Personal Finance

Tips for Repaying Your Student Loans

If you’re like me, you vaguely remember signing a form every year at college registration time. Now that you’ve graduated, it’s all become painfully clear — those forms were promissory notes detailing your student loan obligations. Your loans aren’t going away, and you’ll want to repay them as quickly as possible. So whether you have a small sum or a small fortune to pay off, it’s helpful to brush up on some student loan basics.


After you graduate, you’ll probably have a lot to think about — deciding where to live, finding a job, renting an apartment. Fortunately, you don’t have to add student loans to your list, at least not right away. Thanks to the grace period built into most student loans, you’ll likely get anywhere from six to nine months before you need to start repaying your loans. This gives you some breathing room to get financially settled.


Gone are the days when your only repayment option consisted of fixed, equal payments spread over a 10-year term. Though this is certainly one option — and typically the fastest way to pay off your loans — it’s not the only option. Because of the growing number of students who require student loans to finance their education and the ever-increasing amount of their debt, the federal government offers several flexible repayment plans to help students manage this large financial responsibility.

For more detailed information regarding these options check out a previous post called Take Charge of Your Student Debt Repayment Plan.


On the bright side, you might be able to deduct some or all of the student loan interest you pay on your federal tax return. In 2019, if you’re a single filer with a modified adjusted gross income (MAGI) under $70,000 or a joint filer with a MAGI under $140,000, you can deduct up to $2,500 of student loan interest that you pay during the year. A partial deduction is available to single filers with a MAGI between $70,000 and $85,000 and joint filers with a MAGI between $140,000 and $170,000.

If you paid $600 or more of interest to a single lender on a qualified student loan during the year, you should receive Form 1098-E at tax time from your lender, showing the amount of student loan interest you’ve paid for the year. For more information, see IRS Publication 970.