Student Loans 101

You put in the work, spent the time and earned a college degree. What’s next? Paying off those student loans. The weight of student loans can be daunting, but there are programs available to assist paying them off.

A Standard Plan involves fixed payments that will ensure the loan is paid off within ten years. A Graduated Repayment Plan starts with small payments that gradually increase, typically every two years, to complete the loan payment within ten years. The Extended Repayment Plan is more flexible. It can be either fixed or graduated and will have the loan paid off in 25 years.

Other options include a Pay As You Earn Repayment Plan (PAYE), the Income-Based Repayment Plan (IBR), the Income-Contingent Repayment Plan (ICR) and the Income-Sensitive Repayment Plan. Eligibility for these plans varies based on amount of loans, income and more. A Direct Consolidated Loan is a good option if multiple federal education loans have been accumulated. It allows the consolidation of the individual loans into a single loan—meaning one monthly payment instead of multiple payments. One more option is available through employment when companies offer to contribute a dollar amount per year to an employee’s student loans.

Though the load may seem heavy, options are available to provide aid. Find out which one works best for you. Wondering how COVID-19 might affect your loans? Click here to learn more.

Content created by Lockton Dunning Benefits with info from www.debt.org/students/student-loan-repayment-benefit/ and https://studentaid.gov/