How to deal with your student loan debt
- by admin
If you’re worried about a student loan crisis and wondering what you should do about it, the answers are a bit different for every student.
Financial management and financial supply management are two of the four most common financial management skills students need to have, according to a new study from the National Association of Student Financial Advisors (NASFA).
Financial supply management and debt management are the other two.
The research from the nonprofit research group also found that students who don’t have enough financial resources to manage their own debt, and those who aren’t able to access the full range of financial products and services offered by their banks or lenders, are likely to struggle in their own student loan life.
For instance, more than 70 percent of students who are enrolled in a financial management or debt management course, or who don�t have enough income to pay for it, struggle to meet their debts.
And about half of those who haven�t had a job in six months struggle to repay their loans.
The NASFA study is part of a larger trend among American students, as the nation�s college students have become increasingly dependent on student loans for a significant portion of their monthly income.
More than $18 trillion in student loan payments are owed to students each year, according for the National Center for Education Statistics.
The report found that one-third of the debt that students carry on their student loans is debt that they can�t repay.
The average student owes $29,000, according the report.
The findings highlight how many students are burdened with student loan debts, especially if they have limited financial options.
The NASFA said that students in the top 10 percent of their family income, who are the most likely to have student loans, are among the most burdened by student loan bills.
Students at the top of the income distribution, with incomes in the highest 10 percent, are also most likely not to be able to afford a student debt repayment plan, the NASFA found.
This lack of financial options may have an effect on how students can meet their debt obligations, said Kristin Lauterbach, a student loans expert at the Center for American Progress and co-author of the report, adding that many students may not have a choice of how to pay off their student debt.
Some student loan borrowers are more likely to fall into a debt trap than others.
Lauta said that the most common types of debt for students are student loan principal, interest, and other fees.
The interest is a major source of stress on students, and many borrowers have been in that situation, Lautarbach said.
She added that many people with student loans have little idea how to properly manage their debts, and may not know what options they have to help pay for their loans without being forced to go into debt.
Students who don`t have access to a financial planner, financial supply manager, or financial education management program, or don�ts have access at all to their loan, often don�te have the ability to negotiate a debt repayment agreement, Laxarbach added.
Lauta also said that some students may need help from a loan provider to resolve debt.
Students who aren�t aware of financial planning options and who lack a financial education are more at risk of having financial problems, Lachapelle said.
For students who struggle with their finances, she said, the most important thing is to find a plan that will work for them.
Lauders say that when they struggle with financial issues, they need to seek out the help of a financial professional.
In the meantime, many students have taken matters into their own hands to try to help their debt situation, such as paying their own bills and paying their bills on time, according in the report:Debt Management TipsFor student loan professionals and student loan servicers, student debt is one of the biggest challenges they face.
In many ways, student loans are a debt of opportunity.
The fact that students can graduate from college without owing anything and pay off loans is one big advantage of going to college, said Nicole Rauch, the CEO of Student Debt Solutions, an educational debt recovery program.
However, many borrowers are unable to meet all their financial goals because they aren�ll have to pay their student loan loans in full and the interest is so high.
Rauch said she has helped students who have student loan problems find financial planning and debt repayment options through her company.
She also pointed out that students should be aware of how much their student finance debts could grow with higher interest rates.
Raucch said that student loan interest rates can range from 10 to 15 percent, depending on the loan type and the rate at which they�re refinancing the debt.
Lauders said that it can be difficult to figure out exactly what to do with a student financial debt.
There are many factors that can impact a student�s financial life, such to how much
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