Rhita Zhang joined California State University, Monterey Bay (CSUMB) students virtually for the final event in the Thursday Money Moves series hosted by The Otter Cross-Cultural Center on April 7.
Zhang introduced the workshop with a holistic approach, recognizing that first-generation students and those with “poor-working background,” avoid debt and carry heavy feelings toward it.
Debt is manageable when utilizing practical tools, and it can be helpful to view repayment with this alternative framework in mind. Loans provide leverage, especially in access to education.
“I think knowledge is power,” Zhang said. “It helps me feel more powerful when I know what to expect.”
The discussion started with mindfulness as guests pulled cards from the affirmation website Gratitude Blooming, sharing the wisdom and insight they received.
Students found comfort in acknowledging growth opportunities and accepting that their financial decisions were a product of what they knew at the time.
The loan simulator portion of the event prompted attendees to fill out a short survey to build a fictional character graduating from university.
Utilizing online estimators provides value by comparing various repayment plans, compiling predicted job salaries, desired time frames for paying debts, and intentions after college.
Zhang continued her presentation by outlining the different loan classifications, explaining that subsidized loans involve no interest until repayment.
Unsubsidized involves immediate interest, paying back more money in the long run.
Most graduates carry federal student loans, a combination of subsidized and unsubsidized, with low-interest rates and a six-month grace period after college before repayment begins.
Zhang emphasized that directly enrolling in graduate school after university freezes the repayment phase, leaving more time to pay off those loans.
With graduation season approaching, students can visit studentaid.gov to view debt information.
Zhang also highlighted The Public Service Loan Forgiveness (PSLF), a program for non-profit and government employees, and once you work ten years, all owned loans get waived.
Loan consolidation was another focal point of the conversation, the idea of combining loans and making one payment for convenience.
The lower-interest rates often outweigh the costs of consolidation fees, and students must make their calculations before selecting this method.
After Zhang shared her recommended financial resources, she highlighted default, common setbacks, and mistakes to avoid.
Missing payments can result in the government taking your social security benefits, seizing your tax refunds, and garnishing your wages.
Many hold the perspective that debt is negative, but through counseling and evaluation of loans and repayment methods, students can find empowerment and success with their finances.