Student Loan Consolidation After Graduation–Debt Management Plans To Ease Repayment Burden

Numerous students turn to student loan consolidation options after graduation as a way to ease the burden of repaying student loan debt and manage these debts in a way that will allow them to afford their monthly payment obligations. Student loan debt is one of the rising sources of debt which many Americans are combating, and there are some indications that student loans are competing with credit card debt for the highest debt obligations that individuals are repaying.

However, questions over student loan consolidations have arisen as there are some advisers who question whether consolidating debt of any kind is wise. Yet, there are those who feel that, with the current job market, students who have various student loan debt obligations may run the risk of defaulting on their debt or missing payments, which can do damage to their credit score early in life and this would obviously make a graduate’s financial life more difficult down the road.

A poor credit score can make financing difficult like when an individual attempts to buy a home or, in some cases, bad credit scores have reportedly been the reason that some job seekers have been denied an employment position. Obviously, graduates wish to avoid missing payments on student loan debt and the financially savvy graduates who are repaying debt from college loans wish to erase these obligations as quickly as possible.

Yet, there remain some advisers who feel that consolidating debt, like student loans, can cause the overall costs that one must pay to rise thanks to an extended repayment timeframe and interest. While there are student loan consolidation plans, like those on federal student loans, which can come with a low interest rate, a higher principle amount on a consolidation loan can lead to higher overall costs, but for students who simply cannot meet multiple college loan repayment obligations, consolidation has been their only option.

Financial advisers and student aid counselors alike have suggested that graduates look at their personal student loan situation and weigh the options as to which means of repayment will be best. It goes without saying that students who have a small amount of debt or only a few student loans may be able to combat these debts separately and erase them in a timelier manner since paying off lower principal amounts can be easier.

Students who can erase debts separately through smart budgeting and repayment habits may be in a better position to find student loan debt relief than if they had consolidated their debt, so these options must be weighed before a student loan debt repayment plan is chosen. However, graduates who have consolidated student loan debts have been able to erase their debts in a shorter amount of time by simply paying more than the minimum monthly payment requirement on their consolidation loan.

The opportunities available to graduates when it comes to erasing their student loan debt will depend on their income, student loan debt situation, and basic financial practices. However, advisers have, again, suggested that by simply reviewing one’s student loan situation, the most affordable plan can be chosen which will allow a graduate to erase their debt at the lowest cost possible.