3 Graduates’ Stories of How Their Handling Repaying Their Student Loans

If only prospective college students had a crystal ball: some way to know exactly what their future held, and whether borrowing money to pay for school would prove worth it.

Alas, one of the best ways to make informed – if not clairvoyant – decisions about loans is to talk to other students with borrowing experience.

“There are a few things that are unique about student loans that make it that much more important to speak to people who have been there and done that,” says Angela Colatriano, Chief Marketing Officer of College Ave Student Loans. “It’s probably the only loan anyone’s going to take that they might not start paying back immediately, and it’s often people’s first loan, so they don’t have an auto loan or mortgage to compare it to.”

According to a survey from College Ave Student Loans conducted by Barnes & Noble College Insights^TM, college students are contributing more toward their college education. More than half (57%) of the 1,111 respondents plan to repay their loans without help from their parents, and 1 in 5, or 18%, began making payments while still in school.

Here, three college graduates describe their decision to take out college loans – and how they’re handling repayment.

Melissa Gallardo Borrowed for Her Bachelor’s Degree: Class of 2019

Melissa Gallardo, 25, had no disillusions about the price of college. She knew it would be expensive, and that she’d need financial aid. She received scholarship money from Manhattan College, where she studied communications, and took out about $60,000 in federal student loans. Half of that is under her own name, and the other half is under her parents’ – but she’s responsible for paying the debt back. In August 2022, President Biden announced a student loan relief plan that will cancel $10,000 in federal student loan debt for those who earn less than $125,000 a year and $20,000 for those who have received Pell grants. Gallardo says this plan will eliminate at least $20,000 of her debt.
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Since completing her bachelor’s, Gallardo has started graduate school, which she pays for out of pocket. She plans to repay her undergrad loans once she finishes graduate school, so she’s making concessions in her daily life, like living at home instead of renting her own apartment. “I think about my finances every day, every week, every month,” she says.
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In addition, Gallardo juggles payments on her leased car and medical expenses. She’s still on her parents’ health plan but is responsible for paying her own deductible, copays and coinsurance, which sometimes cost hundreds a month: “It’s really unpredictable since I have chronic back pain,” she says.
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That’s one reason why, in 2020, Gallardo launched a side hustle: Bonita Fierce Candles, LLC, a Latina candle brand that offers scents like “abuela’s bakery” and “cafecito con leche.” It’s part of her plan to pay off her debt and achieve financial solvency.

Gallardo urges future students to become financially literate as early as possible. “Understand what it means to have a budget and how to handle your money – not just loans but across the board,” she says, adding that no one taught her those skills; she had to learn them herself.

Eva Keller Borrowed for Her Master’s Degree: Class of 2018

When Eva Keller went to Saint Leo University to study international tourism and hospitality management, she used her dad’s GI bill benefits for military families, plus scholarship money. That helped cover tuition, room and board. She received her degree in 2015. When she began graduate school at the University of Central Florida, she covered one semester with GI bill funds, then used federal loans to pay for the last three semesters. She graduated in 2018 with $28,000 of debt.

“My thought was, I didn’t have to pay for a bachelor’s degree,” Keller, 28, says. “I was like, it’s not bad if you look at it like that.”

After her grace period ended, Keller – who now lives in Orange County, California and runs a food and travel blog – began paying back about $200 a month via automatic payments. When her salary increased at her job, she began making those $200 payments every two weeks: “I was like, let’s pay this down now that I’ve got this extra money.” She stopped making payments during the government freeze on federal loan repayment, and had plans to resume paying back the remaining $19,000 she owes after the freeze ends, but now she’s waiting to determine how the student loan relief plan will impact her outstanding balance.

For now, Keller keeps her living expenses low. She and her husband live in a two-bedroom apartment and rent out the second bedroom to help with bills. She drives a hand-me-down 2010 car that she’s never had to make payments on, and she has zero credit-card debt: She pays off her card every week so nothing accumulates to an unmanageable amount.

“So really, I just have normal living expenses: rent, utilities, car insurance/registration, renters insurance, medical and dental insurance, groceries [and] gas,” she says.

Marie Rachelle Borrowed for Her Bachelor’s Degree: Class of 2014

Back in 2010, when Marie Rachelle enrolled in Bryant & Stratton College to study business administration, she took out between $20,000 and $30,000 in federal loans to cover her tuition. (She was able to keep living at home, saving thousands on room and board.) Before the federal freeze, Rachelle, 30 – who graduated in 2014 – was repaying about $200 a month, with $7,000 to go. She’s waiting to see how the loan relief plan will affect that balance.

In addition to paying back her loans, Rachelle’s monthly expenses include: rent, car payments, daycare for her two children and health insurance. There’s also monthly insurance policies, utilities and other miscellaneous expenses, like gas and groceries.

Rachelle’s biggest tip for incoming college students is to take advantage of scholarship opportunities. “I chased every single scholarship,” she says – and it was worth the extra work, because it helped her cut down on the amount she needed to borrow. She urges students to put in the time to research options.

After graduation, Rachelle worked in human resources for five years. She’s now a freelancer offering services such as public relations and marketing consulting, and has opened the first coworking space in Hamburg, New York, Convergence Coworking.

“Even though I’m successful, most of the time you’re putting your money back into your business,” Rachelle says. She’s keeping her eye on the finish line, though, and hopes to pay off her debt before too long. Budgeting carefully is key. “Because I own my own business, I just make sure to work really hard in order to upkeep my bills and my lifestyle,” she says. “Fully sustaining a household on my own income as an entrepreneur can definitely be tough.”