Student Loans


In the United States, student loans are one of the largest sources of debt for Millennials (a name used for anyone born between the 1980s through the mid-1990s). 

Higher education is expensive in America, and most students can’t afford to study without taking out loans. 

While bachelors or masters degrees can usually help students obtain more high-paying jobs in the future, these graduates are still responsible for paying back whatever they borrowed to pay for school. Over time, they’re also required to pay interest on their loan amounts. 

If you have student loan debt, there are different types of loans you could have gotten. These fall into two main categories: federal or private student loans. 

Federal student loans consist of the following options: 

  • Perkins loans– Perkins loans were issued prior to September 2017. To receive these loans, undergraduate and graduate students needed to have very high financial need. Students who received these loans borrowed money from their schools. As a result, they need to repay their universities whatever money they borrowed. Furthermore, students who received Perkins loans and who now work in certain public service fields may be eligible for loan forgiveness
  • Direct unsubsidized loans – Both graduate and undergraduate students are eligible to take out direct unsubsidized loans. There are no financial requirements they need to meet to receive this funding option. However, students who took out these loans need to be aware that they’re responsible for paying interest on their loans from the day their loans are issued to them. 
  • Direct subsidized loans– Unlike direct unsubsidized loans, direct subsidized loans are only available to undergraduate students with financial need. Additionally, students who take out these loans are not responsible for paying interest until they graduate. While they’re still in school, the federal government pays their loan interest. 
  • Federal direct PLUS loans– Graduate students and students’ parents are eligible to take out these PLUS loans. These loans usually come with higher interest rates, which will affect the amount borrowers need to pay over time. 

On the other hand, private loans are loans you take out for specific purposes. Since these options aren’t regulated by the government, they likely have different terms you need to be aware of for how and when you need to pay your loan back. 

Managing Your Student Loan Debt  

Once you’re familiar with the type of loan you took out, you can better understand how to pay it back. However, for the student loan debt, your most effective strategy will be to make sure you make the required payment each month. Specifically, you should: 

  • Be aware of how much you owe. 
  • Know when your interest started accruing or when it will start. 
  • Familiarize yourself with the length of your loan.