It is often the lament of new professionals how their student loan balances are hard to pay off, or worse, that the interests on their loans seem to increase uncontrollably. Admittedly, these situations can be brought by the students upon themselves due to being irresponsible toward their finances.
Here are the top three things you should avoid as you manage your student loans:
The importance of having a budget and sticking to it can never be stressed enough. While still in school, the repayment period of your loan may seem so far away. You don’t keep track of your expenses as you feel that being in school exempts you from grown-up things like budgeting and financial planning.
This kind of attitude leads to bad spending habits that you may find hard to shake off once you graduate and need to start paying off your loans.
Unchecked credit card spending
When you graduate and start working, you may consider getting a credit card. Having one gives you a lot of convenience. It may lead you to trouble, though, if you can’t control impulse buying or don’t keep track of your expenses.
While you are still paying off your student loans, it is imperative that you don’t acquire more debt.
Unchecked credit card spending is a sure thing for you to lose control overy your budget. Since the interest in credit cards is higher, you will end up prioritizing paying for this over your student loan payments.
Not being in contact with loan providers
Keeping in touch with your loan providers doesn’t end once you have received your loan. It is important to maintain contact with them. Not informing them of your enrollment status each year will lead to your loans going into repayment even if you’re still studying.
Not informing them of changes to your personal information such as change in telephone numbers and addresses might lead to you missing any important mail from them. In the event that you find yourself having a hard time making your loan payments, avoiding contact with your loan providers will just make your problems even worse, especially if you default on your loan.