mike: hey? have you guys ever heard of tyleroakley? well, tyler oakley has heard os student loans, cuz he had 'em. big time. and so heand his friends at big frame have asked us to make this for you to explain how studentloans work so you know, you guys can hae a slightly better life vis a vis (?) studentloans than tyler did. cuz from what i understand, he and his friends found it very confusingbeing that they're humans and everything. so how do student loans work, and how canyou make them work better for you? part one: the fafsa aka free application for federal student aid.now before you actually start looking for loans, you're gonna want to fill one of thesebabies out, either online or on a paper form,
which apparently is still a thing. did you?i didn't. in any case, huh? quick note: filling out the fafsa is free!free! never pay any scammers who are trying to get your money to fill it out. go to fafsa'sgovernment website, not fafsa.com because those guys... somethin's fishy. in addition to being used for federal financialaid the fafsa is also used by state and school funded programs, such as scholarships. nowif you’re in high school, reeer-eer rock and roll, high school here, it's the hippestplace in town. look at me, i'm not a 31 year old man, i'm so hip. i think you can tell.(beep) if you’re in high school then you’ll definitely want to fill this out as soon aspossible after january 1st during your senior
year. if you’re not in high school, youstill do want to fill it out as soon as possible after the new year. i do want to take a second to emphasize howimportant this is. most financial aid is given out on a first come, first served basis eventhough it is determined by different factors. so the sooner you can get that fafsa in, thebettter you chances of getting the maximum amount of aid available to you. and alas,this is not a one time thing, either. even when you're in school, you have to keep fillingit out every year. this is because, you know, your circumstances might change. one of ourlovely tumblr readers said that you can get help from the financial aid office which makesa lot of sense and we would highly recommend
that. to actually fill it out your fafsa, you’regonna need some documents. there are lots of different ones, so right now that informationis just floatin' around my face right now because powers. also, don’t leave any blankspace on the form, if something doesn't apply to you, just write zero or not applicableand then you're done, you know. just wrap that baby in a blanket and smack it on thebottom, cuz we're going on to-- part two: types of loans after submitting your fafsa, there are goingto be a number of different loan options. these include:
1. stafford loans – these are offered directlyto you, the student, from the us department of education. they can be used to pay formany different kinds of higher education. stafford loans will either be subsidized orunsubsidized, based on your financial need. subsidized loans mean you don’t have topay any interest on the loan while you’re still in school at least half-time. if yourloan is unsubsidized, you begin accruing interest on the first day you receive your funding. 2. plus loans – aka “parent loans forundergraduate students.†these loans are offered to the parents of students by theus department of education to help fund their child’s education. plus loans are limitedto the actual education expenses minus any
other financial aid received by the student. 3. perkins loans – perkins loans are availablefor undergraduate or graduate students. these loans are financed by your school, but areguaranteed by the federal government. perkins loans are based on your financial need andhave caps of $27,500 for undergrads, and $60,000 for graduate students. when weighing your financial options, pleasebe sure to look at your interest rate. even decimal points of difference can add up tohuge amounts over the 10, 20 or whatever years during which you're going to be paying yourloans. so read that fine print baby! depending on your situation, you may alsoneed to apply for private loans. these are
kind of tricky. private loans typically chargehigher fees and more interest, but we do know that they might be the only option in yourcase. more info in the dooblydo. part three: repayment hey, check out that fancy piece o’ paperin your hands! whoah mama! aooga! time to pay for it. you're gonna have a few differentchoices of how to pay your loans back. 1. original terms - you can repay based onyour loan’s original terms. this is typically a 10 to 20 year repayment plan and it is themost common method. 2. income-based repayment. this is the secondmost common type. the terms of your original loan are restructured to fit into your budgetbased on your current level of income. you
will need to reapply ever year for this typeof repayment, because your income may be changing year to year, hopefully going up. up, up,up, to the moon! 3. deferment - if you can't afford your studentloan payment, in some cases you can defer it. deferment doesn’t get rid of your studentloan debt, it simply puts off when your repayment plan begins. it’s usually only granted tocurrent students, citizens in the military, or if you’re unemployed or are earning lessthan the minimum wage. unsubsidized loans will continue to accrue interest during deferment,so it’s a good idea to make any payments that you’re able to. 4. consolidation loans – if you’re nowout of school and find your current repayment
plan difficult to manage, you can always consolidateyour loans. consolidating will take multiple loans and simplify them into a single newloan. this can make repayment simpler and can extend your repayment terms up to 30 years,which will lower your monthly payments, but will greatly increase the amount of interestyou pay over the years. it is super dupes important to stay on topof your student loan payments or to work with a loan servicing company if you know thatyou can't make your payments, do that as soon as possible. also, student loan debt doesnot automatically go away. even if you file for bakruptcy! what the crap? only under veryspecial circumstances are you going to have these loans forgiven. one of those circumstancesis death. so you die, but you don't have to
pay. every cloud... you may actually be able to get your loansreduced or completely forgiven if you choose to work in the public sector. you may stillhave to may 120 on-time monthly payments before your remaining balance is forgiven, but thisis a great option for local, state, and federal government employees. part four: a note for parents hi parents! it's nice to see you around here.you're looking nice. would you like this gift card for chili's? (laughs) or these ticketsto your billy joel concert? or would you like... what's another thing grown-ups like? i'm agrown up (record scratch) existential crisis!
according to forbes, more than half of allstudent loans are either delinquent or in deferral. these loans can be for staggeringamounts, so if you do choose to help pay for your child's college education, saving earlyis a+++. the irs actually wants you to help pay for your child's education, so they havesomething called a 529 savings plan, which is kind of like a roth ira for saving foryour bebes’ future. not everyone has parents who are going to be able to help, but i dowant everyone to know this option exists to help. part five: tyler oakley i'm so excited about this that i spit. i spitin the rainbow arc, with the bad french accent
that goes to italian sometimes. tyler, youmake me speak in tongues, you make my sould dance, you make my liver quiver. i don't knowwhat to say to you except (kiss) thank you so much to tyler oakley and friendsfor suggesting the topic of this week's video. in return, i'm so happy to tell everyone thathowtoadult will be donating ad revenue from this video to the trevor project. the trevorproject is a 24-hour hotline and resource for crisis intervention and suicide preventionservices to lgbtq young people from ages 13-24. tyler has supported the trevor project foryears. it's very near and dear to his heart and to ours, so this is just our way of payingit forward. thank you so much tyler, we heart you. if you guys are looking for a model ofawesome adulthood, tyler oakley is pretty
hard to beat. we'll see you guys next week.i love you bye. (kiss) (endscreen)
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