6 Tips to Use the Moratorium Period of Your Student Loan

Ailsa Adam August 21, 2021

Student loan repayment is a stressful topic of discussion for new graduates. They need to manage the instalments with a limited income amid the different expenses. The moratorium period may seem like a significant duration but will not provide relief forever.

Therefore, it may seem intimidating but you need to start the repayment plan early. Solidify the financial condition to get ahead of the repayment before the moratorium period ends. Thus, a few financial problems will not force you to take more debts to get stuck in an endless loop.

How to Manage an Emergency During the Moratorium Period?

A major reason for people to lose grip over their student loan repayment is an unforeseen emergency. You cannot avoid certain situations but prepare yourself to sail through them. Start saving money during your college years to create an emergency fund for your life outside the college.

Make sure to have a line of credit available apart from credit cards to get instant financial support. It can range from a reliable member of your family or a direct lender with a same day disbursement policy. Online loans will have lower interest rates than credit cards to reduce the stress of repayment.

Tips to Solidify Your Finances During the Moratorium Period of Your Loan

You should focus on solidifying the financial condition to ensure timely repayments during tough times. Also, you can use some methods to find support for the repayment or save money on the overall cost. Here are some tips to use the moratorium period of your student loan to solidify your financial condition.

Find the Overall Cost of the Loan

You need to find the overall cost of the loan to create an effective repayment plan. Without the total cost, you are shooting arrows in the dark with a small vision. Many people create budgets keeping in mind the instalments while the overall cost makes more sense.

You can use your income to assess different repayment plans and options. Thus, it will help to save significant money in the long run with early repayment of the loan. Furthermore, you will have a plan to manage a few months of repayment without an income.

Enlist the other details such as monthly instalments and interests while trying to measure the overall cost. You need to find the other expenses such as early repayment charges or late fees for your payments to create a detailed plan. Thus, you will have a solution ready before a situation creates trouble for your finances and credit history.

Check the Repayment Plans

Your student loan lender will provide multiple repayment plans to suit your budget and requirements. These plans will differ in terms of the duration and instalments of the loan. Therefore, check the repayment plans and align them with the budget to find the least stressful option for your finances.

It is okay to pay a little more interest if you want to live a comfortable life for the years to come. You don’t have to take an unreasonable instalment plan to save money on the overall interest. However, it will only lead to stressful budgets with missed payments in case of some unexpected expenses.

You can also use the student loan refinance option to get better interest loans for the same amount. The offer was made a few years ago based on your prior credit history and earning potentials. You will easily find better offers if the profile has improved over the years.

Consult the Employer

Many employers provide support for the education loan repayment of their employees. It is part of their strategies and initiatives to promote higher studies in the working population. Also, it helps them attract the best talent from the industry to strengthen their core team.

Send a query email to your HR or ask them personally to find the possible benefits of the student loans. Even a small contribution will help big time during the early stages of your career. Double-check whether the employers have contributed to your student loan before making changes to your repayment plan.

Create a Repayment Budget

Once the options and plans are clear, you need to start creating a budget to repay the student loan. You need to put the amount of repayment aside with a small increment to pay the loan a few months early. Also, try to increase your savings to build an emergency fund.

It will help maintain the repayments during the tough phases of your career. Sudden unemployment will leave the finances in a difficult situation to manage the instalments. With an emergency fund, you don’t have to rely on another loan or repayment holiday.

Start Early

The moratorium period can last up to a year in the case of some lenders. That makes people wait for the period to end before they start the repayment. However, it makes no sense if you can manage the payments early.

Start the repayment a few months before the moratorium period ends to build positive relations with the lenders. You will get free from the debt before the original terms. Moreover, the lenders may provide support because of your good behaviour with repayment holidays during financial troubles.

Ask for Assistance

You cannot run away from debts by ignoring the emails and calls from your lender. We understand the financial troubles of the borrowers as they go through different stages of life. Therefore, you may get a repayment holiday or some other assistance if you explain the situation to the representative.

The legal process to report a dispute and start the proceedings is expensive and time-consuming. It is easier to give additional time to the borrowers instead of forcing them to pay the instalments during an emergency.


To sum up, the bad reputation of student loans is because of the improper planning of the borrowers. You need to use the moratorium period to get ahead of the repayment with the right strategies. It may sound like a lot of work but the results will save significant money on the overall cost.

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