Rocky Ridge residents fight lease with homeowners association

On Friday, the stipulations and guidelines of Rocky Ridge Estate’s new 44-page lease were planned to go into effect.About 50 residents of the 89-lot Middle Smithfield Township mobile home community spent the day discussing what more can be done to fight those guidelines.The concerned residents gathered in the township municipal building Friday evening to plan a homeowners association for the estate.Signed agreements to the lease guidelines were originally to be [...]

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Inspiration from Jacob Frey, Dale Carnegie, Marcus Aurelius, and More

Once a month (or so), I share a dozen things that have inspired me to greater personal, professional, and financial success in my life. I hope they bring similar success to your life.

1. Marcus Aurelius and the power of your mind

“You have power over your mind, not outside events. Realize this, and you will find strength.” — Marcus Aurelius

I touched on Marcus Aurelius earlier this week during my article about the value of stoicism in personal finance, but I really wanted to highlight this quote because it sums up very quickly what I find valuable about stoicism.

The truth is that most of the challenges in our lives are made drastically harder or drastically easier just because of the way we think about it. Do we react with fear? Do we decide that something is just too difficult? Do we get distracted by the shiny new thing (whatever that happens to be)?

The real power you have in this world exists inside your head. It’s your capacity to control fear, to control your likes and dislikes, to give yourself courage. You make the decision as to whether to have fortitude, to stand up to challenges, to have a strong work ethic. Those things are your choices, no one else’s. Your success in life has a lot to do with what you choose regarding those things.

2. Neil Pasricha on “the three A’s of awesome”

So, what are these three As?

Attitude is simply your way of thinking about or behaving toward something. You control your attitude in that you choose how to think about and how to behave toward things in your life – people, places, activities, and so on. A positive attitude is one that acts positively toward the people and things around them and generally makes a person feel better about life and engages the people around them.

Awareness is your knowledge and perception of the world around you. It’s all about paying attention to what’s happening in the moment and devoting yourself to learning about the world.

Authenticity is revealing your true self to the world rather than covering it up. Don’t be afraid to be yourself and to be different from the crowd in some ways.

When you combine those three things, you end up with a mix of traits that people want to be around.

This really is a great talk, well worth listening to on your drive to work. It gears you up to take care of life’s challenges.

3. Paulo Coelho on today

“One day you will wake up and there won’t be any more time to do the things you’ve always wanted. Do it now.” – Paulo Coelho

I live by this every day. A day does not feel joyful or complete if I’m not doing things that are truly in line with what I want to be doing in life – writing, learning, building relationships.

I don’t like to ever end a day without doing something that feels meaningful in my life, whether it’s a chunk of genuine quality time with my children or pushing my brain to learn something new or doing something I’ve never tried before.

The only problem is that my list of “things I’ve always wanted to do” is longer than I’ll have the time to achieve in my lifetime.

4. Baz Luhrmann – Everybody’s Free to Wear Sunscreen

In this video, director Baz Luhrmann takes the words of a column of great life advice by Mary Schmich, a columnist with the Chicago Tribune, and puts it over a gentle musical beat, saying the words rhythmically and pairing them with colorful imagery.

Here’s a major excerpt that column:

Enjoy the power and beauty of your youth. Oh, never mind. You will not understand the power and beauty of your youth until they’ve faded. But trust me, in 20 years, you’ll look back at photos of yourself and recall in a way you can’t grasp now how much possibility lay before you and how fabulous you really looked. You are not as fat as you imagine.

Don’t worry about the future. Or worry, but know that worrying is as effective as trying to solve an algebra equation by chewing bubble gum. The real troubles in your life are apt to be things that never crossed your worried mind, the kind that blindside you at 4 p.m. on some idle Tuesday.

Do one thing every day that scares you.

Sing.

Don’t be reckless with other people’s hearts. Don’t put up with people who are reckless with yours.

Floss.

Don’t waste your time on jealousy. Sometimes you’re ahead, sometimes you’re behind. The race is long and, in the end, it’s only with yourself.

Remember compliments you receive. Forget the insults. If you succeed in doing this, tell me how.

Keep your old love letters. Throw away your old bank statements.

Stretch.

Don’t feel guilty if you don’t know what you want to do with your life. The most interesting people I know didn’t know at 22 what they wanted to do with their lives. Some of the most interesting 40-year-olds I know still don’t.

Get plenty of calcium. Be kind to your knees. You’ll miss them when they’re gone.

Maybe you’ll marry, maybe you won’t. Maybe you’ll have children, maybe you won’t. Maybe you’ll divorce at 40, maybe you’ll dance the funky chicken on your 75th wedding anniversary. Whatever you do, don’t congratulate yourself too much, or berate yourself either. Your choices are half chance. So are everybody else’s.

Enjoy your body. Use it every way you can. Don’t be afraid of it or of what other people think of it. It’s the greatest instrument you’ll ever own.

Dance, even if you have nowhere to do it but your living room.

Read the directions, even if you don’t follow them.

Do not read beauty magazines. They will only make you feel ugly.

Get to know your parents. You never know when they’ll be gone for good. Be nice to your siblings. They’re your best link to your past and the people most likely to stick with you in the future.

Understand that friends come and go, but with a precious few you should hold on. Work hard to bridge the gaps in geography and lifestyle, because the older you get, the more you need the people who knew you when you were young.

Live in New York City once, but leave before it makes you hard. Live in Northern California once, but leave before it makes you soft. Travel.

Accept certain inalienable truths: Prices will rise. Politicians will philander. You, too, will get old. And when you do, you’ll fantasize that when you were young, prices were reasonable, politicians were noble and children respected their elders.

Respect your elders.

Don’t expect anyone else to support you. Maybe you have a trust fund. Maybe you’ll have a wealthy spouse. But you never know when either one might run out.

Don’t mess too much with your hair or by the time you’re 40 it will look 85.

Be careful whose advice you buy, but be patient with those who supply it. Advice is a form of nostalgia. Dispensing it is a way of fishing the past from the disposal, wiping it off, painting over the ugly parts and recycling it for more than it’s worth.

Great stuff, from beginning to end.

5. Charles Eisenstein on broken lives

“We are so broken that we dare not remember that it isn’t supposed to be this way.” – Charles Eisenstein

A friend of mine uses this as a signature on her emails. Maybe it’s a little melodramatic, but it does make a point.

Who among us hasn’t dreamed of a very different life? Why do medieval-themed fantasies like Lord of the Rings or Game of Thrones have such popularity? They’re all about escaping from the constraints of our modern lives.

Many, many aspects of our modern lives make it more convenient and easy to live a modern life, but quite often, that modern life is dissatisfying and those conveniences feel like shackles.

What’s the solution? There isn’t an easy one, unfortunately. Just remember that when life feels constrained, there’s often a good reason for each and every constraint.

6. Dan Pink on the surprising truth about what motivates us

The book Drive: The Surprising Truth About What Motivates Us is a really good read, one that contains a great deal of insight into why we do the things we do and what moves us to excel at some things and … not excel at others. Pink points out three main factors:

Autonomy is the freedom to make choices about how one spends their time and energy. The more restrictions that a person has on their ability to make their own choices about time and energy use, the less motivated they’re going to be to do their best.

Mastery is the skill strength that underlies the tasks that we have to do each day and whether the task at hand matches that skill strength. People that are given tasks that are far below their skill strength get bored, while people that are given tasks far above their skill strength get overwhelmed. The best place to ignite someone’s drive is right at their skill strength or slightly above it.

Purpose is whether or not the person believes in the virtue of the work being done. Is this work worthwhile, or is it just busywork? Purposeful work almost always engages people far better than busywork.

Part of what I love most about self-employment is that I have great autonomy and can use that autonomy to find work that challenges my mastery and has purpose. This makes me very, very happy with my work most of the time.

7. David Starr Jordan on wisdom, skill, and virtue

“Wisdom is knowing what to do next, skill is knowing how to do it, and virtue is doing it.” ― David Starr Jordan

I think these three attributes – wisdom, skill, and virtue – point a person toward success in virtually anything he or she might tackle, and it’s stated really wonderfully here.

I can feel these three attributes tugging at me whenever I am working on a project and aiming for great results.

What do I do next? That’s all about planning and having an organized list of tasks to take care of. Whenever I use tools for maintaining my tasks and organizing my things to get done and I actively use those tools, I tend to do much better work.

How do I do this? That’s about building skills you can rely on to take on more and more challenging tasks. Whenever I think about how to organize an article or how to write a good article in a very limited time space, I’m using my skill.

Am I actually doing it? All of the planning and skill in the world rots on the vine if you’re not actually following through and getting stuff done.

Wisdom. Skill. Virtue. Those are three pillars upon which success rests.

8. Albert Einstein on reading and thinking

“Any man who reads too much and uses his own brain too little falls into lazy habits of thinking.” – Albert Einstein

I’ve been a voracious reader all of my life, devouring somewhere between one to two books a week since I was in upper elementary school. One would think that I would shake my head and disagree with Einstein’s quote… but the truth is that I actually agree with this.

Getting lost in a book is a wonderful experience, but taking what you learned from the book and using it somewhere in the world is even more amazing. It shows that reading that book and thinking about what it offers between the covers is about far more than just entertainment. It’s about changing your life.

I can list hundreds of books that have changed the way I thought and behaved. Those are the books that have mattered and have stuck with me, not the books that were good just as a page turner or just as a brief exposure to an idea.

A good book changes you. It forces you to think differently, to exercise your brain. Without that… books kind of lose their magic for me.

9. The Public Domain Full Movies Youtube channel

This is a pretty healthy collection of movies that, for various reasons, have fallen into the public domain, which means that they can be viewed for free (and edited for free) without any concern about copyright or anything else. A few of my favorites:

Captain Kidd, a pirate movie from the mid-1940s:

Scarlet Street, a great forgotten noir film from the same timeframe starring Edward G. Robinson:

And, most of all, one of my five favorite black-and-white movies of all time, My Man Godfrey, a comedy-drama about the Great Depression, starring William Powell and Carole Lombard:

The channel is just loaded with all kinds of interesting and strange things and it’s well worth a browse.

10. Rufus Griscom on status symbols

“People are irrationally attracted to that which is scarce, because scarce things function as status symbols. If you understand the elements of human behavior that are irrational and predictable, you are freed from them and can benefit from the insight.” – Rufus Griscom

People wear gold bands and diamonds because they’re scarce, not because of something exceptional about them. People drive exotic cars and wear expensive clothes because they’re scarce, not because they’re of exceptional quality.

The thing is, much of the time scarcity really doesn’t hold any real practical value. It’s just different, and different doesn’t inherently mean better.

Don’t throw your financial future or your life’s future away chasing something merely because it’s scarce.

11. The Present

From the description:

After a very successful festival circuit, running on over 180 film festivals and winning more than 50 awards, we’ve decided that it’s finally time to share “The Present” with the rest of the world. “The Present” is a thesis short from the Institute of Animation, Visual Effects and Digital Postproduction at the Filmakademie Baden-Wuerttemberg in Ludwigsburg, Germany.

In summary, the student who created this film, Jacob Frey, did it as his thesis project and, needless to say, he utterly knocked it out of the park. Not surprisingly, he was hired almost immediately by Disney and now works for them as an animator and I’ve got to believe he’s got a long, bright future ahead of him in that field.

This is well, well worth your three minutes of time to watch.

12. Dale Carnegie on fear and inaction

“Inaction breeds doubt and fear. Action breeds confidence and courage. If you want to conquer fear, do not sit home and think about it. Go out and get busy.” -Dale Carnegie

Whenever we’re faced with a challenge, we have a choice. We can choose to take the bull by the horns and dive into that challenge… or we can wait.

Waiting might be useful in some situations to find out more information or look for a better opportunity or to talk yourself out of a potentially horrible choice, but at the same time, waiting has a big drawback. Once you put something back on the table, it becomes much more likely that you’ll never pick it up again.

Unless there’s a good reason not to do it – and your own baseless fears are not a good reason – then just do it. Take on that challenge, whatever it might be.

The post Inspiration from Jacob Frey, Dale Carnegie, Marcus Aurelius, and More appeared first on The Simple Dollar.

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You Got the Job, Now Get Paid: 8 Simple Steps to Negotiating Your Salary

Landing a job is hard enough.

After poring over your resume (and LinkedIn, and Facebook, and Twitter…) for hours, you’ve only scratched the surface.

You still have to pen a personalized cover letter, hope your name will float to the top of the slush pile and make not-too-eager-but-not-too-lax follow-up contact to encourage your resume’s buoyancy.

In the best case scenario, you’ll next undergo a stressful, and potentially lengthy, interview process. You might even have to travel.

So after all that, it’s a gigantic relief when your hiring manager makes an offer. You’ve got it! They want you.

And because (good) jobs are so precious, it feels way easier — and way safer — to just take the money and run.

But you’re doing yourself a serious disservice if you don’t negotiate.

Even if you only talk your hiring manager up by 5%, that’s still an instant 5% raise. If you took the job outright, you might have waited six months or longer for that pay increase, losing out on the extra income in the interim.

But it’s hard! And scary! And I don’t know how!

All that may be true. But you do want a better salary, right?

Time to bite the bullet and learn how to make an offer they can’t refuse.

Negotiation Skills: Yes, You Can!

It’s not just about the money you’re leaving on the table if you forego a hard conversation with your new boss.

Negotiation skills will help in all aspects of your life.

For instance, this guy split his San Francisco rent in half, and this family saved $5,000 on bills — all thanks to their savvy negotiation tactics.

You can also negotiate within a job you already have. This guy got himself a 45% raise by doing just that. You might also be able to land better benefits, a more flexible schedule or responsibilities that better suit your interests.

Even though it can be a little scary, negotiation is totally learnable — and practice makes perfect.

So we’re here to help you get a handle on this valuable skill.

Here’s the ultimate guide to negotiating your way to a better salary in eight achievable steps.

1. Actually Do It

Almost half of us take the first offer we get and skip negotiation entirely, according to a study by CareerBuilder.

The number of women who accept the first offer is slightly higher at 54%. Their reluctance, no matter its cause, is a huge factor in the gender pay gap.

Although it may not seem like much, the money you’re missing out on adds up.

Say you’re offered an entry-level job at $40,000, and you take it right off the bat. If you’d successfully negotiated a modest 10% raise, you’d have an extra $4,000 over the course of your first year.

That $4,000 probably means a lot more to you than it does to your company.

Plus, your subsequent raises will be based on your existing salary. The higher your salary starts out, the more quickly it will grow.

So if you’re staring down an intimidating conversation, crack your knuckles and get ready. It’s one worth having.

2. Know Your Work’s Worth

Check how much people in your new position actually make. You can quickly and easily use resources like Glassdoor to do this, so there’s no excuse not to be informed.

Try to find local averages as opposed to national ones. If you ask a Midwestern company for a New York salary — or a senior-level salary when negotiating an entry-level position — you might be in for a bad time.

Luckily, in many cases Glassdoor actually lists salary information down to specific roles in specific companies, so you’ll have a better understanding of how much you can reasonably expect.

Get familiar with these numbers as early as possible in the application process. They might keep you from shooting yourself in the foot.

“If you’ve already said you’re looking to make $50,000 and they offer you $50,000, it’s bad form to attempt to negotiate from there,” HR expert Suzanne Lucas told CBS.

So inform yourself before you fill in that “Desired Salary” box on the application, or you might find yourself locked into a lower rate than you could have gotten had you known better.

3. Have a Good Argument

If you’re asking a company for more compensation, you need to have some leverage. It’s easy for a company to invest in something it needs, but if you can’t explain why you should earn more, it’ll be a tough sell.

In fact, if you think your negotiation is gonna be rough, check out this college student who negotiated her way into a job that didn’t even exist before she pitched it.

A huge part of her success? Identifying and fixing tangible problems the company was experiencing, which proved her value as an employee.

Research your new company thoroughly and figure out its weak points. Then, apply your skill set to the company’s pain points in specific, actionable ways. Make yourself an asset the company can’t function without.

Maybe you notice the company’s blog could use some traffic. Good thing you have SEO training!

Would your proficiency with spreadsheets allow you to automate down the workload in your new department? Let your hiring manager know.

Knowing how your skills qualify you for your new position will also boost your confidence, and it’ll set you up for a much easier — and more successful — negotiation.

4. Look at the Whole Package

Salary is one thing.

But the very best part of working for someone else usually has more to do with the sideline benefits, which can offset pricy items you’d otherwise have to pay for yourself, like health care.

When you’re planning your negotiation, make sure you keep your whole compensation package in mind. What’s its monetary value — and what’s most important to you?

If you’re missing out on something you’d really like to have, it might give you more motivation to negotiate aggressively.

Or if there’s a specific perk you can negotiate for, maybe taking a bit less money wouldn’t be so bad. (Remote work, anyone?)

By looking at all of the ways you’re compensated, you’ll be more prepared to have a reasonable conversation about what you expect and what your employer is able to provide.

5. Have a Plan

Planning to negotiate at all is a great start, but you should come to the table with some specifics.

At minimum, you need to have two numbers in mind: a target — the ideal number you’d like to secure — and the lowest salary you’ll accept without walking away.

Your target will probably be close or equal to the top end of your job description’s average bracket. You can shoot for the moon beyond that… but if you’re too aggressive, you do put your offer at risk.

Your walk-away number is fairly self explanatory. What’s the minimum amount of compensation you’d need to happily perform this job’s requirements?

If you can, avoid selling yourself short. Unless you’re in desperate need of a job right now, you might be able to find a position that’s a better fit, better paid or both.

6. Be Confident…

Part of the reason it’s so difficult to negotiate is that creeping, vulnerable feeling you’re completely replaceable… which is especially easy to fall into after a long and arduous job hunt.

After all, if you ask for too much, there’s bound to be another guy who’ll do the job for less right around the corner. You don’t want to get cut loose.

But even though it might feel scary and presumptuous, negotiating may actually improve your appearance to your prospective employer.

“Negotiating is a demonstration of your leadership and signals to your potential employer that you’ll have the company’s back,” writes professional coach Lisa Gates, who co-founded She Negotiates.

“When you’re working with vendors, clients, and other partners, the company will want you to get the best deal possible for your team, right?”

So be confident in both your decision to negotiate and in the negotiations themselves.

When your hiring manager makes an offer, make a reasonable counteroffer — and don’t feel compelled to stop after her first rebuttal, either.

Keep going until you find a reasonable solution somewhere between your target and your walk-away number.

This is your job — and your life! You should be firm about wanting the best you can get.

Your employer will thank you for your perseverance later.

7. … But Know When to Stop

Obviously, don’t be pushy, rude or entitled.

Don’t ask for a salary you know is well outside the range the company is willing to extend.

Most of all, don’t be caught unprepared. (Asking for too much pretty much amounts to the same thing.)

Don’t make extreme counteroffers without any facts to back them up.

Gates writes, “Each counter offer you make needs to be backed up with credible reasons — stock phrases you develop in advance that are designed to express the value you bring to your potential employer.”

Some examples:

“My research shows the market value of this position is between $85K and $95K. With my experience in X and my training in Y, I think $95K is a more appropriate place to start the conversation.”

Or:

“Your offer is exactly what I’m currently making, yet this position has more responsibility and requires the specialized experience I have to help you accomplish your strategic plan.”

Be firm and concrete about what you want, but reasonable about what your employer can offer.

Pay attention to clues in your hiring manager’s body language and speech. If she’s uncomfortable, you should probably call it off.

Bottom line? Stop when you have an offer you’re happy with, but before you ask for too much.

That fine line will depend on your industry, role and a thousand other factors — but you’ll be able to sense it as you approach it.

8. Practice, Practice, Practice

Like any other new skill, negotiation takes time to learn, perfect and become comfortable with — so take your negotiation skills for a spin whenever you can.

You can start with low-stakes stuff: Ask for a dollar off the tomatoes at the farmers market, or see if you can haggle for a deal next time you hit the bookstore (yes, really).

Once you’re feeling more comfortable, you might negotiate for new benefits or better pay within your current position. Maybe you could use your skills to convince your boss to let you work from home.

The possibilities really are endless once you’re comfortable. You can negotiate the price of your next rental home, your cell phone bill or your car insurance.

You could even haggle about whether you or your partner is taking care of the dishes tonight. Or this week.

Or maybe forever.

… so just make sure you’re using your newfound powers for good.

Your Turn: Will you negotiate your next salary… or your next bookstore purchase? Let us know in the comments!

Jamie Cattanach is a staff writer at The Penny Hoarder who totally fell into that 54% statistic when she took this job. Her writing has also been featured at DMQ Review, Hinchas de Poesia and elsewhere. Feel free to reach out to her on Twitter: @jamiecattanach

The post You Got the Job, Now Get Paid: 8 Simple Steps to Negotiating Your Salary appeared first on The Penny Hoarder.

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Student Loan Deferment and Forbearance: What They Mean and When to Use Them

When it comes to student loan debt, there are myriad ways to pay it down and pay it off. You can go about it the old-fashioned way, choosing the standard 10-year repayment plan. Conversely, you can extend or reconfigure your repayment so it stretches out much longer – even up to 25 years – to lower your monthly out-of-pocket expense.

Some people refinance their student loans to score a lower interest rate with better terms. And still others are eligible for certain government programs that either limit their monthly payments to a fixed percentage of their discretionary income, or forgive their federal loans altogether if they meet certain requirements.

Of course, there’s always student loan deferment and forbearance – two student loan strategies that let you put off paying off your student loans for a limited time. While either plan can be a huge help if you’re struggling to make those monthly payments, each has consequences that may be hard to understand when you’re in the thick of a student-loan crisis.

Here we’ll explore both deferment and forbearance, plus offer alternatives that might leave you better off.

Defining Student Loan Deferment and Forbearance

In layman’s terms, both deferment and forbearance allow students to stop making payments on their federal student loans for a limited time. The biggest difference between deferment and forbearance is what happens to the loans – and the interest charged – during this temporary break from monthly payments.

Student Loan Deferment Explained

During deferment, the principal and interest of your student loans are both delayed temporarily. In most cases, the federal government pays the interest on your loans during deferment, which stops your balance from growing.

However, the federal government is very specific about which type of loans can qualify for deferment, and which do not. Student loans that may qualify for deferment include:

• Federal Perkins Loans
• Direct Subsidized Loans
• Subsidized Federal Stafford Loans

The government will not pay the interest on your unsubsidized or PLUS loans during deferment, however. If you have several types of loans, including loans that do not qualify, this is an important distinction.

In addition, not everyone will qualify for deferment in the first place. Criteria that can help you qualify can include any one of the following:

• You’re enrolled at least half-time in college or career school.
• You’re enrolled in an approved fellowship program or in an approved rehabilitation program for the disabled.
• You’re unemployed and cannot find full-time employment.
• You’re experiencing, and can prove, economic hardship.
• You’re in the midst of qualifying for Perkins loans cancellation or discharge.
• You’re in active duty military service during wartime, a military operation, or a national emergency.
• You have served in the military in certain other capacities within 13 months after active military service.

Because the federal government will pay your student loan interest in certain circumstances, deferment can offer temporary relief from your loans without a lot of long-term consequences. If you plan to graduate and expect to earn more money soon, for example, or are simply stalled in your search for a full-time job, deferment can be a good option.

Then again, it’s important to note that deferment doesn’t make your student loans disappear. You may get a short break from payments and interest, but your loans will still be there when your deferment comes to an end.

Student Loan Forbearance Explained

Forbearance is another way to stall your student loan payments if you don’t qualify for deferment. With forbearance, however, you’ll only get a break from making minimum monthly payments – not from the interest accruing on your loans.

When you sign up for forbearance, you can stop making payments on your federal student loans for up to 12 months, but interest will continue to accrue on all of your unsubsidized and subsidized loans, including all PLUS loans.

According to the U.S. Department of Education, forbearance can be either mandatory or discretionary.

With discretionary forbearance, your lender is the one who decides whether to grant a reprieve from monthly payments or not. Generally speaking, you can request forbearance for financial hardship or illness.

If you qualify for mandatory forbearance, on the other hand, the federal government requires your lender to grant it. Criteria for mandatory forbearance can include the following:

• You’re serving in a medical or dental internship or residency program and meet additional requirements.
• The total amount of money you owe each month on student loans is more than 20% of your total monthly gross income.
• You’re serving in a national service position, and you received a national service award.
• You qualify for teacher loan forgiveness.
• You qualify for the U.S. Department of Defense Student Loan Repayment Program.
• You’re a member of the National Guard and have been called for duty but do not qualify for a military deferment.

Because interest will continue to accrue on your loans during forbearance, it should only be used as a last resort. The consequences of letting interest accrue during forbearance are laid out clearly on the U.S. Department of Education website:

“Interest will continue to be charged on all loan types, including subsidized loans,” it says. “You can pay the interest during forbearance or allow the interest to accrue. If you don’t pay the interest on your loan during forbearance, it may be capitalized (added to your principal balance), and the amount you pay in the future will be higher.”

In other words, forbearance can easily take your student loan debt problem from bad to worse. When you let interest accrue – and then interest continues to accrue on your new, higher balance – you’re going to owe even more than the amount you had trouble paying in the first place. As this calculator shows, a $30,000 student loan balance would incur an additional $2,039 in interest over the course of a 12-month forbearance period.

That said, if you’re struggling to make your student loan payments, it’s still better to choose forbearance and pay more interest in the long run than it is to miss a payment — or worse, default on your loan entirely – and damage your credit history.

Additional Options to Consider

If you don’t qualify for a deferment and forbearance doesn’t sound like your cup of tea, there are other ways to lower the amount of money you pay on your student loans each month. In fact, the federal government actually suggests altering your payment plan to secure a monthly payment you can actually afford.

While a 10-year repayment plan is the standard, you can alter certain types of loans into a graduated repayment plan that allows your loan payments to grow with your income. This strategy is often used by graduates who plan to earn considerably more in the next five to 10 years.

Conversely, you can choose an extended repayment plan that offers lower monthly payments for up to 25 years. While you’ll have to pay your loans down for a longer stretch of time, your monthly payments may be a lot more affordable.

If your income is low enough, you may also qualify for income-driven repayment plans on your federal loans, such as Income-Based Repayment (IBR), Pay As You Earn (PAYE), Revised Pay As You Earn (REPAYE), or Income-Contingent Repayment (ICR). With income-driven repayment, you pay a small, set percentage of your discretionary income for 20-25 years and have any remaining loan balance forgiven at the end of that time.

Certain income guidelines and standards apply with each of these plans, so make sure to read the U.S. Department of Education’s guide on student loan repayment before you take the next step.

A Final Word

With both deferment and forbearance, it’s crucial to continue making monthly payments until you receive official notification that you’ve been approved for the program. If you stop making payments before a decision is reached, you may default on your loans, which can have serious financial and legal consequences.

If you’re struggling with student loan debt, you’ll likely find that none of your options sounds particularly attractive. Deferment offers some relief with little downside, except it’s only temporary; forbearance, meanwhile, can actually add to your student loan debt, and should only be considered as a last resort.

Related:

• Student Loan Consolidation Guide
• 15 Ways to Deal with Student Loan Debt
• The True Cost of Student Loans

Are your student loans in deferment or forbearance? Do you have a long-term plan to pay off your student loans?

The post Student Loan Deferment and Forbearance: What They Mean and When to Use Them appeared first on The Simple Dollar.

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