Manage Student Debt FAQ

With federal student loan rates at 5-7%, compare to expected investment returns. If loans are >6%, prioritize payoff. If <5%, consider investing. Always get employer 401k match first. Use our calculator to compare scenarios based on your specific rates and investment timeline.

Popular options include TurboTax, H&R Block, TaxAct, and FreeTaxUSA. Many offer free filing for simple returns. Consider professional help if you have complex situations like self-employment, rental property, or significant investments. IRS Free File is available for incomes under $79,000.

Maximize deductions and credits: contribute to retirement accounts, claim all eligible credits (Child Tax Credit, EITC, education credits), keep receipts for charitable donations, and consider timing of medical expenses. However, a large refund means you overpaid - adjust withholdings for next year.

With federal student loan rates at 5-7%, compare to expected investment returns. If loans are >6%, prioritize payoff. If <5%, consider investing. Always get employer 401k match first. Use our calculator to compare scenarios based on your specific rates and investment timeline.

The deadline to file 2024 taxes is April 15, 2025. If you need more time, you can request an extension until October 15, but you must pay any taxes owed by April 15 to avoid penalties. File early if expecting a refund.

If you can't pay, still file your return on time to avoid failure-to-file penalties. The IRS offers installment plans and offers in compromise. Penalties for not paying are lower than penalties for not filing.

Follow the 1x rule: total student debt shouldn't exceed your expected first-year salary. For example, if you expect to earn $50,000, limit total debt to $50,000. Monthly payments should stay under 10% of gross income to maintain financial flexibility.

Federal loans offer: fixed rates, income-driven repayment, forbearance options, potential forgiveness programs. Private loans typically have: variable rates, fewer repayment options, no forgiveness programs, but sometimes lower rates for excellent credit. Always exhaust federal options first.

Compare loan interest rates to expected investment returns. If loans are >6% interest, payoff may be prioritized. If <4% interest, investing might be considered. For 4-6% rates, it depends on risk tolerance and other financial goals. Employer 401k match is typically prioritized first.

Federal programs that cap payments at 10-20% of discretionary income: IBR (15% old loans, 10% new), PAYE (10%), REPAYE (10%), ICR (20%). Remaining balance forgiven after 20-25 years, but forgiven amount may be taxable. Good for low income relative to debt.

Consolidation (federal): Combines multiple federal loans, keeps federal benefits, but may increase rate. Refinancing (private): Can lower rates but loses federal protections. Refinancing typically makes sense with 1%+ rate reduction when federal benefits aren't needed.

PSLF forgives remaining federal loan balance after 120 qualifying payments while working full-time for qualifying employers (government, 501c3 nonprofits). Must be on income-driven repayment plan. Submit annual employment certification to track progress.

Options include: 1) Income-driven repayment plans, 2) Deferment/forbearance (temporary), 3) Loan rehabilitation (for defaulted loans), 4) Consolidation. Contact your servicer immediately - ignoring the problem leads to default with serious consequences for credit and finances.

Consider career field and earning potential. High-ROI fields (engineering, healthcare, finance) often justify higher debt. Low-ROI fields may not. Evaluate: total program cost, expected salary, job market, alternative paths. Community college + transfer can reduce costs significantly.