Shrink Your Student Loan Payments Now

(MoneyWatch)  In pursuing a college degree, it's easy to overindulge.
I know a young woman, for instance, who graduated from Columbia University a few years ago with a teaching degree and student debt that could crush a chalkboard.

Starting on July 1, however, the debt burden that this teacher and others struggle with won't have to be so heavy. That's the day that the federal government rolls out its income-based repayment program (IBR).

For many graduates, who are unemployed or stuck in low-paying jobs, the IBR will be a lifesaver because it will make their monthly payments far more manageable. In fact, some borrowers will be able to temporarily stop writing any checks.

Whether you will qualify for lower monthly payments will depend on your income and family size. Here's an example from the Federal Student Aid website:

The monthly payment for a qualified single borrower who makes $30,000 a year would be no higher than $172 regardless of the size of the debt. In contrast, if this same person was repaying a $25,000 loan during the traditional 10-year borrowing period, the monthly amount, at 6.8% interest, would be $288.

You can qualify for this program regardless of when you took out your federal loans or if you have already consolidated your student loans. Unfortunately, parents, who have borrowed to pay for a child's college degree, can't qualify for the program. Also ineligible is anyone who owes money on a private student loan.

To determine your eligibility, check out the federal government's IBR calculator. You'll find another IBR calculator here. If the numbers look good, contact your lender to enroll.

Image of U.S. Department of Education building by Chriszs. CC 2.0.