EMERYVILLE, Calif., March 22, 2018 /PRNewswire/ -- There is no shortage of financial advice online. While individuals should consult with financial experts for personalized guidance, much of the advice online comes down to how to allocate income. However, as one commenter pointed out in response to an article about how to pay off student debt, getting out of debt and saving money for anything depends on making enough money. That may be difficult for many student loan borrowers. American Financial Benefits Center (AFBC), a document preparation company that assists with federal repayment plan applications and recertification preparation, reminds borrowers that if their student loans limit progress toward financial goals, income-driven repayment plans may create some budget room.
"It can be hard to know what to do with your finances, especially if you struggle with them," said Sara Molina, Manager at AFBC. "If you don't have enough income to cover all expenses or to save anything after covering expenses, your federal student loans may hold the key."
Financial goals can range from building an emergency fund (experts often suggest having three to six months' worth of living expenses saved up) to saving for a vacation or paying down debt. Whatever the goal, individuals or families may need some extra funds in their monthly budget if they intend to make progress toward that goal. One option for finding those funds is to increase income, either by asking for a raise at work or picking up a side hustle.
For those who either cannot or would rather not seek additional income, federal income-driven repayment plans may make their student loans work in their favor. By calculating federal student loan payments based on income and family size, payments may decrease to as low as zero dollars a month. Any reduction in payment from enrollment in an IDR can be allocated toward the financial goal of choice.
"IDRs may be a good starting point for student loan borrowers who feel their budget is too tight to put money aside, but they should consult with a financial expert about their specific situation," said Molina. "AFBC clients who are in IDRs may have the room in their budget to pursue other goals, and we hope they are taking advantage of that."
About American Financial Benefits Center
American Financial Benefits Center is a document preparation company that helps clients apply for federal student loan repayment plans that fit their personal financial and student loan situation. Through its strict customer service guidelines, the company strives for the highest levels of honesty and integrity.
AFBC is a member of the Association for Student Loan Relief (AFSLR), and each representative on the phone has received the Certified Student Loan Professional certification through the International Association of Professional Debt Arbitrators (IAPDA).
To learn more about American Financial Benefits Center, please contact:
American Financial Benefits Center
1900 Powell Street #600
Emeryville, CA 94608
SOURCE American Financial Benefits Center