Did you graduate in May 2013? Well, Seasons Greetings from Uncle Sam. The student loan six month deferment period has ended and somewhere during December your first loan payment will be due. Unless you’ve extended your deferment period for one of the following reasons:
You’re crazy enough to go back to school at least half-time.
You’re being super generous and helpful in a fellowship program or a rehab training program for the disabled.
Your parents think you’re a bum because you’re unemployed or just cannot seem to find full-time employment.
You’re experiencing economic hardship… Like the rest of people who have graduated within the last year.
You’re being completely admirable and serving our country in a period of active duty.
If none of these things are the structure of your everyday life, then hopefully you’ve been preparing for this day. Without preparation you could find yourself in holly jolly debt going into the holiday season with your first loan payment coming due.
So how are you going to handle repayment? Thanks to the Department of Education, there’s a new option for repayment, pay as you earn, that started last November. I suggest you check out that repayment plan if you’re not making as much money as you thought you would be your first year out of college… If you don’t fall into that category stop reading this right now because you don’t need any of this information and it will just be a big waste of your time.
Since you’re all still here, let’s talk about 17 reasons you’re doomed to pay back your student loans for the rest of ETERNITY.
1. You have no idea where your money even goes.
Without using a tool to track your spending, you'll be shocked how much you spend every month. Typically it's much more than you'd ever guess. Mint.com is a free tool that requires minimal effort on your part to identify your spending trends. If paying down debt is your goal, check out Ready for Zero.
2. You spend too much of your income on alcohol.
$50 and a hangover later you realize what you've done because you couldn't pass up on the ‘epic night.' Responsibly spending on a student credit card and paying it off can help you build credit, but that's no excuse for racking up as much as you can on your card.
3. You can't live without the latest…everything.
While Apple's latest iPhone is tempting, and the newest Coach bag is calling your name -- your phone and bag will last another year. It's more important to avoid defaulting on your student loans, which is one of the costliest mistakes you can make.
4. You carry a balance on your store credit card.
With interest rates typically above 25% on store credit cards, the money you'll spend on fees alone is downright scary.
5. You have no idea what a budget is.
Spending money freely on things without thinking about your financial situation isn't the key to financial well-being.
6. The idea of going a day without a coffee from Starbucks is unacceptable.
You can probably do without the venti-skinny-carmel-soy-macchiato with two shots of espresso to get you through the day.
7. You’d rather spend $50 eating out than buying groceries that would last you a week.
We know how tempting it is to just eat out after a long day at work, but that $50 will go much further at the grocery store or to pay back student loan or credit card debt.
8. That deal voucher from Groupon was “too good” to pass up on.
Because you had always wanted those Chinese wishing lanterns adorning your living room and at $10 a set you couldn't resist.
9. You couldn’t miss the “once in a lifetime” vacation with all your friends.
You'll talk about the great time you had and how much money you spent only to have your buddies ask you to head to Vegas next month with them.
10. Paying over $100 a month for the 490 channels that you’ll never watch.
Justifying over $1000 a year on cable just to watch Shark Week just isn't worth it.
11. Smoking 2 packs a day isn't saving your body or your wallet.
You'll save over $3,000 per year if you kick the habit, which is nothing to sneeze at.
12. You had to have the luxury apartment that costs 75% of your paycheck every month.
Sure the view is nice and your kitchen sparkles, but by spending an obscene amount of your paycheck on rent, you aren't building wealth by any measure.
13. You gladly make the "mascara face" when you have to try every new mascara from Sephora, obviously because your eyelashes are never voluptuous enough.
14. You had to buy a whole new wardrobe for your “office job.”
15. You buy into the slogan “Hey, you never know” every time you walk into a gas station.
16. That gym membership you swore you’d use every week.
For more information about building and maintaining your credit as a student, visit Credit Card Insider's Student Hub.