If you’re feeling student loan stress, you’re not alone. In a study on the psychological effects of student debt, Student Loan Hero found that 61% of respondents said their student loan worries were spiraling out of control, and 64.5% reported losing sleep over their debt.
While it’s natural to worry about debt, there are ways you can manage your anxiety and take back control of your finances. If you’re feeling overwhelmed, these eight strategies can help.
1. Reach out to friends and family
2. Try to focus on the positive
3. Speak to a therapist, if needed
4. Come up with a repayment plan
5. Adjust your student loan payments
6. Refinance for a lower interest rate
7. Find out if your employer can help
8. Take it one step at a time
Managing debt can be an isolating experience, especially since many people shy away from talking about money. But getting the support of friends and family can lower your student loan stress and help you feel less alone.
“The most helpful coping strategy that worked for me was talking about it on the phone with my parents,” said Heather Taylor, a senior editor at PopIcon who managed to get her student loans out of default and is now almost debt-free. “They could not help me out financially, but were able to give me emotional support.”
Outside of your inner circle, you might also find a supportive network online. Perhaps you could join a student loan forum on Facebook or Reddit or share your debt payoff journey on Instagram.
“My advice for borrowers feeling stressed out about their debt is to talk to someone they can trust about it,” said Taylor. “This person may be a close family member or friend, but they have to be a good listener and supportive of what you are doing. The best ones check in on you to make sure you’re alright and want updates about how far you’ve gotten and will cheer you on to the finish line.”
Although it’s easier said than done, cultivating positive thoughts will also help you cope with your student loan stress.
“Accept that you have the debt,” advised Leslie Tayne, financial attorney and director of Tayne Law Group, P.C. “If you fight it or try to put your head in the sand it will simply pop up when you don’t want it to since it’s, frankly, not going away on its own.”
Remember that you took out these loans for a purpose, and hopefully they helped you earn a degree and boost your career prospects.
“Think of the positives that the student loan debt brought to you, like education and experience,” said Tayne. “Own it, accept it and know that you’re not alone … positive thinking can help improve your financial stress.”
By adjusting your mindset to focus on the positive, you’ll feel more empowered to take action on your student loans.
If your student loan stress levels are high, you need to take care of yourself before you can take action on your loans. To find coping strategies, it could help to speak to a therapist or other mental health professional.
“If you’re totally overwhelmed where you feel paralyzed, consider a therapist to help with your anxiety and coping methods,” said Tayne. “Always reach out for help when you feel helpless or overwhelmed where it’s interfering with your daily life.”
Along with speaking to a professional, find other ways to relieve your anxiety in your day to day.
“Find an outlet like exercising or volunteering,” said Tayne. “Find a way to refocus your mind. Turn off your brain from focusing on the debt.”
At the end of the day, taking care of your mental and emotional health is your top priority. Once you’ve learned to manage your anxiety, you’ll be in a better position to manage your student loans.
Instead of ignoring your student loans, come up with a repayment plan that works for your budget. With a clear strategy, you’ll be able to see the light at the end of the tunnel.
“The number one thing I advocate for individuals when coping with student loan stress is to make a financial plan,” said Bob Forrest, a financial advisor at RBC Wealth Management. “A lot of our anxiety as humans in general comes from the unknown … Do yourself a huge favor and create a comprehensive financial plan. You’ll see not only that you will pay off the loan, but you’ll see how and when you’ll pay it off as well.”
Write down all your loans and interest rates, and use student loan calculators to set goals. As your financial situation changes, adjust your plan accordingly. If you find ways to make more money or reduce your expenses, you might even be able to make extra payments to pay off your student loans ahead of schedule.
If your student loan payments are breaking the bank, look into options for lowering them. If you have federal student loans, for instance, you could apply for an income-driven repayment plan to lower your monthly payments so they’re more in line with your income level. You might also apply for deferment or forbearance if you need to pause payments temporarily.
While most private lenders don’t offer income-driven repayment, many will let you postpone payments during a time of financial hardship. Pausing payments can help you through a rough patch, but this option should only be used as a last resort since interest will keep accumulating on your loans.
Be sure to communicate with your loan servicer and research your options so you can find an approach that works for you.
One of the hardest parts of repaying student loans is keeping up with interest, especially if you got stuck with a high rate. Fortunately, many private lenders and some states offer student loan refinancing options.
“The best advice I always give our members is to refinance their student loans,” said Adam Marlowe, an executive at Georgia’s Own Credit Union. “I recently helped a member eliminate seven years and nearly $50,000 from their burden by refinancing, so it’s a secret weapon most don’t know is at their disposal.”
To qualify for refinancing, you’ll need to have decent credit and a stable income (or to apply with a cosigner who does). But make sure you’re not relying on any federal protections, as refinancing student loans with a private lender means you’ll lose access to federal payment plans and forgiveness programs.
More and more employers are offering a student loan repayment assistance as a benefit to help their employees pay off their student debt. It could be worth speaking with human resources about your struggles to see if they can help.
“If you’re an employee who is struggling with student debt, reach out to the HR department,” said Ellen Mullarkey, VP of Business Development for the staffing company Messina Group. “Ask if there is anyone who can point you toward the right channels. Let them know that you’re dealing with some serious stress, and they should be able to help you figure it out.”
Even if your employer won’t help you pay off your debt, they might be able to point you toward financial or mental health resources that could help.
Paying off student loans can feel like a marathon rather than a sprint. While it might be years before you’re debt-free, remember that you’re making progress every day.
While your student loan balance might be daunting, your best course of action is to take things one day and one payment at a time. That way, you can gradually chip away at your balance until it goes down to zero or you qualify for student loan forgiveness.
Slowly but surely, you can move closer to a life free from student debt.