September 20, 2022
Now is the time to start thinking about student loan payments
It’s time to start thinking about the end of the year. No, not the exciting things like Hanukkah, Christmas or Kwanzaa. We’re talking about student loan payments. In January, millions of Americans will have to resume paying their federal student loans. If you’re one of them, now is the time to start preparing.
The federal student loan forbearance that was put in place during the early years of the pandemic officially ends on December 31. That means starting January 1, 2023, your loan payments are back. Are you ready for that? Here are some steps to take to make sure you are.
Find Out. It’s been almost three years since you last made a loan payment, so chances are you’ve forgotten how much you pay each month. Go to your loan servicer and find out exactly what you’ll owe.
Budget It. Once you know the amount you’ll be shelling out each month, try to fit that into your current budget. If it doesn’t fit, make some changes. Cut back on things like subscription costs and funnel that extra money to your monthly loan payments.
Start Now. If you can, start making payments on your loan now. As USA Today notes, the forbearance includes 0 percent interest, so any payments you make will be toward the principal. Payments you make now might end up cutting down the length of your loan.
Go High. If you have multiple loans, pay down the one with the highest interest first while making the minimum payments on the others.
Written by Chris O’Shea, September 15, 2022.