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Should You Make Student Loan Payments
While Still in School?

Make Student Loan Payments

Student loans have become an integral part of financing for higher education. But they’re also known for sticking around for a long time after students have received their diplomas. Making payments on your loan while still in school can help borrowers pay down their debts faster. 

But should you make student loan payments while still in school? 

Why Make Student Loan Payments While Still in School?

You might be wondering why you would consider making a student loan payment while still in school. The simple answer is that it can help reduce the amount you’ll have to pay back later on in a couple of ways. 

First of all, there’s the obvious benefit of any debt that’s paid off now won’t need to be repaid later. But this doesn’t really tell the full story of why one might choose to make student loan payments while still in school. To fully understand this, you have to dig into the differences between subsidized and unsubsidized loans. 

With a subsidized federal loan for undergraduates, the federal government covers interest payments while the student is in school and for the first six months after graduation. It’s important to know that these loans are only available to those who demonstrate financial need. Unsubsidized loans, on the other hand, don’t extend these same benefits. Interest accumulates the entire time you’re in school, and will be added on top of your original borrowed amount once you graduate. 

While it’s nice students can defer paying their interest on unsubsidized loans, doing this can land people with a larger amount of debt, which can in turn weigh you down for the long term. Those wanting to know how to pay off student loans fast should consider whether it makes sense to at least make interest payments while still in school—regardless of whether loans are subsidized or not. 

Who Should Pay Their Student Loans While Still in School?

Those with direct subsidized federal loans for undergraduates are pretty much the only group who will almost always want to hold off on paying loans until after graduation. For starters, these students have demonstrated financial need, which means money is likely tight already. Beyond that though, if you’re not accumulating interest while in school, allowing inflation to eat away at the real value of your debt over a few years isn’t a bad idea. If your cash is going to be worth more now than later, it makes sense to wait on paying your fixed-rate debt when possible.

Those who are accumulating interest while in school, however, should seriously consider whether it makes sense to pay on loans while still in school. This is particularly true if you have a high interest rate, or a variable rate that might climb later. When seeking out student loans for college, you want to find the best deals with the lowest interest rates. Borrowers can accomplish this by working with Juno, to negotiate with lenders to get the best deals on student loans. The median member is able to get a 1.6% lower interest rate, which will make a huge difference over time. Locking in a great deal can allow you to relax a bit when thinking about having to pay your loans while still in school. 

In addition to not having to sweat over your loans as much while you’re in school, getting a great interest rate on your loans will afford you more breathing room after graduation. It’s no secret that student loans can be like a weight around an individual’s neck when the terms aren’t great for the borrower. While high interest rates can be relieved with a student loan refinance, rather than being put in a position in which you might wind up asking what is refinancing later, it’s good a idea to get the best rate you can right off the bat and start paying it off as soon as possible.

A report from the Center for Responsible Lending found that “63 percent of student loan borrowers who made payments during the COVID-19 payment pause owe more than they originally borrowed.” This is significant because it shows the majority of people in this select group of borrowers, who actually made payments when it wasn’t required of them, have made no progress on paying down their loan. It should be clear why getting the right loan is more important than paying while still in school. 

Some students will benefit from making payments on their student loans while still in school. Though this isn’t for everyone, it’s good idea to determine whether you’re in a position to reduce what you owe before graduation. 


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