College is expensive. Unless you have rich, generous parents, you got the right scholarships, or you married for college money, you probably have or had student loan debt.

If you still have student loans then your payments could be breaking your budget. Maybe your job doesn’t pay enough or the monthly payments are just too high. You don’t want to miss your payments because you don’t want to ruin your credit, but you also can’t afford to spend so much of your income on student loans. What can you do?!

Go back to school.

No, I’m not talking about taking out more student loans to go deeper in debt. All you have to do is become a part time student at a local community college (usually six credit hours or more) and get in-school deferment for all of your student loans for the time you are a student and nine months after. That’s basically a year without needing to pay a penny towards those loans.

Edit on 10/5/11: My student loan providers just informed me you only get the 9 month grace period once. They erroneously gave me a grace period and then took it away when they realized their mistake. I have edited the rest of the post to remove reference to the 9 month grace period. Most students use this grace period up right after they graduate college.

In School Deferment for Student Loans

If you have subsidized federal loans, the government will pay the interest on these loans and your principal will not grow while you are a student. Perfect! You put off paying the loans and the balances don’t get any bigger. This is a no-brainer.

If you have loans that are not subsidized, you have the option to either pay the interest every month or pay nothing and let the loan get a little bigger every month. Remember that you can always pay as much or as little as you want towards any loans, even when they are deferred. The benefit of an in-school deferment is that you DON’T HAVE TO PAY if you don’t want to.

If you are truly struggling with paying your student loans, this is a great way to give yourself some time to figure out how to increase your income or decrease your expenses to make the student loan payments manageable.

I can hear the objections now from the whiny butts out there.

It’s Too Expensive to Go Back to School

Community colleges are cheap. I live in Dallas and classes cost $45 per credit hour. That means it would cost just $270 for six credit hours, which would defer your student loan payments from the day you start classes to nine months after the end of the semester.

My personal student loan payments are $300 a month, or $3,600 a year. I can either pay $225 for six credit hours and the option to defer my loans for a year, or pay $3,600. As you can see, it’s cheaper to be a part time student and defer loans than it is to make one month of student loan payments in my situation.

But I Don’t Need Another Degree

You think you don’t need any more education. I think you’re probably wrong.

college graduation

photo credit: flickr.com/photos/celloc/

If you got a degree in Film or Women’s Studies or Communications or some other bogus major, there’s a good chance that you are either unemployed or working a low paying job that has nothing to do with your degree. I realize that not everyone with those degrees is struggling financially, and if you are the exception then I’m happy for you. My point is, the exception for your degree is someone who is making good money, whereas the exception for engineering degrees is a person who isn’t making good money.

If your degree isn’t very valuable in today’s job market, you can get started on a new degree that will actually help you get a job. Engineering is my favorite, but you can do anything that gives you a real skill. Accounting, Nursing, Computer Science, or even a foreign language will teach you a real valuable skill that will qualify you for different, better paying jobs, or make you more marketable in your current field.

Maybe you are happy with your college degree and really don’t want another degree. Great! You don’t need to be a degree seeking student to qualify for in-school deferment. Pick anything you want. Maybe you’ve always wanted to learn to sing or play piano. Maybe you’ve always been curious about 18th century history. Just find something you’re interested in and take some classes. It will be a lot of fun and it will get your butt off the couch and away from Dancing with the Stars.

It Works Even If You Can Pay Your Loans

Even if you aren’t having trouble paying back your student loans, you may want to get in school deferment anyway. It didn’t even occur to me at the time, but I took classes last semester and ended up with an in-school deferment. When I realized the option was available, I jumped!

I’m going to keep paying all my unsubsidized loans because they are still accruing interest (even though I’m not required to), but I’m leaving the subsidized ones alone. I’ll let my tax dollars pay that interest and I’ll invest that money elsewhere. You should too.

Enjoy all that extra room in your budget. You’re welcome.