Recent Graduate Guide to Student Loan Repayment

Graduating with student loans? Here's everything you need to know to manage your debt effectively from day one.

Understanding Your Grace Period

What Is the Grace Period?

Federal loans: 6-month period after graduation before first payment due

• Purpose: Time to find employment and get financially settled
• Interest accrual: Varies by loan type

Grace Period by Loan Type

Choosing Your First Repayment Plan

Standard 10-Year Repayment

Best for: Graduates with good jobs and low debt-to-income ratio

• Pros: Fastest payoff, least interest
• Cons: High payments, less flexibility

Income-Driven Repayment (IDR)

Best for: High debt-to-income ratio or uncertain employment

• Pros: Payments based on income, forgiveness option
• Cons: Longer repayment, possible taxation

Action Checklist

Before Graduation

• [ ] Exit counseling (required)
• [ ] Understand all loan types
• [ ] Know grace period length
• [ ] Set up StudentAid.gov account

Month 1-2 of Grace Period

• [ ] Choose repayment plan
• [ ] Set up autopay discount
• [ ] Create budget with loan payments
• [ ] Check PSLF eligibility

Bottom Line

Default plan: Choose based on debt-to-income ratio

• Low ratio (<1): Standard repayment
• High ratio (>1.5): IDR plan
• Public service: IDR + PSLF

Most important:

• Never miss payments
• Choose right plan early
• Reassess as income changes

Start planning before grace period ends. The right repayment strategy saves thousands over the life of your loans.

Calculate your payments: Use our Payment Calculator to compare repayment options, or IDR Calculator to see income-driven plans.