While ambitious students are keen on building lucrative careers, do not think twice about taking out a student loan to finance college, the realities of life often tend to catch up when it is time for the repayments to commence. In America, according to Credit Donkey, students step out of college on average carrying a debt burden of $37,000 so when the right job does not come along as hoped for, the loans turn into very heavy millstones around their necks.
Underestimated costs of living as well as numerous unanticipated expenses threaten the budgets of the graduates prompting them to firefight and defer the student loan payments in the hope that they will find suitable employment that will enable them to catch up with the repayment schedule.
When they are unable to repay their student loans, stress begins to build up especially since they are not aware of all the repayment options and find tons of loan regulations very complex and confusing. The lack of any positive action by the lenders to reach out to the borrowers until they start defaulting also compounds the issue.
There is a large variety of online tools and smartphone apps available that young graduates can make use of to manage their student loans. It is often helpful for the borrowers to use a combination of these tools to get the best features of student debt management.
Some of the best apps and tools available to manage student debt effectively:
This is a simple iOS app that can be a lifesaver for graduate borrowers who have got into a mess and are not being able to repay their student debt as per schedule. The app analyzes the spending habits of users to provide a simple way of paying off student debts more quickly while avoiding the burden of high interest. Users need to link a credit or debit card to their ChangEd accounts, which will then round up all purchases to the nearest dollar and use the surplus savings to pay off the student debt.
Unlike most apps, ChangEd is not free to use but the nominal subscription fee of $1 per month should not deter those who are mired in student debt and want freedom as fast as possible.
Student Loan Hero
Student Loan Hero, as the name suggests, is intended to serve as a savior to all those who have fallen behind in their student loan repayments. The app has the capability of linking the student loan across all its features, which makes it very easy for the user to track the loan repayments. The built-in browser tool accesses the loan data from all the important services and provides an updated picture of the current outstanding. The application can also be used to experiment with the various repayment options that the different federal payment plans to design a custom plan for refinancing the student loan.
The effect on the principal amount that making additional payments can be viewed on the app, which also can be used to configure customized repayment plans to save a lot of money by refinancing, and other options like forgiveness or even debt relief using the services of private agencies like National Debt Relief.
This is a very simple to use loan calculator that borrowers can use to pay off their student debts as well as any other debt that they may be carrying. The in-browser tool provides the users with all the vital information of their debt status along with simple graphs so that the user is able to decide on a debt repayment strategy that is just right for him.
The tool is simple to use with users being just required to log in on the homepage and enter all the details of their student loan such as the principal outstanding, the rate of interest, and the minimum monthly payment. Once the user inputs the data, the dashboard can be used to view the current status of the loan with details like the principal paid; the interest paid so far, the average rate of interest, and the date by which the debt will be settled.
The tool also generates payment plans that the user can adapt to pay off the loan more quickly with less impact on the total interest paid. Users can choose between the snowball and avalanche methods of debt payoff and also choose the amount that they would like to pay every month.
Debt Payoff Assistant App
This is a free mobile app available on the iOS operating system that not only allows users to track the progress of their student debt status but also lets you make the payment from within the app itself. The app also gives you the choice of paying back the loan with either the avalanche method or the snowball method that is recommended by numerous financial experts as being the most effective for paying off debts.
The app lets you play around with different parameters to see for yourself how it affects the loan repayment so that you can choose one that suits you the best. Tracking progress is very easy with the app providing users with monthly status reports.
By using this app, users can save money without having to put much thought into the process, or having to plan ahead to pay off their student loans and other types of debts. The app lets users set multiple goals to save for, including student loan or even a much-needed vacation. Digit automatically directs the savings to these goals while permitting the user to constantly track the progress and make alterations.
In a marked difference from a similar app, ChangEd, Digit does not round up the charges of your debit or credit card but instead, analyzes the spending habits of the user to evaluate how the savings can be best generated and to what extent can the user save without disrupting his current lifestyle.
While you may require taking a student loan to get a better start in life with a college education, you need to always keep in mind that paying it off in the shortest possible time should be your number one priority. Using these apps and tools can help you to avoid confusion and offer the best strategy to pay off the debt as economically as possible.