Student loans are something that absolutely must be dealt with no matter what. There is no responsibility that is greater, as the consequences for not repaying a federal direct student loan are great. Not even the IRS can compete with the possible outcomes of letting a student loan fall into the abyss in fact, most people who are educated on the subject would much rather owe the IRS money than be in trouble with a student loan. Defaulting on such a loan is something that no one should ever let happen, and here is why.

To draw a comparison, the IRS will only require money based on what you are making, income-wise. Many people find themselves with hundreds of thousands of dollars’ worth of student debt, which will have nothing to do with how much you make after college. And with the economy being in down in the dumps, it is that much harder to land a job in which a former student can readily pay off such a huge debt. Students may find themselves working two jobs just to keep up with bills. Law school graduates are among those who have paid the most for their educations, only to find that law firms are not paying those who have just passed the bar what they used to. A legal position which used to pay $200,000 a year may be down to about $50,000 a year.

These are the times we live in, and unfortunately society expects those with professional career goals to attend pricey university institutions. Former students in the US now owe more money in student loan debt than ever before they owe more money in student loans than they do in credit card debt. Student loans will never go away until they have been paid. A student loan must be paid even if a former student declares bankruptcy. There is absolutely no way to escape a student loan, and the government will take the money out of a retiree’s social security benefits if a loan has yet to be paid.

Because students tend to be young and inexperienced with money, loans can be an abstract thing. These students believe that when they take out huge sums, the will one day easily be able to pay them back. Unfortunately, students can’t see into the future to see what kind of a job they will end up with. Students may not be able to understand that they will be paying off these loans for decades to come. They may even be paying them when their own kids have gone off to college. As you can see, student loans will have quite an impact on the future and shouldn’t be taken lightly.

If you are in college, it is important to pick a student loan carefully each semester. Instead of going with the same lender every time, carefully look over the options and decide which lender is offering the best deal. Because you may not earn six figures straight out of college, you will want to spend as little money as possible on APR.

Author Bio: Ellie Lewis recently spent time researching student loans. Her son is going to apply for a federal direct student loan.

Category: Finances
Keywords: student loans,federal direct student loan