Education Department Launches New Online Tool To Help Students Manage Loan Debt
Today, the U.S. Department of Education released a new interactive loan counseling tool to provide students with financial management basics, like information about their current loan debt and estimates for student loan debt levels after graduation. Students can access the new resource, known as the Financial Awareness Counseling Tool, on StudentLoans.gov.
“Managing student loan debt can be a difficult and confusing process for many borrowers. That's why the Obama Administration has been working to unravel the mystery of college financing and arm students and parents with the information they need to make smart educational choices," said U.S. Secretary of Education Arne Duncan. "Students need to know up front how much college will actually cost them instead of waiting to find out when the first student loan bill arrives. This new tool will help bring new transparency to the process of debt management on the front end and empower students to keep their school loan payments on track and on time after graduation.”
The Financial Awareness Counseling Tool provides students with five interactive tutorials covering topics ranging from managing a budget to avoiding default. Students are able to access their individual loan history and receive personalized feedback that can help them better understand their financial obligations. In addition, college financial aid professionals can monitor a student’s progress in using the tool and provide assistance if necessary to help ensure they can utilize the information the site provides.
Today’s announcement is part of an ongoing effort by the Obama Administration to make college costs more transparent for education consumers. Recently, the Department published its annual college cost lists, which detail schools with the highest and lowest published sticker price, schools with the highest net price once grants and scholarships are factored in, and those schools where prices are rising the fastest.
And in the coming weeks, the Administration is set to release its model financial aid shopping sheet. The shopping sheet, which the Administration will encourage all institutions of higher education to voluntarily adopt, will tell prospective students how much aid they will receive in grants and scholarships; how much they’ll need to borrow in student loans; the difference between private loans and federal student loans; and the average student loan payment after graduation.
The Financial Awareness Counseling Tool can be accessed through StudentLoans.gov at https://studentloans.gov/myDirectLoan/financialAwarenessCounselingLanding.action.