Mackanomics: Student Loans


The average student loan debt balance is almost $25,000 with more than 10 percent of graduates owing more than $58,000. The cost of college is growing each year. If you are saddled with student loan debt, here are some tips that may help:

  1. Don’t ignore the debt!
  2. Read the fine print and know the repayment guidelines before you sign.
  3. Stafford loans have at least a six-month grace period.
  4. Perkins loans give nine months.
  5. Contact your lender directly if you have a privately-funded loan
  6. If you have a federal loan (other than a Perkins or Parent PLUS loan), and you are on limited income, the Income Based Repayment (IBR) plan allows you to pay based on what you earn. You can enroll in an income=based payment plan as soon as you begin paying back your loan, but you must notify your lender early. It can take 30 to 60 days for the payment to be processed. You must provide a tax return or another form of income verification.
  7. Set a goal. Put together a three-to-five-year plan. Sacrifice to make your goal AND pay extra whenever you can.
  8. Don’t purchase a new vehicle or downgrade the vehicle you were planning on purchasing and downgrade on the home you were planning on purchasing while tackling debt.
  9. Change your email and update it to your most current mailing address, especially for those who are recent graduates.
  10. Don’t wait the through the six-month grace period. Start paying back your loan immediately, if you are able. You will pay less interest and will get into a routine.
  11. Pay more than once per month if there are no payment limits on loans. Pay towards it every time you get paid and put it on automatic.
  12. Lower interest rates on your other debt.
  13. Seek out deductions. You might be able to get a deduction by setting up automatic payments. You can deduct up to $2,500 of interest paid on federal and private loans on your federal income tax return
  14. Celebrate each time you pay down a student loan with an inexpensive outing. Reward yourself!
  15. Weigh consolidation of debt: Pro: Only have to keep track of a single, lower monthly payment for all your loans. Cons: Your loan term will increase. You will miss out on some of the repayment perks of your federal loans.

Here is are a host of great resources that will you help you manage your student loan debt.:

  • will help you put together a free payment plan for your loans.
  • and Studentloanhero will help determine how much interest you will accrue in a deferment.
  • StudentAid.Ed.Gov will give you information on lenders that manage certain loans and tips on consolidating your loan.

Ryan Mack is President of Optimum Capital Management, LLC

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