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Student loans are a hot topic of conversation these days. Students and graduates are leaving school with larger amounts of debt. Despite the scary statistics blaring across our screens on an almost daily basis, the majority of borrowers are making payments. For many, trouble comes a few years out of school, when life and loans collide.

I was speaking with a new lawyer yesterday. She was married with a two-year-old and had a mountain of student loans to go with her shiny new Juris Doctorate. Risa is also a member of the Army National Guard.  For Risa and her husband, the struggle to make payments began when they started paying day care costs for their daughter. 

When I sat down with Risa, she was very clear about what she wanted. “I just need someone to help me get a handle on this. I don’t need to be sold a mutual fund.” Risa was looking for someone who could help her take all the pieces of her life and solve the financial planning puzzle. She wanted to accelerate the repayment of her loans, maximize the benefit of her very flexible work schedule, and build her family.

Step 1:

Look at the big picture, not just your student loans. What else is going on in your life? Do you have other debts to repay too? One of the best tools around for comparing private student loan repayment strategies is is a free tool created by the Utah State University Cooperative Extension. works well with all non-federal student loan debt. This calculator helps you compare different repayment strategies and how much money and time you can save. Should you start repaying the debt with the highest interest rate or the lowest balance first? The only true answer is that it depends. It depends on more than just the math and interest rate efficiency. It depends on your unique life situation.

Federal student loans come with unique repayment plan options, benefits, and strategies. One of my favorite free calculators to use can be found at Student Loan Planner. Always think about any repayment strategy in the bigger context of your unique life circumstances.

Step 2:

Ready or not, it is time to start budgeting. When it comes to getting your finances under control and figuring out exactly how much extra you can spend on annihilating those student loans, you need three budgets, not one. Three. First, go ahead and create a monthly budget. This is what most of us are familiar with and attempt to do in our heads. We “remember” our payment due dates and “estimate” the balance in the account. Get out of your head and onto paper, excel, an app or some concrete form. Once your monthly budget is as detailed as you can get it, create an annual budget. That is right. An annual budget. You can use some of the data from your monthly budget, but chances are you missed some things that don’t happen monthly. Scan your old credit card statements or look back through your online banking. Do what it takes to create as detailed a budget as possible.

Risa and her husband and I analyzed their budget to get an idea of exactly how much money was available for extra payments. The ultimate goal of budgeting is not simply to budget. (I budget therefore I am.) The ultimate goal of budgeting is to get a full understanding of the comings and goings of your money. In the end, it turned out that Risa and her husband had an extra $500.00 per month to apply to her student loans.

Step 3:

Consolidate with caution. Federal student loans and private student loans are two very different debts. In many instances, private student loans carry variable interest rates, have less flexible repayment options, and offer fewer benefits to the borrower. Federal student loans, on the other hand, may have slightly higher fixed rates, offer various repayment plans and programs, may offer loan forgiveness programs, and provide more protections to the borrower.

Deciding to refinance your student loans begins with taking time to be sure you understand exactly what type of student loans you have, the interest rate, the payments and any possible forgiveness options. Before you make any changes, understand all of your options and the consequences of the consolidation loan you are considering.

Step 4:

Consider all the possibilities. Brainstorm what is possible. Make sure take full advantage of this activity. Brainstorming begins with allowing participants to make any and all suggestions without editing them during the process. You can’t dream big at the same time you are critiquing your dreams.  What could you do in the next year? Five years? 10 years? What could you do to conquer your debt and build the life of your dreams?

Student loan debt, and any debt, can feel overwhelming. Finding objective information is critical. If you don’t understand your student loan repayment options, start with visiting and How to Repay Your Loans. Repaying student debt is a marathon of a project, not a sprint. And like any marathon, you will need a support team along the way, cheering you on, keeping you from getting lost, and warning you about hazards along the route.

If you have questions on how you can best position your finances to deal with student loans, schedule an appointment. Together we can get you where you want to be.

Adrienne Ross is a fee-only, fiduciary financial planner serving clients
in Spokane, Washington and across the country. She is the owner and
founder of Clear Insight Financial Planning, LLC. Adrienne believes
everyone deserves a trusted financial advisor, one that puts the
client’s best interests first. She provides solution-focused,
client-centered financial planning. Adrienne has spent 15 years honing
her craft and is eager to help clients take the next step to financial

About the Author:

A fee-only financial planner with the heart and soul of a counselor.I am a fee-only, fiduciary financial planner helping military, veterans, and their families both locally in Spokane, Washington and across the country.

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