If you took out student loans, you may consider them to be a burden as you enter repayment. But depending on your income, expenses and debt level, your student loans may be more than a simple annoyance.
In a report shared by The Education Trust, “having a high debt relative to available assets is associated with higher perceived stress and depression,” particularly among young adults.
Whether you have anxiety about student loans or feel regret about your college choices, there are ways to make your debt more manageable — and get help with your mental health.
How Student Debt Can Affect Mental Health
The studies are conclusive: debt of any kind is linked to higher rates of anxiety and depression. But student loan debt can affect your mental health in particular ways, including:
1. Increased Stress
If you have a large student loan balance or a high monthly payment, you’re likely stressed about your finances and may regret your past decisions.
A study from the Strada Education Network and Gallup found that those with student loans are more likely to regret college choices than those who didn’t take out loans.
If you feel discouraged about your employment prospects and earning potential, your stress levels can significantly increase.
2. Loss of Sleep
Worrying about how to pay your bills can cause sleepless nights. Losing sleep can affect your job performance, make you more irritable, and increase your risk of health issues like cardiovascular disease.
3. Unhealthy Coping Mechanisms
Those with outstanding student loans are more likely to adopt unhealthy coping mechanisms as a way to self-medicate.
In a study published in the Addictive Behavior journal, researchers found that student loan debt and economic instability was connected to problematic drinking habits, as individuals used drinking as a way to cope with their stress and mental health issues.
Poor drinking habits and alcoholism can have a substantial effect on your mental and physical health, with long-lasting consequences.
5 Ways to Reduce Anxiety About Student Loans
If your mental health has suffered because of your student loans, there are some ways to get some relief.
1. Research Your Repayment Options
Depending on the type of loan and lender you have, there may be repayment options available that can lower your payments and make them more affordable.
For example, some private student loan lenders will allow you to extend your loan term, resulting in a lower payment.
With federal student loans, you may be eligible for an income-driven repayment (IDR) plan. These plans re-calculate your payments based on a percentage of your discretionary income. Depending on your income and family size, your payment could be as low as $5.
These plans are best for those who have relatively low incomes and need longer-term help managing their loans.
2. Explore Loan Forgiveness and Repayment Assistance
Federal loan borrowers who work for a non-profit agency or government agency may qualify for loan forgiveness through Public Service Loan Forgiveness (PSLF) after meeting employment and payment requirements.
But there are other repayment assistance programs from states that can also help you with your debt, including private student loans.
Visit your state education agency to find out if you’re eligible for a loan repayment program.
3. Consider Forbearance or Deferment
With some loans, you may be eligible for a forbearance or deferment period. With these options, you can pause or postpone your payments for a few months.
Forbearance and deferment is best for those who are experiencing a short-term hardship. For example, if you lost your job, forbearance and deferment can give you time to find a new position and get your finances in order.
For longer-term issues, such as having a relatively low income relative to your student loan balance, other options like a different repayment plan or student loan refinancing may be a better choice.
4. Refinance Existing Student Loans
If you have existing student loans with high interest rates, refinancing your loans could help you lower your payments and save money over the life of your loan. You may qualify for a lower interest rate and a different term, making your debt more manageable.
Student loan refinancing can be effective, but it’s not for everyone. If you have federal loans, refinancing your debt will cause you to lose access to benefits like IDR plans and PSLF. And you tend to need good to excellent credit and a reliable source of income to qualify.
You can use the Find My Rate tool to view your loan options and see how refinancing can affect your monthly payments and total repayment cost.
5. Meet with a Professional
If you feel like you’re drowning in debt, you don’t have to handle it alone. Many non-profit credit counseling agencies have free or low-cost programs for student loan borrowers. A counselor will review your debt and budget and help identify available solutions.
You can find a reputable counseling agency through the National Foundation for Credit Counseling.
Taking Care of Your Mental Health
Does student loan affect mental health? Absolutely. Outstanding student loans can have a significant impact on mental health, affecting your stress levels and contributing to anxiety or depression.
While tackling debt and devising a repayment plan are important steps, prioritizing your mental health is critical.
If you’re struggling to cope, consider these measures:
- Meet With a Therapist: A mental health professional can help you develop healthy coping strategies for when you feel stressed by your debt.
- Contact Local Resources: Therapy and psychiatry can be expensive, but there may be local non-profit organizations or programs that provide free or low-cost care. Call 2-1-1 to find out what programs are in your area.
- Find Support: Mental Health America and the National Alliance for Mental Illness NAMI operate chapters nationwide. You can find local support groups, mental health resources and other forms of assistance through your local chapter.
If you’re in crisis, help and support is available 24/7. Call the National Suicide Prevention Helpline at 800-273-8255 or text the Crisis Text Line (HELLO to 741741). All calls and texts are completely confidential, and counselors are available to provide emotional support around the clock.
