSA form, required for federal aid, must be completed annually to maintain eligibility for grants, loans, and work-study programs.

Employer-sponsored student loan repayment assistance programs can provide an additional source of funding to help pay down debt.

Student loan servicers are required by law to provide clear information about repayment options, but borrowers must proactively communicate with them.

Attending a more affordable in-state public university can significantly reduce the total cost of a degree and student loan burden.

Taking advantage of tuition reimbursement or loan forgiveness programs for specific careers, such as teaching or public service, can help offset education costs.

Maintaining good credit is crucial for securing favorable interest rates on private student loans or when refinancing federal loans.

Borrowers should carefully review all loan documents and terms before accepting any student loan, whether federal or private.