Top 5 Ways to Get Ready for Student Loan Payments
After a three and a half year pause, federal student loan payments will start again in October. Many people’s lives have changed substantially during the pause—they’ve lost jobs and started new ones, had kids, moved to a different location, or bought a new car. While everyone’s lives have changed in different ways, one thing is for sure: no one’s budget looks the same as it did in March 2020. For that reason, it’s best to start preparing for student loan payments now. Here are the top five steps to take:
1. Log into your student loan account
The first step is making sure that you know where your loans are (i.e. who your loan servicer is). Your loan servicer may have switched within the past few years when the Department of Education’s contracts changed. If you don't know who your servicer is, log into StudentAid.gov and scroll down to the "My Loan Servicers" section. Once you’ve confirmed who your servicer is, confirm that you can log into your online account. Don’t wait on this—you don’t want to be trying to get your servicer on the phone right before your payments are due.
2. Update your contact info
If your email address, mailing address, or phone number has changed within the past few years, enter your updated contact information. This ensures that your servicer can communicate with you about when your payments will be due and how much they will be. And yes, you are responsible for your student loan payments whether or not your servicer can find you.
3. Find out how much your payment will be
If you've had to make payments in the past, you may be able to find out how much you were paying by looking back through your student loan account. If not, or if you have never had to make payments, you should contact your loan servicer to find out how much your payment will be so you can start to prepare. You can also use the loan simulator to explore your repayment options and estimate your payment.
4. Practice your payment
Once you get an estimate of your payment, start saving this amount monthly into a separate savings account to practice the payment until they officially resume. This will help you adjust to your new budget in advance and reduce last-minute stress when the payments become due. That may require you to take a close look at your current spending and savings to determine where you can make changes to fit that payment in.
5. Set up automatic payments
If you had automatic payments before the pandemic, you’ll need to set it up again even if you are still with the same servicer. If you are new to paying student loans, setting up auto-pay will ensure that you don’t forget to make a payment!
Need help reworking your budget for student loan payments?
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