Financial Aid Guide
— Managing Your Debt —
Preparation is an effective prophylactic for financial headaches.
Keep accurate records from the start!
Keeping Records
Educational loans have long-term implications for your financial future. Therefore, special attention must be given to the management of personal and educational debts from the very beginning. Keep accurate records of all debts, including, but not limited to:
- copies of loan applications,
- copies of promissory notes,
- loan disclosure statements,
- correspondence from the lender or Servicer, and
- award notifications.
If you have not kept records during the undergraduate years, request from your financial aid office a copy of your financial aid records. Use the information received to begin accurate record keeping. You can also access your records by reviewing your history through online services like the National Student Loan Data Service (NSLDS) at www.nslds.ed.gov or your loan servicer. At IUPUI, you have access to your records by going onto http://onestart.iu.edu or Sallie Mae at https://opennet.salliemae.com.
Repayment
Loan repayments may seem too far away to even think about. Calculating monthly payments can be a formidable task. However, it is a good idea to estimate what payments will be so that one can budget money accordingly when beginning a residency. To calculate payments for deferred loans over the ten years after graduation from medical school, use the conversion factors in the following table. The sample calculation shows how to figure out the monthly payments for three loans with different principal amounts and interest rates.
| Table of Conversion Rates for 10-Year Repayment Schedule | |
|---|---|
| Interest Rate |
Conversion Rate |
| 3% | 0.009656 |
| 3.5% | 0.009891 |
| 4% | 0.010125 |
| 4.5% | 0.010360 |
| 5% | 0.010607 |
| 5.5% | 0.010842 |
| 6% | 0.011102 |
| 6.5% | 0.011337 |
| 6.8% | 0.011509 |
| 7% | 0.011611 |
| 7.5% | 0.011846 |
| 8% | 0.012133 |
| 8.5% | 0.012399 |
| 9% | 0.012668 |
| 9.5% | 0.012947 |
| 10% | 0.013226 |
| 10.5% | 0.013505 |
| 11% | 0.013784 |
| 11.5% | 0.014063 |
| 12% | 0.014347 |
| 12.5% | 0.014626 |
| 13% | 0.014905 |
| 13.5% | 0.015184 |
| 14% | 0.015527 |
| Sample calculation: | |
|---|---|
| The below example shows a medical student borrowing $34,000 in Subsidized Stafford Loans ($8,500 per each year of medical school) at 4 percent interest as well as $100,000 in Unsubsidized Stafford Loan ($25,000 each year) and $10,000 in Perkins Loans at the 5 fixed percent interest. The following are the monthly payments for a ten-year period, calculated as follows: | |
| $10,000 (Federal Perkins Loan) at 5% | $10,000 × .010607 = $106.07 |
| $34,000 (Subsidized Stafford) at 4% | $34,000 × .010125 = $344.25 |
| $100,000 (Unsubsidized Stafford) at 4% | $100,000 × .010125 = $1,012.50 |
| Total Est. monthly payment | $1,462.82 |