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Money Management

As a college student, your primary goal is receiving a degree from Illinois Tech. Because a college education is expensive, it is vital to focus on your finances throughout your college years. Moreover, students using loans to finance their education need to make certain they are prepared to manage their student loans after their time on campus.

Use the resources below to help guide your financial decisions.

Reducing Future Loan Payments

Below are some optional ways you may consider to assist in reducing your future loan payments once you have completed your education.

Smaller Loan Payments

A small change in the amount a student borrows can result in significant savings a couple of years down the road. The example below highlights the value of reduced borrowing.

Illinois Tech first-year student Fernando is deciding between accepting $5,000 in a Subsidized Stafford Loan or accepting $4,000 in a Subsidized Stafford Loan and working a student job to supplement the difference. His interest rate is 5% and he plans to pay his loan off over the course of 10 years.*

 PrincipalTotal InterestTotal Payment
With Student Job ($1,000 in income) $4,000.00 $1,091.60 $5,091.60
Without Student Job $5,000.00 $1,363.60 $6,363.60

*Interest on Stafford Loans varies annually.

In both options, Fernando had $5,000 to supplement his expenses. However, the first option saves Fernando $1,272 in the long run. Be certain to consider this information, especially over the course of four years of borrowing. The chart below shows what Fernando’s total payments would look like after four years of borrowing:

 PrincipalTotal InterestTotal Payment
With Student Job ($1,000 in income) $16,000.00 $4,364.00 $20,364.00
Without Student Job $20,000.00 $5,455.60 $25,455.60

If Fernando chooses to work for $1,000 each year, he saves $5,091.60 in future loan payments. Not bad!

If you want to research your expected monthly payments, visit the Tips and Tools section of our Money Management page.

Reducing Unsubsidized Loan Interest While Enrolled

The government begins charging interest on unsubsidized loans as soon as they disburse to your account. This interest can be paid while a student is in school, or it can be capitalized. Capitalizing allows a student to defer the payment of interest while enrolled in classes. Capitalized interest will increase your principal, which consequently increases your monthly loan payments as well as the total amount of money you repay to your loan lender.

Loan Consolidation

There may be advantages to consolidating (combining) your Federal Direct Student Loans into one loan. For example, students who consolidate their Federal Direct Student Loans only need to make a single monthly payment. Consolidation generally extends the repayment period, resulting in a lower monthly payment. This may make it easier for you to repay your loans. However, you will pay more interest if you extend your repayment period through consolidation since you will be making payments for a longer period of time. The Department of Education has additional information on loan consolidation if you’d like more details.

National Foundation for Credit Counseling (NFCC)

The NFCC is a national nonprofit network of 1,450 Neighborhood Financial Care Centers designed to provide assistance to people dealing with stressful financial situations.

National Student Loan Data System (NSLDS)

NSLDS provides an overview of any federal student loans received during your time as a student. NSLDS also lists the servicer of your Federal Student Loans.

Repayment Calculator

The Department of Education’s repayment calculator provides estimated repayment information for different repayment plans available to those with Federal Student Loans. Your loan servicer will determine your eligibility for the repayment plans listed on this website.