Expand Your Student Loan Knowledge
This is material I thought would be worth sharing courtesy of my Financial Planning Software Provider RightCapital. We believe it is important to be an informed consumer of college education and want people to have an education on these programs with the hope of minimizing or even avoiding take on debt to pay for college. This article includes facts and information that will help you to understand the nuances of college debt.
Federal Student Loans
Federal student loans are offered by the government, with terms and conditions that are set by law. These loan types include many beneﬁts such as a ﬁxed interest rate, income driven repayment plan options and eligibility for Public Service Loan Forgiveness (PSLF) not typically offered with private loans.
Private Student Loans
Private loans are offered by private organizations such banks, credit unions, and state- based or state-afﬁliated organizations. These loan types have terms and conditions that are set by the private lender. Private student loans are generally more expensive than federal student loans.
Below is a graph that outlines different types of student loans and categorizes them by federal and private lenders.
A loan servicer is a company that is assigned to handle federal student loan debt on the government’s behalf. The loan servicer will assist you with tasks related to your federal student loans. You can contact the loan servicer to obtain standard 10 year payment, new borrower status information or any other relevant information. If your circumstances change at any time during their repayment period, the loan servicer will be able to help. If you are unsure of your loan servicer look for the most recent communication from the entity sending bills for the loan payments.
Below is a list of loan servicer’s and their contact information. These contacts can be used to gather additional details needed for an in-depth student loan analysis.
Loan Servicer Contacting Information
Federal Student Aid Information Center (FSAIC) at 1-800-433-3243.
|FedLoan Servicing (PHEAA)||1-800-699-2908|
|Granite State – GSMR||1-888-556-0022|
|Great Lakes Educational Loan Services, Inc.||1-800-236-4300|
Loan Servicer Contact
1-800-621-3115 (TTY: 1-877-825-9923 for the deaf or hard of hearing)
Student Loan Repayment Plans
Student Loans can be repaid in a variety of different methods depending on the your situation. The different plans may seem similar, but each has distinct pros and cons. Note that if you didn’t choose a repayment plan, the loan servicer will automatically place you on the Standard Repayment Plan.
Income-driven repayment (IDR) plans are designed to make student loan debt more manageable by reducing the monthly payment amount. If you need to make lower monthly payments or if your outstanding federal student loan debt represents a signiﬁcant portion of your annual income, one of the following income-driven plans can be used. After 20 to 25 years of steady repayment, the remaining balance is forgiven
Income Driven Repayment Plan
REPAYE Generally 10% of discretionary income
PAYE Generally 10% of discretionary income
IBR Generally 10% of discretionary income if you’re a new borrower on or after 7/1/2014, but never more than the 10-year Standard repayment plan amount. Generally 15% of discretionary income if you’re not a new borrower on or after 7/1/2014, but never more than the 10-year Standard repayment plan amount
Those four years when your child is in college can be a rollercoaster ride, but the scariest part for high-earning parents can be figuring out how to pay for it. It can be tempting to put your own goals on hold while you shoulder the big-but-temporary new burden. In this blog we discuss strategies for paying for college and having a plan to pay for 4 years of college down to the penny.
“A budget is telling your money where to go instead of wondering where it went.”—Dave Ramsey
Covid and the 2020 Elections Less than one week until the elections and the number of cases have risen. These are the headlines we see all of the time which may have you question what you are doing with your wealth. Scary to think about sometimes, but when it...
Would You Like Help Creating A Plan For Your Child's College Fund Or Your Own Retirement Needs?
We Help Families & Individuals Create Financial Plans For Success.
Mark Kelly, Certified Fee-Only Raleigh Financial Planner™
At University Financial Strategies our mission is to help families think beyond just saving for college, but helping leverage strategies that leverage your unique situation to help you save on college costs. We take into consideration topics like specialized college-planning strategies for business owners, planning for financial aid, school-specific scholarships, coordinating college planning with grandparents, cash-flow strategies and options for covering shortfalls, to name just a few.
4801 Glenwood Avenue
Raleigh NC 27612
The information on this site is provided “AS IS” and without warranties of any kind either express or implied. To the fullest extent permissible pursuant to applicable laws, University Financial Strategies, LLC.(referred to as "University Financial Strategies") disclaims all warranties, express or implied, including, but not limited to, implied warranties of merchantability, non-infringement and suitability for a particular purpose. University Financial Strategies, LLC.does not warrant that the information will be free from error. None of the information provided on this website is intended as investment, tax, accounting or legal advice, as an offer or solicitation of an offer to buy or sell, or as an endorsement of any company, security, fund, or other securities or non-securities offering. The information should not be relied upon for purposes of transacting securities or other investments.
Your use of the information is at your sole risk. Under no circumstances shall University Financial Strategies, LLC.be liable for any direct, indirect, special or consequential damages that result from the use of, or the inability to use, the materials in this site, even if University Financial Strategies, LLC.or a University Financial Strategies, LLC.authorized representative has been advised of the possibility of such damages. In no event shall University Financial Strategies, LLC.have any liability to you for damages, losses and causes of action for accessing this site. Information on this website should not be considered a solicitation to buy, an offer to sell, or a recommendation of any security in any jurisdiction where such offer, solicitation, or recommendation would be unlawful or unauthorized.