Is It Better To Defer Student Loans, Or Pay Them Back During School?

As a general rule, it is always better to pay back your loans as quickly as possible instead of opting for loan deferment. But “general” doesn’t apply to everyone.

A stopwatch sitting on top of money.

Why You Should Pay Back During School

Paying back your loan while you are still in school gives you the benefit of eliminating, or at least greatly reducing, your student loan debt upon graduation. Moreover, by paying off your loan earlier, you don’t have to worry about the interest accruing quite as much. The sooner you pay off your loans, the lower the accrued interest, which means you will be paying a much lower cost for your loan as compared to students who choose to defer. Overall, you would save yourself a good amount of money.

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Why You Should Defer

Of course, if it were that simple, all students would choose loan deferment and there wouldn’t be this huge nation-wide discussion about student loan burdens. The fact is, paying back student loans while you are in school involves working while you study to earn some money towards the early payment. Not everyone can juggle a job (or jobs) and studies successfully. College coursework can be quite rigorous and trying to manage both can be an ongoing struggle resulting in early burnout. Besides, it may push back your graduation date as you are more likely to take longer to complete your coursework. Deferring grants you the option to delay payment, and focus instead on your college years.

So should you pay your loans back during school? It may not be the right choice for all students. You should choose this option only if you are confident in your ability to balance work and school without burning out.

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Lender Rates (APR) Eligibility
Earnest company logo.
Variable APR: 1.89% - 7.99%*
Fixed APR: 3.49% - 7.99%*
Undergraduate and Graduate
Lendkey company logo.
Variable APR: 2.05% - 5.25%*
Fixed APR: 2.69% - 7.93%*
Undergraduate, Graduate, Parent PLUS
Credible company logo.
Variable APR: 1.86% - 8.38%*
Fixed APR: 2.35% - 8.73%*
Undergraduate and Graduate
Laurel road company logo.
Variable APR: 2.50% - 6.30%*
Fixed APR: 3.99% - 6.40%*
Undergraduate and Graduate
Fixed APR: 3.94% - 9.08%*
Undergraduate, Graduate, Parent PLUS
VISIT ISL Education Lending
Variable APR: 3.44% - 7.99%*
Fixed APR: 3.99% - 7.99%*
Undergraduate and Graduate
VISIT College Ave
Variable APR: 1.86% - 7.98%*
Fixed APR: 3.99% - 6.99%*
Undergraduate and Graduate, Parent PLUS

*APR includes a 0.25% interest rate reduction for enrollment in automatic payments.

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