Unfortunately, it is not possible to finance your college education solely on subsidized student loans. By the time you graduate you will most likely have far more to pay back in the form of unsubsidized student loans.
This means that you will be paying back a fair amount of interest on these accounts in addition to the principal amount. The best way to avoid massive amount of interest on your federal financial aid is to make payments on the interest while you are still in school.
There is no fee for early repayment. If you can send in small payments each month that cover whatever amount of interest has accrued it will lessen the burden later on. Do this through both your time in school and your grace period following graduation, and by the time your repayment period begins you are starting with the principal loan amount.
This will shorten your repayment period and the amount of interest that will add to your student loan debt. You don't have to make a payment every month while in school. If you are short on money one month you won't be penalized for not sending a check in. However, when you can afford to send a payment in on the interest, you will find that it pays dividends for you in the future.
|Jennifer Mathes, Ph.D.|