Your 6-Step Plan for Managing Student Loans—and The Tools to Help You Do It
When you’re struggling to pay student loans, it helps to know you’re not alone. Members of the class of 2016 now carry, on average, $37,173 in student loan debt—up 6% from last year. It’s not easy, but there is good news: You live in the digital age! Want to redecorate your home? There’s an app for that. Manage your bucket list? There’s an app for that, too. So it should come as no surprise that there are a number of websites, tools, and finance apps designed specifically to improve the loan payment experience.
Yet, even with so many options available, it can be hard to make a plan to tackle that debt in a way that’s efficient and helps you see results. We know you’re busy and there’s no quick and easy way to filter through hundreds of online resources to find the best tools for your needs, so we’ve done the work for you.
The six-step plan below includes the best tools, websites, and personal finance apps to help you manage your student loans and get your bank account on track to meet all of your financial goals.
Step 1: Get Organized: Face Your Total Loan Debt
It sure can be scary to meet your loan debt head-on, but you can’t take steps to get out of debt until you know exactly how much you owe. So take a deep breath and download the Debt Payoff Planner and Calculator. Although it’s not specifically a student loan calculator, this helpful app will tell you how many years you have to go until you’re debt-free. Just add your loans, input your balance, minimum payment, and annual percentage rate (APR), and then create a payoff plan. Not only is this tool easy to use, the interface includes some pretty great visuals, too.
Step 2: Find the Best Refinancing Rate
You don’t want to pay more loan interest than you have to, right? Student Loan Hero and LendEDU are both powerful tools to help you find the best refinance lender for your student loans. LendEDU reports that some borrowers can save up to $14,000 by finding a lender through its platform. Not too shabby, right? You can also hop over to the student loan refinancing page to learn how to lower monthly payments and save on total interest by reducing your interest rate.
Step 3: Protect Your Credit Score—It’s Gold
Protecting your credit is critical while you’re in debt and once you’re out of it. If you’re thinking about refinancing your loans, making a major purchase (like a home or a car), or simply setting yourself up for general financial success, you need to have good credit. Credit Karma can help. Not only can you view your credit score for free on the site, but you can also track and optimize your score using free tools and calculators. You can even save money with their personalized debt management recommendations.
Step 4: Set a Budget & Know Where Your Money Is Going
You need stay on top of your money, especially when paying off student loans. So a great budgeting app is a must-have. You Need a Budget (YNAB) helps you put every dollar to work, finds wasted money in your budget, and holds you accountable to your goals. Mvelopes allows you to connect your bank accounts, pay your bills, and even upload receipts so you can see your budget work in real time. Wally is another budget app with some pretty fantastic features. You get a 360-degree view of your finances, bill payment reminders, and even pats on the back (in the form of virtual notifications) when you reach your money milestones. Two other apps that earn an honorable mention are Mint Bills and Level Money.
Step 5: Look Into Employer-Provided Options
More and more companies are recognizing that student loan debt hampers their employees’ ability to contribute to a 401(k) or savings account, so they’re offering student loan assistance. By lightening the debt load, these employers help better prepare workers to meet future financial goals.
We’re proud to say that we’re not only part of this movement, we’re also helping to lead the charge. SoFi at Work has partnered with over 600 companies and associations to help them provide better financial support to their employees and customers. Ask your human resources department if you’re eligible for this benefit.
Step 6: Keep Your Eyes on Big Picture to Maintain Financial Fitness
When you focus on a specific goal it’s easy to get tunnel vision. So always keep in mind that student loans are only part of your overall financial picture. In addition to budgeting monthly for food, entertainment and utilities, you might have a car loan or even a mortgage to pay. And all that spending should be tracked.
My Parabola is a comprehensive mobile app that tracks your finances, awards badges when you reach certain milestones, such as paying off a loan or buying a car. Ready for Zero is a tracker that allows you to link and manage your debt, finances, and even your credit score.
Broader personal finance management sites, such as Learnvest and Mint, can also help you manage your student loans with an eye on the future. Using your login details for credit cards, bank accounts, and lenders, these sites automatically update your information on a regular basis, providing you with a comprehensive financial overview. Each provides a deep dive into your finances, showing you where you’re over and under budget, your total net worth, and how your student loans impact your bottom line.
Student loans can be overwhelming — we get it! But always remember that when you’re in debt, information is your friend. Our Student Loan Smarts blog series and The SoFi Guide to Refinancing Student Loans have all the expert tips and tricks you need to move forward and live life on your terms.