Understanding Student Loans: Borrow Wisely and Qualify for Forgiveness Programs
Navigating student loans can be challenging. This guide helps you borrow responsibly, emphasizing the importance of service commitments and qualifying for loan forgiveness options. Learn about eligible loans including the Direct Loan Program and how to make qualifying payments while working in public service jobs. Find tips on budgeting, borrowing only what you need, and strategies to track your spending. Access valuable resources for medical students and discover ways to save on education costs. Make informed decisions about your financial future.
Understanding Student Loans: Borrow Wisely and Qualify for Forgiveness Programs
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Presentation Transcript
Borrowing Wisely September 8, 2010
Borrow Nothing At All • Consider a Service Commitment • Military Options • National Health Service Corp • Loan Repayment/Forgiveness Options • State and federal programs database…… www.aamc.org\stloan
Borrow But Have It Forgiven Eligible Loans + Qualifying Payments + Qualifying Work ______________________ Public Service Loan Forgiveness
PSLF - Eligible Loans • Any non-defaulted loan made under the Direct Loan Program • Subsidized • Unsubsidized • Graduate PLUS • Consolidated Loans • Perkins loans are NOT eligible* • Private loans are NOTeligible period *could consolidate with Direct Loans to become eligible
PSLF - Qualifying Payments • Make 120 on-time monthly payments in one of the following plans: • Standard • Income Contingent • Income Based (most affordable) • Payments must be made while simultaneously working in Public Service • Does not have to be continuous service
PSLF - Qualifying Work • Employed full-time (30 hours) in a public service job • Non-profit, tax exempt, 501(c)(3) organizations • Government • Military Service • Public Schools and Colleges • Most medical schools and teaching hospitals • Search online: http://www.irs.gov/app/pub-78/ • Can work in more than one job
Borrow the Best Loans First • Borrow all the unsubsidized loans first before borrowing a Graduate PLUS • Borrow the summer unsubsidized loan and save it for the next year (so you may not have to borrow a Grad PLUS) • Interested in Primary Care? Ask about a special loan during your fourth year.
Borrow Only What You Need • Create a spending plan • Track spending for a month or two to figure what you actually need to live on • Borrow in small increments • Tuition plus two months of living expenses • Ask for additional loans later • You can returned unused funds at the end of the semester
Borrow Less • Borrowing $5,000 less per year will….. • Reduce your monthly payment by $400 • Reduce total loan cost by $39,000 • Reduce repayment term by 2 years
$1860 per month $1360 per month (-$500) Incentive drawing! Track your spending this fall, send me your budgets with a few tips on how you SAVED money, and you’ll be entered into a drawing for a $50 gift card! Budgeting Examples
Track Your Borrowing • Use the Medloans Organizer and Calculator http://www.aamc.org/programs/first/ • Organize and keep track of your loans • Develop repayment strategies • Specifically designed for medical students
Resources • FIRST Facts: http://www.aamc.org/programs/first/students/factsheets.htm • Practical Money Skills: http://www.practicalmoneyskills.com/ • You Can Deal With It: http://www.youcandealwithit.com/ • Money Matters – MU Extension: http://missourifamilies.org/money/
Next Up Saving and Investing Office for Financial Success November 10th
