Repaying your student loans doesn’t have to feel like a life sentence. With some careful planning and proven strategies, you can release yourself from the burden of debt and move toward financial freedom.

Following a five-year student loan repayment pause due to the COVID-19 pandemic, millions of Americans are once again facing repayment requirements. Additionally, spring 2025 college graduates have reached the end of their six-month grace period and must now begin paying down their debt.

Amid rising costs and economic uncertainty, many borrowers are anxious about their financial futures. While this new repayment reality may seem daunting, some best practices and smart methods can make it manageable.

Understand the Details of Your Debt

When starting college, you likely didn’t fully grasp all the details of the financial aid package you accepted. Now, several years later, you’re facing loan information that’s challenging to comprehend.

Katie Galloway, a retail sales officer at Sunrise Banks, says that if that feels stressful, you’re not alone.

“It’s important to remember that feeling overwhelmed by student loans is incredibly common,” she says. “If you’ve ever looked at your balance and thought, ‘I’ll be paying this off until I’m 60,’ that’s a normal reaction.”

As a borrower, recognizing this reality is a critical first step in calming your anxiety. From there, understanding the details of your debt can help you regain control and optimism.

Start by collecting the key information and terms – including servicer details, interest rates, and balances – for each loan. This information can paint a clearer picture of what you owe, allowing you to make informed decisions moving forward.

Create a Budget that Supports Your Goals

Strengthen your financial foundation by creating a practical and effective budget that aligns your income and expenses with your overall goals.

Prioritize necessary fixed expenses, like rent or mortgage, transportation, and utilities. This is also a great opportunity to identify ways to trim back nonessential expenses.

“Many of us pay for five or six streaming services but only use two or three regularly,” says Katie. “Cutting back on these small ‘profit leaks’ can free up extra cash each month — money you can put toward additional loan payments to speed up your payoff timeline.”

A well-designed budget can reveal how much you can confidently put toward student loan repayment each month.

Find a Repayment Plan that Works for You

With your loan information and a realistic budget in hand, it’s time to decide on a repayment plan. This isn’t a one-size-fits-all approach; a variety of loan repayment strategies exist to fit different situations.

When meeting with clients, Katie often recommends the “snowball method” for debt repayment – and has successfully used it herself.

“The approach focuses on paying off debts in order from the smallest balance to the largest,” she explains. “You continue making minimum payments on all debts, but any extra funds are directed toward the smallest balance first.”

As you clear a debt, the amount you were paying goes toward the next smallest debt.

“This method not only helps to reduce debt faster, but also provides a sense of progress and motivation as you see balances disappear one by one,” she says.

The U.S. Department of Education offers a loan simulator Off Site Link to help you compare options and select a repayment plan that suits your needs.

Seek Early Assistance

For recent graduates in entry-level positions, salaries can be tight. Difficulties in maintaining loan payments can result in significant financial and credit consequences – including late fees, poor credit reports, and wage garnishment.

While falling behind on payments is serious, it’s not hopeless. Katie says seeking help early is essential for borrowers experiencing financial hardship.

“I strongly encourage you to contact your lender or loan servicer as soon as possible,” she says. “They may be able to work with you to create a repayment plan and help you get back on track.”

Fast action can unlock options to pause payments or reduce monthly loan obligations. Plus, deferment might be possible in certain cases – such as returning to school, serving in the military, or becoming unemployed.

Manage Repayments with Confidence

Student loans can be intimidating – but with clear insight, careful planning, and timely action, repayment is achievable.

If you have questions or concerns about your financial future, Sunrise Banks is here to help. As part of our commitment to support financial wellness in the community, we offer free financial counseling services through Lutheran Social Services to all account holders.

Learn more about the Financial Choice Program Off Site Link for Sunrise Banks customers.

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