MASSACHUSETTS EDUCATIONAL FINANCING AUTHORITY

FINANCIAL WELLNESS AND MANAGING YOUR STUDENT LOANS

Remember, Your Education is an Investment

A college education allows you to…• Gain financial benefits over a lifetime• Experience personal growth• Be exposed to diversity• Have a lower chance of unemployment

Begin As a Student

If you’re still a student, make smart choices now:• Minimize your debt• Live like a student, not a wealthy professional• Develop good financial habits• Stay organized and keep good financial records• Beware of ATM overuse• Avoid retail therapy• Be realistic about how much money you’ll earn after

graduation

At College Graduation, Take Action

• Determine if you borrowed federal loans, private loans, or both

• Find out your loan servicer (you may have more than one)• Understand what you owe in full and on a monthly basis• Budget for monthly payments• Know where to send your loan payment• Don’t panic

Create Your Post-Graduation Budget

• Identify your goals and write them down• Identify all sources of income• Identify all bills: fixed, discretionary,

and flexible• Use simple spreadsheets and/or online

budgeting tools• Distinguish between needs and wants• Keep it simple• Revise as needed

General Loan Repayment

• Know your grace period – usually 6 months after graduation• Pay on time!• Pay off your loan with the highest interest rate first• Understand your options for repayment• Simplify the payment process – use automatic debit• Contact your loan servicer immediately if you cannot pay• Ask for help if needed

Federal Student Loan Repayment Options

• StudentLoans.gov provides info on federal student loans• Choice of Repayment Plans– Standard – most cost effective– Graduated – useful if you expect a rise in income– Extended – Lower monthly payment and longer loan term– Pay As You Earn Plan (PAYE) – 10% of monthly income and longer loan term

• Other Options– Deferment– Forbearance– Forgiveness– Consolidation– Refinance

Develop the Habit of Saving

• Pay yourself first• Keep an emergency fund• Use direct deposit• Utilize the power of compound interest• Take advantage of the power of time

Importance of Good Credit

• Your credit history can determine your interest rates for purchases• Employers can check your credit before hiring you• Landlords and rental companies may check your credit• A bad credit decision stays with you for a long time

Maintaining Good Credit

• Avoid default!• Review your credit report annually• Keep good records• Pay your bills on time• Ask for help if you need it• Understand your credit score

Helpful Websites

mefa.org asa.org saltmoney.org studentaid.ed.gov irs.govcreditinfocenter.com bankrate.com myfico.com annualcreditreport.com creditkarma.com mint.com

Contact Us

160 Federal Street, 4th Floor, Boston, MA 02110mefa.org | info@mefa.org | (800) 449-MEFA (6332)