COLORADO SPRINGS – The average college graduate has about $30,000 in student loan debt.
It’s a good chunk of change so how soon do you need to start paying it off and just how much?
Our partner at Carlson Financial explained how to manage student loans.
It’s during this time of the year when college graduation season has winded down and thousands of young people across the country are stepping into the real world.
Carl Carlson, CEO of Carlson Financial, said, “All the euphoria of graduating from college, exciting times, getting a new job or worried about getting a new job, paying the student loans is not high on your list.”
Carlson said the good news is that you don’t have to start paying off your loans until six months after graduation, but make sure you don’t forget about them.
“When that six months starts approaching oh no what am I going to do? I’m starting to get all these student loan payment bills that’s saying what the payment’s going to be and now it kind of starts to set in.”
He said you’ll want to knock out your unsubsidized loans first because the interest rates are higher.
When it comes to the amount you should pay each month Carlson said, “I would say starting out just pay the minimum until you figure out what your cash flow looks like.”
Especially if you have other expenses or debt.
“If you had to buy a car now you have a car payment…house payment or that rent, so many things are changing…if you have credit card debt or something like that and the interest rates are higher on that pay that off first.”
No matter what route you go or how much you pay Carlson’s other big piece of advice is to stay organized. Carefully track all your student loans and watch that big number start to decrease.
Carlson said there are federal programs available to defer payments if you’re not making a lot of money. Income-driven programs will stretch out the payment schedule to 20 years and if you still owe money by then the loans will actually be forgiven.
Carlson Financial is a sponsor of Financial Focus.