Tag Archives: student loans

5 Steps Towards Tackling Your Student Loans

student

Whether you’re a current college student or have graduated and are ready to get rid of your debt, there’s no better time than now to start paying off your loans. It’s not an easy job, but the feeling and relief of being debt-free is unlike any other. Keep reading to learn the five steps to take towards getting rid of your student loans. 

1. Pay more than the minimum 

No matter how small the amount of added money each month is, paying more than the minimum is one of the best ways to drastically reduce your debt faster. Even if the most you can afford to stack on is $15, it will add up and you’ll be glad you did it.  

2. Create a debt payment plan 

Making a plan will not only help you stay on track, but it will make you feel better and more motivated to reach your goals. Map out how much you make each month, what expenses you have, how much you have to pay off in student loans and make a plan with a timeline. 

3. Set up a tight budget 

Living the cheap college life doesn’t always get to end once you graduate. The tighter your budget is, the faster you can tackle those student loans. Analyze your current budget and make adjustments, remembering that student loans are temporary and this is a short-term budget. 

4. Pick up a side gig 

Maybe you have free time on weekends, allowing you to pick up a serving job at a restaurant. If you don’t have that time, it could be as simple as selling your used clothes or making a business out of your hobby. Whatever your side gig ends up being, be sure to put the money you make directly towards your student loans to pay them off faster. 

5. Make automatic payments 

One of the best ways to make sure you’re paying enough every month is to set up autopay. Not only does having the money taken directly out of your account each month hold you accountable for paying, but it also allows you to just work and not worry about how much to pay and when to pay it. 

This time period of being in debt is just temporary – if you start paying now and work hard, you can get rid of debt sooner than you expect. We hope you give these tips a try and that they will help you tackle your student loans quickly so you can live a loan-free life! 

How to Tackle Student Loan Repayments

What they didn’t teach you in school, was how to pay for school. Many know what it’s like to look excitably into your direct deposit account or open that envelope on payday to only be dissatisfied by the large withdrawal that was taken towards your student loan debt.

Confronting what seems like the impregnable wall of debt can be overwhelming. And many can feel unprepared – even duped at the debt to income ratio their college degree has given them. However, it doesn’t have to be this way forever. By changing your strategy and perspective on your educational investment, you can eliminate your monthly payments at an accelerated rate. Learning to tackle debt in the right way will become muscle memory for future financial discipline.

Choose the Right Repayment Plan

Americans owe 1.45 Trillion in student loan debt, spread out among 44 million people. While this may seem counterintuitive, choosing the right plan for your income can make a large difference in how much you pay over time. 85 percent of student loans are either: Stafford, Perkins, PLUS, & Direct Consolidated. They have 5 repayment options, with the lowest minimum payment starting at $50 for ten years, to the income based plan that takes a “fair” percentage of your salary (decided by the Federal Government) and forgives any debt left after 25 years.

Although it’s tempting to pick whatever has the lowest monthly payment, it isn’t the wisest. How much you pay and on what terms can seriously impact future investments like a home or being able to put enough away for retirement. Try to pay 10% of your gross (pre-tax) income towards your debt. By biting the bullet now, you will give yourself freedom in the future.

Scrap for Savings

There are some basic practices you can implement to prevent being delinquent on payments. One of those is consolidating your Federal loans. This won’t initially save you on interest, but it will help to relieve you from the headache of keeping track of many different loans. Having them all in one place with one simple payment will enable you to stay on track. Second, sign up for automatic withdrawals from your checking account. Doing so will cut your interest rate by .25 percent. If you would like to establish a college fund repayment account, contact one of our loan specialists at Heartland Bank to help.

Keep Your Eye on the Prize

The average student loan monthly payment is $351 a month, and we recommend you paying more than that if you can fit it into your budget. The most important thing you can do is to not fall off the wagon when it comes to tackling your debt. Stay focused on the goal set before you. The impulse purchases and comforts of the present are alluring, but ridding yourself of a financial burden is more rewarding. The more you take hold of your debt, the sooner it will be conquered.

Student Loan PSA: What Student Debt Really Looks Like

Student Debt

Obtaining your secondary education can be a landmark goal on your journey to success. By opening up opportunities, and enhancing your capabilities, the study of discipline gives you the skills you need to conquer your future ambitions. More often than not, student loans offer a helpful supplement when financing this experience. However, many students are able to obtain these financial aids without having to budget or offer a credit history, causing a higher likelihood of default among student borrowers. To help avoid this, Heartland Bank suggests answering the following questions before choosing how to pay for your collegiate participation:

 

What are you starting with?

The first question you should ask yourself is, ‘What money do I have to begin my education?’ If you have applied for and received scholarships, those should first count towards tuition and books. Additionally, if you have any financial support from relatives, these funds may be allocated best at the base of your budget during your college planning. By totaling the sum of these two amounts, you can determine the support outside your own savings that will be contributed towards your future learning efforts. Knowing whether or not this amount will be offered on a recurring basis can help you then decide what financial steps you need to take in order to save, earn, and/or borrow the remaining funds necessary.

 

How much and how often can you contribute?

After learning your total amount of support, it is now possible to create a plan of action to facilitate the rest. Depending on your length and type of education, your costs may vary drastically. When selecting both a field and institution of study, the factor of price is an important one to consider. By thinking of your education as an investment, you can ensure that you choose both a rewarding and promising career path to help you repay any debt you do incur during this time. To help decrease overall expenditures, many students take on a part-time job to supplement the costs of their education, along with the associated room and board. Utilizing this choice can decrease the overall amount of your anticipated loan, and help you avoid the additional expense of interest. Should the cost your education still be more than you can currently cover, the option of a student loan may be a viable solution.

 

What is student debt?

While obtaining an education has potential and opportunities, the accompanying debt can often be overbearing. In order to minimize this, we recommend borrowing only the minimum amount needed. By opting for a lesser sum, you are able to save your future-self hundreds or thousands of dollars on interest alone. For example, the average debt for a student is approximately $37,172. With borrowers averaging ten years for repayment, the potential cost of interest alone can add up to over $9,000.

 

Choosing the best option to finance your education can affect your life well past college. To help you make the most informed decisions, our team at Heartland Bank offers sound financial advice and information. To learn more, stop by one of our locations, we’d love to get to know you and your education aspirations.

Repaying Student Loans

student-debt-blogOver 40 million Americans utilize student loans. Across the country that adds up to be over 7 billion dollars in national debt, second only to mortgages. Take another look into your finances with these student loan tips courtesy of Heartland Bank!

  • Choose your loans wisely: Calculate the cost of the necessities – tuition, room and board, textbooks, and transportation – and sign loans that cover only what you need, even if you qualify for more. A part-time job or summer position can provide funds for added nonessential expenses. Your loan might allow you to defer interest payments while you’re still in school. However, unless it’s subsidized, it will accrue interest immediately. Unpaid interest then compounds and adds to the principal, creating an even larger amount to repay.
  • Increase your payments: If you’re on a 10-year installment plan, you’re paying a decade of interest on top of your original loan, adding more debt to your plate. When possible, pay back more than the minimum agreement each month and chop off extra time and interest. If you have multiple loans, direct your additional payments towards the loan with the highest interest rate. The faster you can pare down the principal, the less you accrue in exorbitant interest.
  • Make installments as often as you are able: With less time between payments for interest to accumulate, an accelerated payment plan can decrease your repayment term. By doubling your schedule of installments and making more payments over the same time period, you’re able to lessen the interest and pay your loan off sooner.
  • Track your interest: Motivate yourself with a continually updated track record of your current interest. The longer you have the loan, the more money you spend towards interest. Incentivize yourself by creating a cap for how much you want to pay in interest per year. Let that help guide you to make extra payments per year.

If you have questions on your student loan payments, or choosing the right option for your future education, call (866) 420-2800 or stop by today!

Student Loan Preparation

Preparing for student loans can help you understand your loans and to make timely payments.

Preparing for student loans can help you better understand your loans and to make timely payments.

Back in May, you graduated from college. This is one of life’s biggest accomplishments, but it also comes with a lot of responsibility. The responsibility includes: managing a fulltime job, living in a new place and paying off student loans. November is right around the corner, when your student loan grace period ends and your payments begin. Today’s Heartland Bank blog is about preparing to pay off your student loans.

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