When people talk about traveling the world, they talk about the rich experiences and ways you can benefit from adventures abroad – but most people forget to mention all the planning and preparation associated with it.
Student loans are a concern for the majority of recent college graduates, which make up the bulk of our AYC cohort. I know many people who come to China so focused on paying their loans that they limit themselves from actually experiencing all that they could. Although the AYC program cannot directly provide student loan advice, we want to share some possible options to maximize your experience without having to sacrifice anything at the hands of your student loan debt:
1. Income-Driven Repayment (IDR) Plans
Many federal loans are eligible for a repayment plan based on your income. These kinds of plans are designed to set your monthly payment to an amount that is affordable based on the amount of money you earn and other circumstances. If you are not currently on an IDR plan, you will need to submit an application to be considered. You’ll be asked to provide financial ( read tax) and personal information along with your Federal Student Aid (FSA) ID (most people complete the application in less than 10 minutes!)
2. Deferment
In certain cases, your loan provider may be able to offer you a temporary stop or temporary reduction on your payments called a deferment. For some loans, you may not be responsible for paying interest during your period of deferment. Most people will need to submit a request directly their loan provider for a deferment and it will be decided on a case-by-case basis.
3. Forbearance
Forbearance offers a similar temporary stop or reduction on your loan payments, but the main difference is that you are generally responsible for paying the interest that accrues during that period of time.
Although the links here for information on deferment and forbearance are to the Federal Student Aid website, private loan servicers often offer these options as well. AYC can assist in providing documentation of your acceptance into the program and monthly salary, if required.
These options can make a big difference for those with student loan debt. Contact your loan provider directly for more information on their specific offerings to make your repayment plan affordable while part of AYC. Don’t let the game of loans prevent you from having a great year teaching and exploring China!