4 Ways to Prepare for the End of Your Student Loan Grace Period

4 Ways to Prepare for the End of Your Student Loan Grace Period

If you've recently graduated from college, you're either busy looking for your first job or settling into the working world. But whether you're sending out résumés; or finding the best tacos within walking distance from your office, in the back of your mind you may be thinking about how soon you'll have to start repaying your student loans.

Worrying about your grace period ending for your undergraduate loans is normal — six months after graduation is not a long time for college graduates to prepare to start making student loan payments. Here are some tips to create a solid plan to conquer your student loans.

1. Learn About Your Loans

Many graduates have multiple student loans and keeping track of them can be confusing. Create a spreadsheet that details how much you owe on each, who is the loan servicer, how much interest you're being charged and how much your monthly payments will be.

Ensure that you never miss a payment by creating reminders in your phone or signing up for autopay. As a bonus for using auto pay during repayment, most loan servicers give you a quarter percent discount on your loan.

2. Find a Job

If you haven't already landed your first job, that's okay. The job market is competitive and it can be difficult to find something right away. The important thing is to keep trying and, possibly, to change your approach.

If your résumé hasn't been getting the attention it deserves, redesign it. It could pay to be creative. One recent grad scored 10 interviews when he delivered his résumé in a box of donuts. While you don't have to resort to baked goods, freshening up your résuméor customizing it to the requirements of each job posting will help.

Another method of scoring your first job is to hobnob with people from your industry. Go to networking events and let people know you're looking for a job. Bring business cards so they can easily connect with you later. If you make a good impression, they'll let you know if they hear of an opportunity.

Do you feel like you've delivered all the baked goods that the local coffee shop could make and shaken the hands of every person in your field within a 50-mile radius? You might want to expand your job search. That could mean looking for positions in different cities or looking for jobs that would allow you to use your degree in ways you haven't yet considered. Your college's career center — a great resource generally — might be able to help by telling you how other graduates are using their degrees.

3. Add Your Loan to Your Budget Now

You might be tempted to spend your paycheck on new clothes or going out with friends, but making room in your budget now for your student loan payment will allow you to get used to living within your means. Set up an automatic transfer from your checking account into a savings account each month for an amount equivalent to what your loan repayment will be after your grace period is over. This way you make it a priority to set aside that money. Alternatively, you could use some of this cash to pay the interest on your student loans that accumulates during your grace period so your debt doesn't continue to grow.

Even if can't set aside the full amount yet, saving a little bit from each paycheck will help you get ready to make payments.

4. Create an Emergency Fund

The last thing that you need is to have to choose between fixing your car and repaying your student loans. Having an emergency fund so that you'll never be stressed about making your payments. The money you are already putting aside from each paycheck is a good start to an emergency fund. Once you start making student loan payments, try to continue to put some of your paycheck into savings each month. A good emergency fund has about three to six months of income saved.