WELCOME!

Managing Your Student Loans

and

Your Finances

The Agenda:

MANAGING LOANS

REPAYMENT

SPENDING

Things you need to know:

• How much have you borrowed?

• Who is my servicer?

• What are my options for repayment plans?

• When is my payment due?

Log in to www.studentaid.gov with your FSA User ID and password.

The Loan Simulator

Standard Monthly Payment

Traditional Plans• Standard• Graduated

• Extended

Monthly payments for the entirerepayment term are calculated up-front and disclosed to you.

For more info, visit www.studentaid.gov

Standard Plan

• All borrowers are eligible for this plan.• You’ll usually pay less over time than under other

plans.• Standard Repayment Plan with a 10-year

repayment period is not a good option for those seeking Public Service Loan Forgiveness (PSLF).

• Standard Repayment Plan for Consolidation Loans is not a qualifying repayment plan for PSLF.

Income-Driven Plans• PAYE• REPAYE• IBR

Monthly payments are based on your income and other factors. Payments are recalculated annually.*must meet qualifications

Visit www.studentaid.gov for more info.

Based on family size, income, state.

Pay As You Earn(PAYE)

• Your monthly payments will be 10 percent of discretionary income, but never more than you would have paid under the 10-year Standard Repayment Plan.

• Payments are recalculated each year and are based on your updated income and family size.

• You must update your income and family size each year, even if they haven’t changed.

• If you're married, your spouse's income or loan debt will be considered only if you file a joint tax return.

• Any outstanding balance on your loan will be forgiven if you haven't repaid your loan in full after 20 years. (regular forgiveness not PSLF)

Pay As You Earn(PAYE)

• You must be a new borrower on or after Oct. 1, 2007, and must have received a disbursement of a Direct Loan on or after Oct. 1, 2011.

• You must have a high debt relative to your income(Partial Financial Hardship).

• Your monthly payment will never be more than the 10-year Standard Plan amount.

• Good option for those seeking PSLF.

Revised Pay As You Earn(REPAYE)• Your monthly payments will be 10 percent of discretionary income.• Payments are recalculated each year and are based on your

updated income and family size.• You must update your income and family size each year, even if they

haven’t changed.• Interest subsidy on ½ of the unpaid interest!• If you're married, both your and your spouse’s income or loan debt

will be considered, whether taxes are filed jointly or separately (with limited exceptions).

• Any outstanding balance on your loan will be forgiven if you haven't repaid your loan in full after 20 years (if all loans were taken out for undergraduate study) or 25 years (if any loans were taken out for graduate or professional study).

How does the interest subsidy work?

• For calculating an estimate on interest subsidy, take the REPAYE monthly payment amount and subtract it from the monthly interest accrual and then divide by two.

$ 982 Interest

- 294 REPAYE Payment

$ 688 Remaining Interest /2 = $344 estimated interest subsidy

That is a savings of $4128 over 12 months!

IBR – New and Old Borrowers• Your monthly payments will be either 10 or 15 percent of

discretionary income.• Payments are recalculated each year and are based on your

updated income and family size.• You must update your income and family size each year, even if they

haven’t changed.• If you're married, your spouse's income or loan debt will be

considered only if you file a joint tax return.• Any outstanding balance on your loan will be forgiven if you haven't

repaid your loan in full after 20 years or 25 years, depending on when you received your first loans.

• You may have to pay income tax on any amount that is forgiven.

$193,310

If you owe this amount…

$2155

Your monthly payment will be…

$294

However, it could look something like this when you log into the loan simulator…

www.studentaid.gov

The Public Service Loan Forgiveness (PSLF) Program forgives the remaining balance on your Direct Loans after you have made 120 qualifying

monthly payments under a qualifying repayment plan while working full-time for a

qualifying employer.

Qualifying employment for the PSLF Program Employment with the following types of organizations qualifies for PSLF:•Government organizations at any level (federal, state, local, or tribal)•Not-for-profit organizations that are tax-exempt under Section 501(c)(3) of the Internal Revenue Code•Other types of not-for-profit organizations that provide certain types of qualifying public services•Must complete paperwork with employer for PSLF.

What is a qualifying monthly payment?A qualifying monthly payment is a payment that you make•after October 1, 2007;•under a qualifying repayment plan;•for the full amount due as shown on your bill;•no later than 15 days after your due date; and•while you are employed full-time by a qualifying

employer.

Important points to remember about qualified payments:

You cannot make a qualifying monthly payment while your loans are in•an in-school status,•the grace period,•a deferment,•a forbearance, or•default.

Your 120 qualifying monthly payments do not need to be consecutive.

What is a qualifying repayment plan?

Income Driven Repayment Plans:

Plans that base your monthly payment on your income. REPAYE, PAYE, IBR

If you want to qualify for forgiveness under PSLF, you need to be in one of the IDR’s.

Click here for help!

Should I consolidatemy loans?

Consider Direct Loan consolidation:

-ONLY if you have multiple servicers to repay

-to make FFELP(loans made prior to 2010) and Perkins loans eligible for Public Service Loan Forgiveness

-to make FFELP and Perkins loans eligible for REPAYE,PAYE or IBR

Effects of consolidating:

-A longer term will increase the interest costs.

-Likely will be a higher interest rate.

-May negatively affect subsidies, grace,

deferment, cancellation, or forgiveness options.

Repayment of a direct consolidation loan will begin 60 days after the consolidation is processed.

Where can I find infoon my Private Loans?

If you don’t remember who your servicer(s) is,it should be listed on your credit report.

annualcreditreport.com

Consolidating Federal loans with a Private Company – be cautious!

-you lose all rights, terms, and conditions that are currently guaranteed to you under the federal programs(student loan tax deductions, discharge in case of death or disability).

-no longer eligible for forgiveness programs

-repayment options we’ve discussed are not an option

-READ THE FINE PRINT!

Where can I find infoon my Institutional Loans?

UAMS Institutional Loans serviced byECSI

heartlandecsi.netor

Contact your institution.

How can I create aworkable budget?

Calculate yourmonthly income

paycheckcity.com

paycheckcity.com

Calculate yourmonthly expenses

Monthly Budget

2018

BILLS MONTHLY Be sure to enter a minus sign in front of the amount.

MORTGAGE/RENT (850.00)

ELECTRIC, WATER, GAS, SEWER, GARBAGE (120.00)

FOOD HOUSEHOLD SUPPLIES HEALTH BEAUTY (450.00)

GAS (80.00)

CAR PAYMENT

CAR INSURANCE (100.00)

DEBT (CREDIT CARDS, LOANS, ETC.)

EMERGENCY (100.00)

PHONE, INTERNET, CABLE (140.00)

LAUNDRY/DRY CLEANING

CLOTHES (50.00)

HAIRCUTS (20.00)

DINING OUT/ENTERTAINMENT (150.00)

PETS (25.00)

GYM (20.00)

STUDENT LOAN (186.00)

HEALTH/DENTAL/VISION INSURANCE

CAR MAINTENANCE (25.00)

VACATION (100.00)

GIFT FUND (100.00)

TOTAL EXPENSES (2,516.00)

SPOUSE'S INCOME Update with paycheck stubs

MY INCOME 2,850.00 Update with paycheck stubs

TOTAL DEFICIT/OVERAGE* 334.00

Set your goals!

Long term goals: retirement, home, pay off student loans.

Short term goals: emergency fund, pay off credit card debt.

Ways to pay down debt and accumulate wealth?

Live below your means.Be conservative in your purchases.

Do not buy a home at the top of your budget.

Purchase a used car instead of a new car.

Just a recap… Visit Studentaid.gov to see who your servicer is and when

you go into repayment (if you had a lapse in school, you may have some loans that are going into repayment now).

Create an online account with each of your servicers Sign up for auto-draft which often gives a .25% interest rate

reduction Consolidate only if necessary. Complete Income Drive Repayment Application

at studentaid.gov and renew each year. Complete Public Service Loan Forgiveness application (if

interested, visit studentaid.gov for qualification information). Update each year.

Sign up to receive 1098 T for the next tax year if you are a recent graduate.

Questions?

Janice NottenkamperStudent Financial Services

Debt Management501.686.7832

Zoom and Face Time Appointments Available

Make an appointment to go over your options for repayment, plan your budget, and discuss PSLF.

I hope you find this info helpful and that it eases your transition into loan repayment. Please thoroughly research these topics before you make any decisions.

Make contact with your loan servicer(s) as they handle the billing and other services on your federal student loans. They can assist you with repayment plans, loan consolidation and other tasks related to your federal student loan. If your circumstances change at any time and you need assistance, your loan servicer is always available. If you have additional questions or concerns, please feel free to contact me as well. Best of Luck!

Some information for this presentation was obtained from the website below. They are great resources, and I encourage you to visit them for additional information.

www.studentaid.gov