When graduates leave school, they often walk away with crippling student loan debt. But those student loans can affect more than just finances.
A recent study shows that student loan debt can literally make you ill. It can have long-lasting repercussions, even affecting your productivity and performance at work.
Student loans and health
The American Student Assistance organization, a non-profit focused on college affordability, released a study on the connection between student loans and health. The group surveyed over 500 students and 450 human resources professionals.
The results were pretty bleak: 40 percent of respondents reported that worrying about student loans has impacted their health.
But it’s easy to see why. When you’re stressed about student loan debt, it can impact your sleep, eating habits, and daily routine. If you feel overwhelmed when it comes to your debt, it can cause depression. That can have serious ramifications on your body.
Even worse, if you’re worried about making ends meet you might put off going to a doctor. You might opt for the lowest tier of health insurance or even skip a policy altogether. That can leave you unprepared to handle medical issues that come up.
Student loans can cause your performance at work to slip, too. If you’re sleep deprived because you were up all night worrying about your debt, you’re more prone to sloppy work and simple mistakes.
Impact on the workplace
“Young workers feel highly stressed as a result of … student debt and that … impacts their health and productivity in the workplace,” said Kevin Fudge, director of consumer advocacy and ombudsman at ASA in a press release.
Because the impact on young workers is so significant, the ASA says this is a major issue not just for graduates, but for employers as well.
“Employers should realize that in order to retain the brightest young talent … they need to provide concrete and straightforward solutions to help alleviate this burden,” said Fudge.
What you can do
If your student loans are impacting your daily life, it’s important to take control of your debt and develop a plan. Even if you’re struggling to afford your payments, there are options available that can make your loans more manageable.
Sign up for an income-driven repayment plan
If you have federal student loans, you might be eligible for an income-driven repayment (IDR) plan. There are four options:
- Income-based repayment
- Income-contingent repayment
- Pay As Your Earn
- Revised Pay As You Earn
While the specifics vary for each plan, the concept of IDR plans is the same. Under IDR, the government caps your monthly payment at a percentage of your discretionary income and the repayment term is extended from 10 years to 20 to 25, depending on your situation. If you’re tight on cash, signing up for an IDR can significantly reduce your payments and give you more breathing room.
After 20 to 25 years, if you still have a loan balance, the government will discharge the remaining amount. An IDR plan can be a valuable tool if you have a high loan balance.
Refinance your student loans
If you have private loans or are otherwise not eligible for IDR, another option to consider is refinancing your debt. By refinancing, you take out a new loan for the amount of your current debt. The new loan will have a lower interest rate and repayment term, so you can choose a plan that works for you.
By reducing your interest rate or extending your repayment term, you can dramatically reduce your monthly payment. That can free up cash for your budget to help you afford everyday essentials, including health insurance premiums.
But if you’re eager to get rid of your student loans as soon as possible, refinancing allows more of your payment to go to the principal rather than interest. With a lower interest rate, you can pay off your loans faster and save hundreds or even thousands over time.
If you have federal loans, it’s important to know that refinancing your debt will cause you to lose certain federal protections, including access to income-driven repayment plans. But if your loans are making you sick, refinancing can be a smart way to accelerate your repayment and regain control over your debt.
Managing student loans
Carrying a large amount of debt can be stressful. More than just an annoyance, student loans can actually impact your health. If your student loan balance is harmful to you or your health, research your options to see if an income-driven repayment plan or refinancing is for you.
Interested in refinancing student loans?Here are the top 6 lenders of 2018!
|Lender||Variable APR||Eligible Degrees|
|Check out the testimonials and our in-depth reviews!
1 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.89% APR (with Auto Pay) to 7.89% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 6.97% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of Month/Day/Year, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 08/21/18. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at email@example.com, or call 888-601-2801 for more information on ourstudent loan refinance product.
© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
APR stands for “Annual Percentage Rate.” Rates listed include a 0.25% EFT discount, for automatic payments made from a checking or savings account. Interest rates as of 11/8/2018. Rates subject to change.
Variable rate options consist of a range from 3.27% per year to 6.09% per year for a 5-year term, 4.64% per year to 6.14% per year for a 7-year term, 4.69% per year to 6.19% per year for a 10-year term, 4.94% per year to 6.44% per year for a 15-year term, or 5.19% per year to 6.69% per year for a 20-year term, with no origination fees. APR is subject to increase after consummation. The variable interest rate will change on the first day of every month (“Change Date”) if the Current Index changes. The variable interest rates are based on a Current Index, which is the 1-month London Interbank Offered Rate (LIBOR) (currency in US dollars), as published on The Wall Street Journal’s website. The variable interest rates and Annual Percentage Rate (APR) will increase or decrease when the 1-month LIBOR index changes. The variable interest rates are calculated by adding a margin ranging from 0.98% to 3.80% for the 5-year term loan, 2.35% to 3.85% for the 7-year term loan, 2.40% to 3.90% for the 10-year term loan, 2.65% to 4.15% for the 15-year term loan, and 2.90% to 4.40% for the 20-year term loan, respectively, to the 1-month LIBOR index published on the 25th day of each month immediately preceding each “Change Date,” as defined above, rounded to two decimal places, with no origination fees. If the 25th day of the month is not a business day or is a US federal holiday, the reference date will be the most recent date preceding the 25th day of the month that is a business day. The monthly payment for a sample $10,000 loan at a range of 3.27% per year to 6.09% per year for a 5-year term would be from $180.89 to $193.75. The monthly payment for a sample $10,000 loan at a range of 4.64% per year to 6.14% per year for a 7-year term would be from $139.65 to $146.76. The monthly payment for a sample $10,000 loan at a range of 4.69% per year to 6.19% per year for a 10-year term would be from $104.56 to $111.98. The monthly payment for a sample $10,000 loan at a range of 4.94% per year to 6.44% per year for a 15-year term would be from $78.77 to $86.78. The monthly payment for a sample $10,000 loan at a range of 5.19% per year to 6.69% per year for a 20-year term would be from $67.05 to $75.68.
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the variable rate will decrease by 0.25%, and will increase back up to the regular variable interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.
3 Important Disclosures for SoFi.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
5 Important Disclosures for CommonBond.
Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown.
All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 2.28% effective October 10, 2018.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.47% – 6.99%3||Undergrad & Graduate|
|2.57% – 6.97%1||Undergrad & Graduate|
|2.51% – 8.09%4||Undergrad & Graduate|
|3.02% – 6.44%2||Undergrad & Graduate|
|2.50% – 7.24%5||Undergrad & Graduate|
|2.79% – 8.39%6||Undergrad & Graduate|