<\/p>\n
There are many kinds of debt that musicians will encounter throughout their lives. For 29 Days to Diva (#29daystodiva), we chose to mainly discuss student loan debt. There is a natural timeline for the course of student loan debt:<\/p>\n
<\/p>\n
![\"\"](\"http:\/\/sybariticsinger.files.wordpress.com\/2012\/02\/student_loan_d6f48c_f1.jpg\" "\\"Student_loan_d6f48c_f1\\"")
<\/a>Before College<\/h4>\n1. Choose Schools<\/h5>\n\nChoosing schools is important. Do you want the name recognition? Did you bond with a voice teacher there? Are there ample opportunities for performances and networking? Make sure you look at a handful of schools and select your favorites. Also take the time to think about what kind of budget you will be dealing with in the long run. Are you paying for it all by yourself? That might change how aggressively you will need to pursue scholarships or the institutions you apply to based on tuition amount. Once you have a few schools in mind, investigate ways to pay through various grants, scholarships, and loans. Contact the financial aid officers at those schools and ask them what you can do to make their institution the most affordable for you.<\/p>\n<\/div>\n
2. Submit a FAFSA<\/a><\/abbr><\/h5>\n\nTo qualify for student aid in the United States, you must complete the FAFSA (Free Application for Federal Student Aid). You can include on your FAFSA<\/abbr> up to six schools you are interested in attending. Find out the aid deadlines from these schools and submit the FAFSA<\/abbr> before the earliest one.<\/p>\n<\/div>\n3. Award Letters Arrive<\/h5>\n\nThe schools you include on your FAFSA<\/abbr> will send you their financial aid offer in a package, often referred to as an award letter. The aid offered in award letters will be different for each school, so review your award letters very carefully. Also review the dates for accepting awards or any additional work that must be done to accept the award.<\/p>\n<\/div>\n4. Fill Aid Gaps<\/h5>\nMost students are not able to cover the cost of tuition through grants and scholarships alone. If you can, dance a big happy dance and use those skills to stay out of other types of debt. Sit down with a parent or mentor and figure out the best options for students loans. Use careful foresight for your future. How much are you comfortable paying right away after undergrad and graduate school? Understand what you are signing when you agree to an educational loan. It will be with you for quite some time. Federal loans have lower interest rates than private ones and some loans do not accrue interest while you are in school which will dramatically lessen the overall cost of the loan.<\/div>\n<\/div>\n![\"\"](\"http:\/\/sybariticsinger.files.wordpress.com\/2011\/08\/college-education-is-the-debt-worth-it1.jpg?w=256\" "\\"college-education-is-the-debt-worth-it1\\"")
<\/a><\/h4>\n<\/h4>\nDuring College<\/h4>\n<\/div>\n
<\/p>\n
\n1. Know Your Responsibilities<\/h5>\nThis is probably the last thing on your mind while you are madly finishing papers, making friends, and going to rehearsals at all hours. However, organize all your loan materials in one place and collate all their terms, amounts, conditions, etc into a document for easy reference.<\/div>\n<\/div>\n<\/div>\n <\/p>\n
\n2. Pay Early<\/h5>\nThis may be impossible for many student musicians, but if you are able – every little bit helps.<\/div>\n<\/div>\n<\/div>\n <\/p>\n
\nAfter College<\/h4>\n
<\/p>\n
1. Enjoy Grace<\/h5>\n
<\/p>\n
\nThe purpose of the grace period is to give you time to find employment. During grace, you don’t need to make any payments on your student loans. Given the economy, do your best to find the highest paying gigs or jobs you can. Sock away some money for the shock of repayment. The Institute for College Access & Success reports, “Two-thirds of college seniors graduated with loans in 2010, and they carried an average of $25,250 in debt. They also faced the highest unemployment rate for young college graduates in recent history at 9.1%.”\u00b9<\/a><\/p>\nDo an in-depth review of all your loan files. Find the 800 numbers for each one so that you can immediately resolve any issues. Mark your calendar for the end of your grace period. Do not let this catch you off-guard. Try myeddebt.com to get a summary of your student loans in one place.<\/p>\n<\/div>\n
<\/p>\n
2. Repay Your Loan<\/h5>\n
<\/p>\n
Your loan servicers will communicate with you regarding your first payment. If you have trouble remembering your payment due dates, most servicers provide an automatic debit option – or, you could set-up an automatic payment in your online banking. Try to make more than the minimum payment on your loans. You will seem them dwindle much faster if you are actually effectively decreasing the principal amount with each payment.<\/div>\n <\/p>\n
<\/div>\n <\/p>\n
Try the snowball effect for paying off your loans:
\nYou will need to know the exact amount of each of your debts as well as their interest rates and minimum payments – which should be a breeze since you’ve already collated all of your loan materials. After you get this information you can make the list in either two forms:<\/div>\n <\/p>\n
\n\n- In order from lowest to highest amount.<\/li>\n
- In order from highest to lowest interest rate.<\/li>\n<\/ol>\n
There are two options to get the snowball effect: pay the highest interest rate debts first or pay the lowest amount debts first. The first version allows you to start regaining some monetary control of those loans with outlandish interest rates. (If the rates are truly outlandish, see ‘consolidating’ in the next section.) Paying the lowest amount debts may be more satisfying though. It will feel great to see one or more loans whittle away quickly. Try to evaluate how much you owe against the interest rate to see which plan is better.<\/p>\n<\/div>\n
<\/p>\n
3. Can’t Pay<\/h5>\n
<\/p>\n
\nDo not despair – but take action early! If you are going to have problems with your suggested repayment plan call a customer service representative and apply for a myriad of actions that will help ease the burden of student loan debt. Some solutions are available through most loan servicers.<\/p>\n
\n- Change Your Due Date.<\/strong>Make sure you have money in the bank when it’s time to pay your bill.\n
\n- Now that you know where all your money is being kept<\/a> and spending only on the things you love<\/em><\/a>, you should be better prepared to know when you will have money in your accounts to pay your bills.<\/li>\n<\/ul>\n<\/li>\n
- <\/em>Reduce Your Monthly Payments.<\/strong> The repayment plan<\/a> you choose affects the amount you pay each month. Many providers also offer Income-Based Repayment<\/a> options.<\/li>\n
- Postpone Payments.<\/strong> Find out if you qualify for a deferment or forbearance, which allows you to postpone monthly payments. Many musicians that go into teaching are eligible for these types of postponement.<\/li>\n
- Loan Consolidation.<\/strong> Combine one or more existing student loans into a single new loan. Consolidating<\/a> federal student loans may be a good strategy to lower monthly payments or to get out of default, but it is not always a good idea.<\/li>\n
- Loan Discharge and Loan Forgiveness.<\/strong> If you meet the eligibility criteria for loan discharge or forgiveness, your loan balance will be paid for you. Those in fields of public service <\/a>are eligible for these types of programs.<\/li>\n<\/ul>\n<\/div>\n
<\/p>\n
4. The Final Payment<\/h5>\n
<\/p>\n
You made it! Do an even bigger happy dance than those that didn’t have to take out loans – because you’ve made it through one hell of a process.<\/p>\n
<\/p>\n
![\"\"](\"http:\/\/sybariticsinger.files.wordpress.com\/2012\/02\/debt.gif?w=222\" "\\"debt\\"")
<\/a>Absolute no-nos:<\/h3>\n <\/p>\n
Default<\/h5>\n
<\/p>\n
If you do not have a deferment or forbearance and you don’t make any loan payments for 270 days on a federal loan or 120 days on an alternative loan (although it may be more or less, depending on the lender), your lender\/loan servicer will take steps to place the loan in default. Don’t let this happen!<\/strong>
\nDefault can have devastating consequences:<\/p>\n\n- You will incur collection costs (including attorney fees) of up to 25%.<\/li>\n
- Your entire loan balance (and any collection costs) is immediately due in full.<\/li>\n
- The government may keep your income tax refund and apply it toward your loan debt.<\/li>\n
- Your employer may be legally obligated to forward 15% of your salary toward repayment of your loan.<\/li>\n
- Federal debt collection procedures may be taken against you.<\/li>\n
- You will damage your credit rating (default stays on your credit report for up to 7 years).<\/li>\n
- You may lose your professional license.<\/li>\n
- You will no longer be eligible for financial aid, including loans and grants.<\/li>\n
- You will no longer be eligible for deferments of any type.<\/li>\n
- The interest rate on your loan may increase.<\/li>\n<\/ul>\n
Choosing schools is important. Do you want the name recognition? Did you bond with a voice teacher there? Are there ample opportunities for performances and networking? Make sure you look at a handful of schools and select your favorites. Also take the time to think about what kind of budget you will be dealing with in the long run. Are you paying for it all by yourself? That might change how aggressively you will need to pursue scholarships or the institutions you apply to based on tuition amount. Once you have a few schools in mind, investigate ways to pay through various grants, scholarships, and loans. Contact the financial aid officers at those schools and ask them what you can do to make their institution the most affordable for you.<\/p>\n<\/div>\n
2. Submit a FAFSA<\/a><\/abbr><\/h5>\n\nTo qualify for student aid in the United States, you must complete the FAFSA (Free Application for Federal Student Aid). You can include on your FAFSA<\/abbr> up to six schools you are interested in attending. Find out the aid deadlines from these schools and submit the FAFSA<\/abbr> before the earliest one.<\/p>\n<\/div>\n3. Award Letters Arrive<\/h5>\n\nThe schools you include on your FAFSA<\/abbr> will send you their financial aid offer in a package, often referred to as an award letter. The aid offered in award letters will be different for each school, so review your award letters very carefully. Also review the dates for accepting awards or any additional work that must be done to accept the award.<\/p>\n<\/div>\n4. Fill Aid Gaps<\/h5>\nMost students are not able to cover the cost of tuition through grants and scholarships alone. If you can, dance a big happy dance and use those skills to stay out of other types of debt. Sit down with a parent or mentor and figure out the best options for students loans. Use careful foresight for your future. How much are you comfortable paying right away after undergrad and graduate school? Understand what you are signing when you agree to an educational loan. It will be with you for quite some time. Federal loans have lower interest rates than private ones and some loans do not accrue interest while you are in school which will dramatically lessen the overall cost of the loan.<\/div>\n<\/div>\n<\/a><\/h4>\n<\/h4>\nDuring College<\/h4>\n<\/div>\n
<\/p>\n
\n1. Know Your Responsibilities<\/h5>\nThis is probably the last thing on your mind while you are madly finishing papers, making friends, and going to rehearsals at all hours. However, organize all your loan materials in one place and collate all their terms, amounts, conditions, etc into a document for easy reference.<\/div>\n<\/div>\n<\/div>\n <\/p>\n
\n2. Pay Early<\/h5>\nThis may be impossible for many student musicians, but if you are able – every little bit helps.<\/div>\n<\/div>\n<\/div>\n <\/p>\n
\nAfter College<\/h4>\n
<\/p>\n
1. Enjoy Grace<\/h5>\n
<\/p>\n
\nThe purpose of the grace period is to give you time to find employment. During grace, you don’t need to make any payments on your student loans. Given the economy, do your best to find the highest paying gigs or jobs you can. Sock away some money for the shock of repayment. The Institute for College Access & Success reports, “Two-thirds of college seniors graduated with loans in 2010, and they carried an average of $25,250 in debt. They also faced the highest unemployment rate for young college graduates in recent history at 9.1%.”\u00b9<\/a><\/p>\nDo an in-depth review of all your loan files. Find the 800 numbers for each one so that you can immediately resolve any issues. Mark your calendar for the end of your grace period. Do not let this catch you off-guard. Try myeddebt.com to get a summary of your student loans in one place.<\/p>\n<\/div>\n
<\/p>\n
2. Repay Your Loan<\/h5>\n
<\/p>\n
Your loan servicers will communicate with you regarding your first payment. If you have trouble remembering your payment due dates, most servicers provide an automatic debit option – or, you could set-up an automatic payment in your online banking. Try to make more than the minimum payment on your loans. You will seem them dwindle much faster if you are actually effectively decreasing the principal amount with each payment.<\/div>\n <\/p>\n
<\/div>\n <\/p>\n
Try the snowball effect for paying off your loans:
\nYou will need to know the exact amount of each of your debts as well as their interest rates and minimum payments – which should be a breeze since you’ve already collated all of your loan materials. After you get this information you can make the list in either two forms:<\/div>\n <\/p>\n
\n\n- In order from lowest to highest amount.<\/li>\n
- In order from highest to lowest interest rate.<\/li>\n<\/ol>\n
There are two options to get the snowball effect: pay the highest interest rate debts first or pay the lowest amount debts first. The first version allows you to start regaining some monetary control of those loans with outlandish interest rates. (If the rates are truly outlandish, see ‘consolidating’ in the next section.) Paying the lowest amount debts may be more satisfying though. It will feel great to see one or more loans whittle away quickly. Try to evaluate how much you owe against the interest rate to see which plan is better.<\/p>\n<\/div>\n
<\/p>\n
3. Can’t Pay<\/h5>\n
<\/p>\n
\nDo not despair – but take action early! If you are going to have problems with your suggested repayment plan call a customer service representative and apply for a myriad of actions that will help ease the burden of student loan debt. Some solutions are available through most loan servicers.<\/p>\n
\n- Change Your Due Date.<\/strong>Make sure you have money in the bank when it’s time to pay your bill.\n
\n- Now that you know where all your money is being kept<\/a> and spending only on the things you love<\/em><\/a>, you should be better prepared to know when you will have money in your accounts to pay your bills.<\/li>\n<\/ul>\n<\/li>\n
- <\/em>Reduce Your Monthly Payments.<\/strong> The repayment plan<\/a> you choose affects the amount you pay each month. Many providers also offer Income-Based Repayment<\/a> options.<\/li>\n
- Postpone Payments.<\/strong> Find out if you qualify for a deferment or forbearance, which allows you to postpone monthly payments. Many musicians that go into teaching are eligible for these types of postponement.<\/li>\n
- Loan Consolidation.<\/strong> Combine one or more existing student loans into a single new loan. Consolidating<\/a> federal student loans may be a good strategy to lower monthly payments or to get out of default, but it is not always a good idea.<\/li>\n
- Loan Discharge and Loan Forgiveness.<\/strong> If you meet the eligibility criteria for loan discharge or forgiveness, your loan balance will be paid for you. Those in fields of public service <\/a>are eligible for these types of programs.<\/li>\n<\/ul>\n<\/div>\n
<\/p>\n
4. The Final Payment<\/h5>\n
<\/p>\n
You made it! Do an even bigger happy dance than those that didn’t have to take out loans – because you’ve made it through one hell of a process.<\/p>\n
<\/p>\n
<\/a>Absolute no-nos:<\/h3>\n <\/p>\n
Default<\/h5>\n
<\/p>\n
If you do not have a deferment or forbearance and you don’t make any loan payments for 270 days on a federal loan or 120 days on an alternative loan (although it may be more or less, depending on the lender), your lender\/loan servicer will take steps to place the loan in default. Don’t let this happen!<\/strong>
\nDefault can have devastating consequences:<\/p>\n\n- You will incur collection costs (including attorney fees) of up to 25%.<\/li>\n
- Your entire loan balance (and any collection costs) is immediately due in full.<\/li>\n
- The government may keep your income tax refund and apply it toward your loan debt.<\/li>\n
- Your employer may be legally obligated to forward 15% of your salary toward repayment of your loan.<\/li>\n
- Federal debt collection procedures may be taken against you.<\/li>\n
- You will damage your credit rating (default stays on your credit report for up to 7 years).<\/li>\n
- You may lose your professional license.<\/li>\n
- You will no longer be eligible for financial aid, including loans and grants.<\/li>\n
- You will no longer be eligible for deferments of any type.<\/li>\n
- The interest rate on your loan may increase.<\/li>\n<\/ul>\n
To qualify for student aid in the United States, you must complete the FAFSA (Free Application for Federal Student Aid). You can include on your FAFSA<\/abbr> up to six schools you are interested in attending. Find out the aid deadlines from these schools and submit the FAFSA<\/abbr> before the earliest one.<\/p>\n<\/div>\n The schools you include on your FAFSA<\/abbr> will send you their financial aid offer in a package, often referred to as an award letter. The aid offered in award letters will be different for each school, so review your award letters very carefully. Also review the dates for accepting awards or any additional work that must be done to accept the award.<\/p>\n<\/div>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n The purpose of the grace period is to give you time to find employment. During grace, you don’t need to make any payments on your student loans. Given the economy, do your best to find the highest paying gigs or jobs you can. Sock away some money for the shock of repayment. The Institute for College Access & Success reports, “Two-thirds of college seniors graduated with loans in 2010, and they carried an average of $25,250 in debt. They also faced the highest unemployment rate for young college graduates in recent history at 9.1%.”\u00b9<\/a><\/p>\n Do an in-depth review of all your loan files. Find the 800 numbers for each one so that you can immediately resolve any issues. Mark your calendar for the end of your grace period. Do not let this catch you off-guard. Try myeddebt.com to get a summary of your student loans in one place.<\/p>\n<\/div>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n <\/p>\n There are two options to get the snowball effect: pay the highest interest rate debts first or pay the lowest amount debts first. The first version allows you to start regaining some monetary control of those loans with outlandish interest rates. (If the rates are truly outlandish, see ‘consolidating’ in the next section.) Paying the lowest amount debts may be more satisfying though. It will feel great to see one or more loans whittle away quickly. Try to evaluate how much you owe against the interest rate to see which plan is better.<\/p>\n<\/div>\n <\/p>\n <\/p>\n Do not despair – but take action early! If you are going to have problems with your suggested repayment plan call a customer service representative and apply for a myriad of actions that will help ease the burden of student loan debt. Some solutions are available through most loan servicers.<\/p>\n <\/p>\n <\/p>\n You made it! Do an even bigger happy dance than those that didn’t have to take out loans – because you’ve made it through one hell of a process.<\/p>\n <\/p>\n <\/p>\n <\/p>\n If you do not have a deferment or forbearance and you don’t make any loan payments for 270 days on a federal loan or 120 days on an alternative loan (although it may be more or less, depending on the lender), your lender\/loan servicer will take steps to place the loan in default. Don’t let this happen!<\/strong>3. Award Letters Arrive<\/h5>\n
4. Fill Aid Gaps<\/h5>\n
<\/a><\/h4>\n<\/h4>\n
During College<\/h4>\n<\/div>\n
1. Know Your Responsibilities<\/h5>\n
2. Pay Early<\/h5>\n
\nAfter College<\/h4>\n
1. Enjoy Grace<\/h5>\n
2. Repay Your Loan<\/h5>\n
\nYou will need to know the exact amount of each of your debts as well as their interest rates and minimum payments – which should be a breeze since you’ve already collated all of your loan materials. After you get this information you can make the list in either two forms:<\/div>\n\n
3. Can’t Pay<\/h5>\n
\n
\n
4. The Final Payment<\/h5>\n
<\/a>Absolute no-nos:<\/h3>\nDefault<\/h5>\n
\nDefault can have devastating consequences:<\/p>\n\n