6 Common Mistakes to Avoid When Repaying Student Debt

Student loan experts provide advice and support on medical student loan debt and repayment.

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glAdvisor
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6 Common Mistakes to Avoid When Repaying Student Debt

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6 Common Mistakes to Avoid When Repaying Student Debt

Young health professionals tend to be burdened with high debt levels, relatively low starting salaries and very busy schedules. This combination can often lead to costly mistakes when entering student loan repayment. Understanding your options and taking a strategic approach to managing your debt can have a significant positive impact on your financial net worth.

Below we’ve outlined common mistakes that new health professionals should avoid when repaying their student loans:

1. Treating all debt equally: Many recent graduates often treat their student loans the same during repayment and allocate their monthly payment equally across all of their debt not realizing this strategy is flawed. It can be more advantageous to focus on retiring higher rate debt first to achieve interest cost savings.

2. Overusing forbearance: Forbearance can provide temporary payment relief for graduates with high debt and low starting salaries. However, this option can result in increased costs, as interest continues to accrue on a borrower’s loans while in forbearance. There are other repayment options available, such as Income-Based Repayment, which can help reduce monthly payments to a more manageable amount and provide savings opportunities that are not available with forbearance.

3. Failing to learn about new repayment options: New federal loan relief programs are now available that can help eligible borrowers reduce their monthly payments and achieve significant savings.

Click here to read the full list of mistakes...

Brady Kinesia
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Re: 6 Common Mistakes to Avoid When Repaying Student Debt

Post by Brady Kinesia »

Hmmm... daunting fact from the article about compounded interest and more debt building up during residency:

"For example, a graduate with $165,000 in debt at today’s rates accrues close to $1,000 a month in interest during the forbearance period, all of which will be capitalized or added to the total loan balance to be repaid."

jamesshaffer85
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Re: 6 Common Mistakes to Avoid When Repaying Student Debt

Post by jamesshaffer85 »

Really helpful info. Truly helpful tips which might help us see new opportunities for repaying the debt. Indeed, with every problem comes an opportunity. Thanks for this inspiring reminder and an eye-opening post. As to me, it's important to understand that here are variety of perspectives and several solutions. Thanks for sharing

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Jcharted
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Re: 6 Common Mistakes to Avoid When Repaying Student Debt

Post by Jcharted »

That was really a very informative post. I've learned so much from it. Keep posting.

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Re: 6 Common Mistakes to Avoid When Repaying Student Debt

Post by DavidIR »

Great prompts. Thanks for sharing!

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