What student borrowers would change if they went back to college

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It’s easy to regret your college years, especially when graduation leaves you with tens of thousands of dollars in student loans. Yet a recent survey found that the majority of student borrowers, in hindsight, would have gone on to higher education anyway.

According to Bankrate student loan surveymore than half (59%) of adult respondents with student loans said they would still have gone to college, but would have done something different to reduce the amount of their debt, such as asking for more scholarships (23%), work or work more while in school (20%), get a degree in a different field (19%), attend a less expensive school (17%), attend a community college (15 %) or did something else differently (5%).

It’s likely that those with a college degree – even if it still costs them years later – have found that it opens the door to job opportunities and higher earning potential. According to 2021 data from the United States Bureau of Labor Statistics, adults 25 and older with a high school diploma but no college experience earned an average of $809 per week, while those with a bachelor’s degree earned an average of $1,334 per week (earnings shown are for full-time employees). This equates to a difference of $27,300 in annual salaries, which is a considerable amount.

If you’re one of the millions burdened with student debt, here’s what you can do to manage it.

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If you have federal student loans

Federal borrowers can still take advantage of the two-year payment and interest freeze and recently extended through August 31, 2022. Depending on your financial situation, you can either make the most of the relief while it lasts or use this time to reduce your student debt.

If you’re feeling strapped for cash, focus on paying your priority bills instead, as your student loans are currently interest-free. If you don’t have enough emergency funds set aside, now is the time to put some money aside in a high-yield savings account like the Ally Online Savings Accountwhich offers a higher than average interest rate.

Ally Bank Online Savings Account

Ally Bank is a member of the FDIC.

  • Annual Percentage Yield (APY)

  • The minimum balance

  • Monthly fee

    No monthly maintenance fees

  • Maximum transactions

    Up to 6 free withdrawals or transfers per statement cycle *Cycle withdrawal limit of 6/instructions is waived during the Coronavirus outbreak under Regulation D

  • Excessive transaction fees

  • Overdraft fees

  • Offer a current account?

  • Offer an ATM card?

    Yes, if you have an Ally current account

For those whose priority bills and emergency fund are taken care of, it’s worth making payments on your federal student loans even if the break lingers. With interest also suspended at 0%, payments will be made directly from your principal so you can reduce it faster than if you were paying on a balance earning interest. Also, when the forbearance period ends and payments and interest resume, then you will have a smaller balance that will earn less interest.

Once the payment and interest freeze on federal student loans is lifted, know that there are still income-oriented repayment plans that can help you if you feel drowning in debt and can’t. to follow. These plans recalculate your monthly bill based on any changes in your income, so your student loan payment reflects the amount you can afford to pay. Two specific plans, Pay as you earn (PAYE) and Pay As You Earn Reviewwill even cap your federal student loan payment at 10% of your Discretionary Income and after the repayment period ends, any remaining balance will be forfeited.

If you have private student loans

Private student borrowers may consider refinance to get a lower interest rate than they are currently paying on their debt. With refinancing, you can also choose a longer or shorter repayment term, depending on how quickly you want to pay off your loans and how much you can afford in monthly installments. For example, a shorter payment term will help you get out of debt faster, but it means making higher payments each month.

Lenders love SoFi, CommonBond and Serious have a wide selection of loan terms and interest rates to choose from. They also charge no application or set-up fees, have no prepayment penalties, and offer flexible repayment terms, hardship payment options, and autopay interest rate discounts.

SoFi Student Loan Refinance

  • Cost

    No origination fees to refinance

  • Eligible loans

    Federal, private, graduate and undergraduate loans, Parent PLUS loans, medical and dental residency loans

  • Types of loan

  • Variable rates (APR)

    From 2.24%; from 2.37% for resident doctors/dentists (rates include automatic payment reduction of 0.25%)

  • Fixed rates (APR)

    From 2.99%; from 3.12% for resident doctors/dentists (rates include automatic payment reduction of 0.25%)

  • Loan conditions

  • Loan amounts

    From $5,000; more than $10,000 for residential medical/dental loans

  • Minimum credit score

  • Minimum income

  • Authorize a co-signer

Besides, CommonBond offers a co-signer release option after 24 consecutive on-time monthly loan principal and interest payments, which acts as an incentive if you need a parent or guardian to co-sign the loan in order to take it on. Serious also allows applicants with a fair credit score to qualify.

If you’re considering refinancing your private student loans, it pays to act quickly. With the recent rise in interest rates – and the promise of more to come – borrowing money is only going to cost more.

CommonBond Student Loan Refinance

  • Cost

    No origination fees to refinance

  • Eligible loans

    Federal, Private, Graduate, and Undergraduate Loans, Previously Consolidated Loans, Corporate Sponsored Student Loans, and International Student Loans

  • Types of loan

  • Variable rates (APR)

    4.44% – 8.09% APR (rates include 0.25% autopay discount)

  • Fixed rates (APR)

    4.49% – 7.74% APR (rates include 0.25% autopay rebate)

  • Loan conditions

  • Loan amounts

  • Minimum credit score

  • Minimum income

  • Authorize a co-signer

Serious student loan refinancing

  • Cost

    No origination fees to refinance

  • Eligible loans

    Federal, Private, Graduate, and Undergraduate Loans

  • Types of loan

  • Variable rates (APR)

    From 1.99% (rates include 0.25% autopay discount)

  • Fixed rates (APR)

    From 2.98% (rates include a 0.25% automatic payment discount)

  • Loan conditions

    Flexible terms between 5 and 20 years

  • Loan amounts

    A minimum of $5,000, up to $500,000 (California residents must apply for a refinance of $10,000 or more)

  • Minimum credit score

  • Minimum income

  • Authorize a co-signer

Editorial note: Any opinions, analyses, criticisms or recommendations expressed in this article are those of Select’s editorial staff only and have not been reviewed, endorsed or otherwise endorsed by any third party.


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