Welcome to visitors from the VCU Scholarship Sharing College Funding Panel!
We’ve put together this resource page to help you with some of the questions that came up at the panel. You can also send us an email with your questions and we’ll be happy to give you additional suggestions.
Student loan repayment
Paying for college
Out of college – now what?
Student loan repayment
Students have a grace period of 6 months from graduation before payments begin. You will be contacted by your loan servicer with instructions and repayment plan options. There are a number of choices but the standard repayment plan is fixed monthly payments for 10 years. You have 45 days from being notified of your options to make your choice, or the servicer will enroll you in the standard repayment plan.
Use this 6 month period to determine what your best repayment plan is. Login to studentloans.gov with your PIN to estimate your payments.
Know what you owe by visiting www.nslds.ed.gov. This will show you all your federal student loan debt. If you have private student loans, you will need to contact your lender for similar information.
Do not automatically consolidate your loans. This is an important decision and it should not be done without a clear understanding of what you are doing.
If your income is low relative to your loan payments, you may qualify for one of the income driven repayment plans. This means that your loan payment is a percentage of your income and your payments change as your income changes. You have to apply for it each year and be approved.
The most attractive plan is called Pay As You Earn. If you have not repaid your loan in full after 20 years of qualifying monthly payments, the balance of your loan will be forgiven.
Public Service Loan Forgiveness is a plan that allows your loan balance to be forgiven after 10 years of payments if you work full-time in certain jobs, making the right kind of loan payments
Teachers have special loan forgiveness and repayment options.
Other careers also have special repayment assistance programs: Peace Corps, AmeriCorps, Military, and National Health Service Corps.
If you cannot make your loan payments, contact your servicer immediately and talk about the options. Don’t wait to become delinquent. There are a number of options available to federal student loan borrowers.
Deferment means that you work out a plan with your servicer for a period where your payments are delayed. An example of this would be while you were looking for a job.
Forbearance can come into play when you do not qualify for a deferment. Forbearance means that you are given a certain period of time by your servicer when you don’t have to make payments. You have to ask for it, so if you cannot make your payments, talk to your lender.
Read more about deferment and forbearance here: http://studentaid.ed.gov/repay-loans/deferment-forbearance
Deferment and Forbearance are not always the best choice. Think first about income driven repayment plans.
We can help you sort through the choices and make a repayment plan that fits with your current financial situation.
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Paying for college
There are two approaches to the cost of college: what you pay and how you pay. What you pay means to reduce what college will cost your family. This is done through scholarships and grants, managing your out of pocket expenses, and taking advantage of tax breaks for education. “What you pay” strategies do reduce the amount you pay for college.
How you pay is different than what you pay. How you pay is all about your specific funding plan. It means using your family income and assets, 529 plan, retirement account, student and parent loans, work-study, tuition payment plans, and other payment methods. How you pay is important but it does not reduce what you are paying to the college.
Together, what you pay and how you pay make up your college funding plan.
If loans, either student loans or parent loans, are part of your plan, you should be sure you have addressed future loan repayment as part of your decision making.
For more tips on paying for college, please consider subscribing to our free newsletter, On Course For College. We cover all these topics and more.
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We are huge fans of local private scholarships!
Our CFG ScholarBank database includes hundreds of local scholarships that you can search and investigate. For students currently in college, we maintain a shorter list (shorter simply because most scholarships are for high school seniors!) of local scholarships for college students.
Our free newsletter, Scholarship Spotlight, contains helpful tips and information on finding and using scholarships as well as special insights on different awards.
Area high schools also offer wonderful leads for students to investigate. Check with your counseling office to find out what information they have. J. Sargeant Reynolds Community College also has a fantastic scholarship blog that you surely want to check out.
How do you find scholarships that you have a good chance of winning? The best way is to apply to those that are closely aligned with your personal attributes. The better the match, the better the chance of winning. It’s your job to make sure the scholarship judges can see what a good match you are!
Look first in your own backyard. What groups, fields of study, civic associations, employers, stores, financial institutions, and religious organizations are you and your family members aligned with? Do any of these sponsor scholarships? If so, you’ll have a head start.
As good as scholarships are, you need to know your college’s policy on how outside scholarships impact your financial aid package. Many families mistakenly think that the scholarship will reduce their out of pocket costs. That’s unlikely. Here’s why. Some colleges want the scholarship money to reduce the grants the college awards you. Other schools reduce your loans, and other schools reduce unmet need. The impact can also be different depending on whether your aid is need-based or not.
Ask what your college’s policy is on outside scholarships. If your college will reduce unmet need, that’s good. If they will reduce loans, that’s good. If they reduce their grants, that’s not good.
For more tips and strategies on private scholarships, subscribe to our free Scholarship Spotlight.
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Out of school – now what?
College is in your rearview mirror and you are starting to realize that you have a number of financial decisions to make. What’s the “right” way to spend your money? How much should you be saving? Should you pay more on your student loans? What about filing an income tax return?
It’s pretty normal to have financial questions when you are starting out. The trick is in finding good answers to your questions. Most advice is cookie-cutter, save X% and spend Y%, that sort of thing. Most financial advisors don’t want to talk to you unless you happen to have a trust fund.
We believe it all starts with your personal cash flow plan. Identify your financial goals, both short term and long term. What’s most important to you? Getting out of debt? Saving for a house? Living within your means? Whatever your answers are, you can be sure that your plan will be personal to you.
Devising your personal cash flow plan is only half of the battle – good implementation is the difference between success and failure. We guide you through the options and assist you in setting up a system that works for you. It’s anything but cookie cutter!
In the end, you will be squarely on the path to achieving your financial goals. If you’d like to know more about our personal financial coaching for young adults, please let us know.
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