Saving During Student Loan Repayment

Written by Assistant Director, USFSCO - University of Illinois Saves | August 9, 2019

Over 44 million people hold $1.56 trillion in student loan debt. 11.4% of those borrowers are in delinquency or default

Forbes also outlined many more statistics about student loan debt in February 2019.

According to MeasureOne, private student loans make up an estimated 7.71% of the total outstanding student loan debt, so the vast majority of student loan debt is federal.

If you’re one of 17.8 million people in repayment or the 7.4 million currently in school, these can seem like very scary statistics. 

The important thing to remember is that there are a lot of ways to help federal loan borrowers avoid delinquency and default and even save some money. Here are a few:

    • Pay on time – Making payments on time will save you from a lot of credit report heartaches in the future, so know your servicer(s) and communicate with them ASAP if you run into problems.
    • Pay automatically – Signing up for ACH (direct deposit) payments with your loan servicer can get you a 0.25% deduction on your interest rate (in addition to ensuring your payments are being made on time).
    • Pay more than required – If you’re able, paying even $5 or $10 extra towards your principle can reduce your overall debt faster; you can use tools like to help you plan a debt snowball for student loans along with other types of debt.


  • Explore repayment plans – If you’re looking for ways to lessen the load of your monthly payment(s), you can use the Repayment Estimator to compare payment plans, including which ones would help you optimize Public Service Loan Forgiveness if you are qualified.


  • Know your options -  If you can’t make a payment, work with your loan servicer to enroll in a different repayment plan, deferment, or forebearance; if you choose deferment or forebearance, interest will likely continue to accrue on your student loans and be capitalized, so think about those as a last resort if you can to avoid an increase in your overall debt.
  • Remember your rights – You don’t have to pay for help on student loan issues. Even if you’ve defaulted on your loan, you have rights. Report bad student loan servicers to the CFPB. Report student loan debt relief scams to the FTC

Legislation related to student loans can change regularly. Luckily, federal student loan borrowers are typically grandfathered into the options that were available when they took out their loans. If changes occur that could impact your eligibility, make sure to review the fine print on things like Public Service Loan Forgiveness or alternative repayment plans.


Written by:

Andrea Pellegrini
Assistant Director, USFSCO Student Money Management Center
University of Illinois System

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