The Live Life Smart Guide - Nelnet

Live Life Smart Guide

Helpful Tips to Manage Your Student Loans

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EDUCATION LOAN SERVICING

Table Of Contents

Introduction 3 The Life of a Student Loan4

Financial Literacy Managing Your Money 6 Set Your Financial Goals 7 Budget Worksheet 8 Strategies to Save Money 9 Credit Card Tips 10 How to Avoid Identity Theft 11

Loan Repayment Federal Student Loan Programs 13 10 Things You Should Know About Student Loans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Student Loan Repayment Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16 Income-Driven Repayment Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18 Loan Repayment Estimates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Student Loan Terms to Know. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Default Management How to Avoid Delinquency and Default on Your Student Loans29 Trouble Making Payments? 30 Four Easy Ways to Avoid Delinquency or Default on Your Student Loans31

Leaving School Get Ready for Repayment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 Servicer Contact Info34 Entrance Counseling 35 Exit Counseling36

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EDUCATION LOAN SERVICING

Introduction

Congratulations on your decision to pursue a higher education! Upon completion, this can significantly boost your earning potential. To help you build a healthy financial future, we want to provide any information we can to balance your educational goals with good borrowing decisions. In combination, this guide and careful financial planning can help you set up your finances for success. When you borrow federal student loans, you have six months (a loan's grace period) from the time you graduate or drop below half-time student status until you are required to start making payments (repayment). Nelnet is one of the federal student loan servicers who may process your student loan payments and answer your questions on behalf of the U.S. Department of Education. Our years of experience in the student loan and financial industries have given us a wealth of knowledge that we want to share with you to help you be in the best possible financial position.

How to Live Life Smart:

? Use this document to learn how to set a budget, pick a repayment plan, and more. ? If Nelnet is one of your servicers, create or log in to your account to update your contact information and

view account information including due dates, payment amounts, and repayment options. ? Review your Repayment Schedule that will be available in your account after the third month of your

loan's grace period (this is not a bill; it contains details about your federal student loans). ? Get the details on all of your federal student loans online through the U.S. Department of Education's National

Student Loan Data System (NSLDS) at NSLDS.. ? Review your monthly student loan billing statements. If Nelnet is one of your servicers, your Nelnet monthly billing

statement is sent about three weeks before your payment is due. You can choose to receive electronic or paper statements at .

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EDUCATION LOAN SERVICING

The Life of a Student Loan

This may be your first time filling out the FAFSATM and terms like "loan servicer" may be new to you. Don't stress, here's a chart that explains the process of student loans, scholarships, and repayment.

STEP 1: PLANNING FOR SCHOOL

If, in addition to scholarships and grants, you need federal student aid to help pay for college, you will have to fill out the Free Application for Federal Student Aid (FAFSA) at .

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STEP 2: THE AWARDING PROCESS

Based on your FAFSA, your school's financial aid office will decide how much aid to award you, and the U.S. Department of Education will then disburse these funds.

When funds are disbursed, they will be sent directly to your school to cover educational costs.

A

C

B

D

LOAN SERVICERS

STEP 3: WHILE YOU'RE IN SCHOOL

If federal student loans are part of your award, the Department of Education will assign your loans to a student loan servicer after they are disbursed.

Loan servicers help you manage your student loans from disbursement to payoff. To learn more about the life of your loans, visit Stages-Of-A-Student-Loan.

STEP 4: AFTER SCHOOL AND BEYOND

When you graduate or drop below a half-time enrollment status, you are not required to make payments on your federal student loans for six months. However, you can choose to start paying down your loans early. This will save you money in the long run.

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Throughout your repayment period, your student loan servicer will help you choose the repayment plan that's right for you. Whether you have questions about your loans or are struggling to make payments, let your servicer know ? we're here to help!

EDUCATION LOAN SERVICING

Financial Literacy

Resources and Tips to Help you Get

(and Stay) Financially Stable

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EDUCATION LOAN SERVICING

Managing Your Money: Nine Tips to Achieving Financial Wellness

1. Know Where Your Money Goes

Be aware of how you are spending your money. A $5 cup of coffee five days a week costs you $100/month. Review items you spend your money on to find areas where cutting back can grow your savings account.

2. Develop a Budget

Plan for your spending by developing a budget and live within your means based on your monthly income. Make adjustments to remain within your budget, and don't use a credit card to cover a shortfall or unnecessary purchases.

3. Include Savings in Your Budget

Pay yourself first. Treat your savings account like any other monthly bill by making a monthly payment toward it.

4. Plan for Major Purchases

Adjust your budget accordingly to build savings for your next major purchase without using credit.

5. Save for Emergencies

A good plan is to have a minimum of six months salary available in your savings account. While this goal will take time to achieve, it is important to strive for it so you're prepared for most unexpected emergencies.

6. Plan for Retirement

Take advantage of interest and market upturns by saving for retirement early. Often your employer will help you save for retirement with a 401(k) plan. You can also benefit from pre-tax contributions using this method of retirement savings.

7. Get Tax Advice

If you have circumstances that create tax dilemmas (i.e., self-employed, own and/or lease property, etc.), make sure to seek tax advice from a professional for the best outcome.

8. Protect Your Credit

You have the right to pull a free credit report from each credit reporting agency once per year at . Keep in mind that late payments will adversely impact your credit, as will a failure to pay. You should immediately report any credit issues or discrepancies to the credit reporting agency. Use your credit wisely and ensure your reports are accurate.

9. Keep Good Financial Records

Use online tools as well as paper copies of receipts to keep records of your pay stubs, banking information, taxes, insurance, and other documents important to your financial situation.

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EDUCATION LOAN SERVICING

Set Your Financial Goals

Healthy financial habits start by setting sound financial goals. Develop a realistic path to achieving your goals by filling in the chart below.

General Information

Monthly Household Net (After Taxes) Income: Monthly Necessary Expenses: Amount Remaining to Save for Goals:

Number of Dependents: Your Age: Expected Graduation Date:

Identify goals, cost, timeline, savings method, and anticipated rate of return.

Set your goals

Total cost of each goal Current funds available Time needed to achieve each goal Monthly contribution to achieve goal Funding source for monthly contribution Method for saving/investing for goal Expected interest rate/rate of return

Goal #1:

Goal #2:

Goal #3:

There could be risks that might keep you from reaching your goals. In many cases, insurance can help protect against these risks.

Risks: Identify risks below that could keep

you from reaching your goals and then check

the boxes for any insurance you have that can

Life

protect you from each risk.

$

Type of Insurance With Monthly Cost

Health $

Disability $

Auto $

Home/Renters

$

$

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EDUCATION LOAN SERVICING

Budget Worksheet

It's easy to prepare a budget. Common categories are included in this worksheet ? just fill in the amount you typically spend in the Budget column. Use the Actual column to record spending to see if your budget is on target or needs to be adjusted. Check your billing statements and receipts for the most accurate numbers.

Monthly Expenses

Deductions Savings (to be set aside) Child Support/Alimony Other: Housing Rent/Mortgage Payment Utilities (e.g. Gas, Water, Electric) Home Insurance and Taxes Home Owner's Association Fees Cable/Satellite/Streaming Service Internet Phone Other: Debt Payment Credit Card Payments Student Loans Other: Food Groceries Dining Out/Fast Food Campus Meal Plan Other: Transportation Car Payment License and Registration Gas/Oil Normal Car Maintenance Public Transit, Parking, Toll Other: Family Day Care/Babysitting Activities/Lessons Pet Sitting Other:

Budget

Actual

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

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$

$

$

$

$

$

$

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$

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$

$

$

$

$

$

$

$

Monthly Expenses

Personal and Health Clothing Personal/Care Products Haircuts Monthly Dues/Fees Insurance (Health, Life) Doctor/Dentist Visits Prescriptions/OTC Drugs Laundry/Dry Cleaning Other: Education Tuition Books/Fees Supplies Other: Entertainment Concerts/Movies Sporting Events Sports/Recreation Equipment Music, Streaming Services, Video Games Other: Miscellaneous/Unexpected Gifts/Charity Pet Supplies/Vet Traffic Ticket Car Repair Home Repair/Improvement Entertaining Guests Other: Monthly Net Income = Monthly Spendable Income - Total Expenses (from above)

Budget

$ $ $ $ $ $ $ $ $

$ $ $ $

$ $ $ $ $

$ $ $ $ $ $ $ $ $ $

Actual

$ $ $ $ $ $ $ $ $

$ $ $ $

$ $ $ $ $

$ $ $ $ $ $ $ $ $ $

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EDUCATION LOAN SERVICING

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