Should I consolidate with a longer payback term?

Over-extended repayment plans

While researching student loan consolidation benefits, don’t get swept away with over-extended repayment plans. If you originally agreed to pay back your loans with ten years, switching to a 30-year plan might not make sense.

Sure, you’re going to have considerably lower monthly payments, but you’re also going to end up paying a lot more on your loan than you originally borrowed.

The longer you make your payments, the more interest you pay overall. Even with a lower interest rate than you already had, the overall payout will be greater because of the longer repayment period..

One of the most useful tools online for students is the student loan calculator. With these, you can determine what it’s going to cost you to pay back all of your loans as is, and will help you take a closer look at student loan consolidation incentives. Sometimes it’s easier to make a decision when you see it in black and white.

When it comes to things like fixed and variable interest rates, doing the math and taking a long hard look at the numbers usually makes the most sense. So, do yourself a favor, don’t be swayed completely by low monthly payments. Look at the big picture in order to make the best decision for you and your financial future.