Education is hugely important. It provides us with the tools we need to thrive in life, arming us with knowledge and creativity. However, the higher levels of education come at a cost and one that should be planned for well in advance.
University fees are on the rise and often students leave full-time education with huge debts hanging over them. Despite the size of the figures involved, these student debts are manageable if you follow these tips.
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Plan while you can
Depending on where you went to university and what type of loan you took out, it’s quite likely that you have some form of grace period before you have to start paying it off. In the UK, this is based on your salary, while in the US it could be a fixed length of time. In either case, make use of this period of time to plan your student debt repayment.
Come up with a budget and personal repayment plan that looks at your income, outgoings and student loan contributions. By planning ahead you can manage your debt better once the repayments begin.
Don’t panic
One of the impacts of student debt that is less talked about is the mental burden that it creates. Just hearing the words, “you owe $20,000” for example can deter a lot of talented teenagers from attending higher education.
The important thing is to not panic when thinking about your student debt. No matter how much your course costs, you can manage your finances if you have a clear head and a clear plan. Education is the bedrock of society, so do not let money worries stop you from pursuing your dream.
Debt is not necessarily damaging
Although living with debt is not ideal, student debt is not the same as owing thousands to a loan shark. Paying off your loan doesn’t mean that you have to live off sawdust and hay for the next twenty years either, in fact you can still make the major purchases that you’ve always dreamed of.
Many organisations now view student debt in a more forgiving light than they used to and are willing to offer a number of financing options. Doctor loans, for example, are available to recently graduated medical students to help them purchase a home and other graduate professions are granted similar benefits.
Help yourself while helping others
If you’re based in the US, it is worth looking into volunteer programmes that offer “student loan forgiveness.” Although you’ll still have to pay off some of your debt, a portion may be written off or deferred. By signing up to a volunteer scheme like this, you get to help others while helping yourself to a debt-free future.
Another useful site in the UK is the Money Advice Service who offer free advice on how to deal with debts after you graduate.
Live within your means
A good tip for anyone, but particularly recently graduated students, is to live within your means. After leaving student life behind, it may be tempting to suddenly start living a more extravagant lifestyle, making the most of your real-world paycheck. However, make sure you don’t overdo it.
