Monthly Archives: October 2013

Manage Student Loans

Three Rules for Managing Student Loans Smartly

Whatever the expenditures are for, if you overspend, you’ll over-borrow. Unless you’re managing ALL your money wisely, you may indirectly be mismanaging your student loans, which will impact your lifestyle for years while you pay them off.

 

                                Borrow Only What You Need, Only When You Need It

Remember: the amount you borrowed is not the  amount you’ll have to repay.  By the time you finish paying off your student loans, you’ll probably end up paying around 30% more (in interest) than the amount you borrowed (depending on how many years you take to pay the loans off). If you don’t plan for this, your student loan payments may be much larger than you expected and take a bigger chunk out of your paycheck than you’re prepared to pay.

 

    1. When Calculating How Much Student Loan Money You’ll Need, Ask Yourself These QuestionsCan I reduce my expenses (the answer is almost always yes)?
      Can I work more during the school year without jeopardizing my grades?
      Can I work more during the summer or find a higher-paying job?

Keep track of what you owe in student loans and use an online calculator to estimate what your payments will be at today’s interest rates (while keeping in mind that rates could continue to go up).

 

  1. Use Your Student Loan Money to Finance Your Education, Not Your LifestyleMany college students honestly believe they are managing their student loans well. They keep the money separate from their other funds and use it only for tuition, books, and fees. In reality, many students who do exactly that are actually NOT using their student loans wisely. Why? Because when you’re in college, unless someone else is footing your entire bill, every dollar you spend unnecessarily will be a dollar you’ll have to borrow later, which means another dollar plus interest you’ll have to repay. If you could have used some of your own money for tuition and books, you wouldn’t have to borrow as much.

Loans

Remember those loans you took out to help pay for school? The six months of your grace period gave you the time you need to make sure you know how many Federal Stafford Loans you have, what your monthly payment amount will be, where to mail your payment, and when to start paying the loans back.

When it’s time to make payments on your loans, you will work with one or more loan servicers. See if you have loans with servicers besides Nelnet by logging in to nslds.ed.gov. You’ll need your PIN.

For loans serviced by Nelnet, you can view all of your loan details by logging in to Nelnet.com. We’ll also send your monthly student loan billing statement around three weeks before your payment is due.

What to Do and Expect While You’re In Grace

  • Log in to Nelnet.com to update your contact information, see your due dates and payment amounts, and view other loan details.
  • About halfway through grace, when you log in to Nelnet.com, the Payment Schedule for your student loans with Nelnet will be available in the left hand navigation under Payment Schedule.
  • Explore your repayment plan options—if you don’t choose a specific repayment plan during your grace period, your loans will be on the Standard Repayment Plan, but you can change your repayment plan to better fit your budget at any time.
  • See if you have loans with other servicers at nslds.ed.gov. You’ll need your PIN.
  • Review your Nelnet student loan billing statement. It arrives about three weeks before your first payment is due. You can choose to receive paper or eStatements by logging in to your account at  Nelnet.com. See a sample Nelnet statement.

Things to Keep in Mind While in Grace

Special Considerations for PLUS and GradPLUS Loans

For Federal GradPLUS Loans for graduate and professionals students, your payments are postponed until six months after you graduate or drop below half-time status as a student. This postponement is called a six-month deferment, not a grace period.

Federal PLUS Loans for parents don’t have a grace period, and you’ll begin making payments approximately 60 days after the school(s) receives all of the loan funds. However, you can postpone payments while you or your student is in school—but the loan will continue to accrue interest. If you haven’t yet pursued this option, you can request this postponement (called a Parent PLUS Borrower Deferment) directly from us by calling 888.486.4722.

For both of these loan types, we’ll send your monthly student loan billing statement around three weeks before your payment is due. When you start making payments, your loan is considered to be in repayment.

Please log in to Nelnet.com to view when payments are due for these and any other kind of federal student loans that are serviced by Nelnet.

Get Ahead on Payments

Some borrowers choose to start making payments before their grace period ends. You will save money if you make payments on your student loans while in grace—this will lower your overall balance and maybe even shorten your loan term.

Consolidation, Repayment Plans, and Options to Postpone Payments

If you have federal student loans through multiple lenders, consider consolidating them into one loan so that you only have one monthly payment rather than multiple.

Nelnet also offers various repayment plans that could potentially spread your payments over a longer period of time or lower them based on various criteria.

If you don’t think you’ll be able to start repaying your loans, consider deferment or forbearance.

Military Options

If you’ve been called to active duty military service, you may qualify for a grace period of up to three years. If you return to school following the military service, you may qualify for additional grace time as well. If you’re unsure whether you are in your grace period or repayment, contact us

TEN THINGS AMERICANS WASTE MONEY ON

10 Things Americans Waste Money On
We don’t think much about our daily money-wasters . . . but we need to. There are so many places in our daily routine where money can be wasted without us knowing it. It’s ridiculous enough to make a list over—so we did. Here are 10 things we waste money on in America today:
1. Credit card interest
The only thing stupider than buying something you can’t afford is buying something you can’t afford at (insert huge interest rate here). You don’t get jack for the extra money you fork over.
2. Deal websites
Hey, remember that time we bought a laser hair-removal deal for 78% off from that startup place all the way across town and used it for the full amount and within the specified time limit? Neither do we.
3. Appetizers
Restaurants already have lunch and dinner portions so big you need a box to bring home the leftovers. Why pay an extra six bucks to get something that will take up more room in your stomach before the main meal is even brought out?
4. ATM fees
When we use a bank that is not ours, it charges us. Then our bank charges us again. Don’t think that it’s just two bucks here or $3 there. It adds up, and don’t even get us started on the overdraft fees that could result from bounced checks. Speaking of which . . .
5. Overdraft fees
For these, there’s just no excuse.If you add correctly and spend less than you make, you’ll never pay a dime of overdraft fees. Fees result from sloppiness, pure and simple.
6. Speedy shipping
Seriously? Do we think that book or those clothes we ordered online are so important that we can’t wait four to 14 days for a package to arrive? With priority shipping, the only thing that moves faster than the package toward you is your money—away from you.
7. Designer baby clothes
Also known as “glorified stain gatherers.” Why do we spend $20 on a “Feed me or no one sleeps”T-shirt that is three ticks away from being covered with breakfast? On top of that, they’ll wear it two or three times before either outgrowing it or the season changing.
8. Unused gym memberships
How is it that so many people join a health club around the New Year’s Day resolving to lose weight and there are so many empty treadmills come January 15? Unlike the commitment, the monthly dues don’t stop. Besides, you can run around the block for free.
9. Premium cable packages
Not only do we not watch 90% of the channels that are on, but with so many “reality” shows and specialized stations, TV as a concept is about as rich as a person who lives paycheck to paycheck.
10. Daily coffee trips
Back before coffee shops started popping up on every street corner, people brewed it themselves.We as a culture seem to have gotten away from that. And you don’t need the caffeine to get your heart thumping—just take a look at how much money you dish out for that sugary concoction over a month or two.
Take a look at your own budget and see where your cash might be getting away from you. It can happen easier than you think. Most often, it does.