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Debt management after college, and how credit counseling services can help

The job market you have at your disposal can certainly affect your debt management strategies -- including how you will tackle your student loans after you graduate from college. The entry-level market outlook is also, believe it or not, entirely dependent upon where you live and what marketable skills you have. The entry-level job markets in Nassau County, NY; Brooklyn, New York; and Pittsburgh, Pennsylvania, for example, can vary quite drastically, with each area having more jobs in some specialties than other. Many new grads must choose between short-term financial comfort and eventual career success – entry-level jobs can pay small salaries, and not all jobs will offer full-time hours.

In order to balance your low-income-to-debt ratio, you need to formulate a strategic debt management plan. This plan put into action can help you to avoid debt and keep your credit score high. Fortunately, there are several ways to do this, and not all are painful. Your first step will be to enroll in an online credit counseling service or telephone counseling session. Advantage CCS offers these programs; and, they can help you formulate a comprehensive debt management plan that suits your specific needs.

The quickest route to achieving spending-income equilibrium – and, therefore, avoid debt -- is to cut down drastically on your living expenses. For example, if your rent is unaffordable, consider taking on an extra roommate, or moving in with a friend or relative. If it's your bills that are killers, you might want to look for an apartment that includes some or all of the utilities in the rental price. Sure, the rent might be a bit higher, but you will really see savings during the hottest or coldest times of the year, when the furnace or A/C is running 24/7. Consider switching to a lower-cost cellular phone plan, or, if you have both a land-line and a cell phone account, eliminate one or the other. Your Advantage CCS credit counseling advisor will discuss which specific tactics will fit into your debt management plan best.

Many college grad-centered Web sites such as One Simple Loan suggest that if you cannot afford payments on your student loans, you can apply to get them put into forbearance or deferment. These options suspend your loan payments for a time, until you qualify again, income-wise, to make payments. During deferment, the interest on federal subsidized loans is paid for you by the government. You are still held to paying the interest that will accrue on loans in forbearance, however. Your credit counselor can help you decide which strategy suits your debt management program.

Usually, non-essential spending is the easiest type to eliminate. You can blame endless media coverage of glamorous celebrities' lives, or prime-time television characters living large, but people of all ages yearn to experience “the high life,” too. For a younger worker, this might include lavish dinners out, expensive nights spent club-hopping, or weekend shopping -- all of which can wreak serious havoc on a budget. Your debt management program can include strategies for paring down your expenses. Talk it over with your credit counselor. If you spend a bit of time exploring your options, you're sure to come up with many interesting low- or no-cost leisure activities (libraries, museums, and walks in the park are just a few of many options).

Finally, when paying off loans while avoiding debt on an entry-level salary, you always have the option of increasing your income to match your spending habits. You can easily take a part-time job in an industry such as retail or the food service sector. You can also consider piece work, such as freelancing or landscaping gigs; babysitting; pet care; or yard work, providing you have the skills that qualify you for this work.

Living on a small salary while avoiding debt and bad credit can be financially difficult. However, with the help of a smart debt management program, and modest financial sacrifices, a fulfilling life on your first salary can be doable -- and you can avoid going into (further) debt.

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