While student loans may be a necessity to get through college, make sure to keep them under control so they don’t become financially overwhelming. If your child is struggling to pay off student loans, he/she won’t have funds available for things like buying a home or saving for retirement. Consider the following tips to help your child with student loans:

• Make sure your child keeps track of all student loans. Often, students borrow from a number of lenders, taking small amounts out over time. If the student doesn’t keep track of these loans, he/she may be surprised by how much debt has accumulated.

• Translate those outstanding balances into a monthly payment. The real problem with loans, of course, is that they have to be repaid. Student loans must typically be repaid within 10 years after graduation. While you won’t know the interest rate until graduation, assume an interest rate of 8%. For every $1,000 of student loans, the monthly payment will be $12 if paid over 10 years at 8% interest. A student with the average loan balance of $15,500 can expect to pay $186 per month to repay student loans.

• Encourage your child to pay off all debts as soon as possible. While student loans are likely to be your child’s largest debts, they may also be the cheapest. From July 1, 2005 until June 30, 2006, the interest rate for Stafford student loans is 5.3% and for PLUS loans is 6.1%. If your child has other debts with higher interest rates, such as credit card debt or an auto loan, suggest paying off those loans first.

• Look for ways to lower the cost of those student loans. Student loan borrowers have a one-time opportunity to consolidate all student loans and lock in an interest rate for the loan’s term. Students who are just graduating have a six-month grace period before repayment must begin. However, if those loans are consolidated during that period, the interest rate will be discounted by .6%. Allowing the lender to automatically deduct the loan payment from a bank account will often result in an interest rate break of .25%. Make every payment on time for four or five years, and the lender will often reduce the interest rate by 1% for the remainder of the loan’s term.

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• Remind your child that up to $2,500 of education loan interest can be deducted on his/her income tax return as an above-the-line deduction, with income phaseouts of $50,000-$65,000 for single taxpayers and $100,000-$130,000 for married taxpayers filing jointly.

• Suggest your child put off upgrading his/her lifestyle or buying a home until all debts are paid off. This is a lesson that will benefit your child for a lifetime. Learning to live within one’s means and purchasing items only when they can be afforded are two of the soundest financial principles your child can learn.