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5 Keys to Paying Off Student Loans Like You Were Summa Cum Laude

NEW YORK (TheStreet) -- Caps and gowns are arriving at college dorm rooms and off-campus apartments in droves as graduates get ready for their days in the sun in May and June.

Unfortunately, soon after the hoopla dies down, college grads will cross another threshold to full-fledged adulthood: a first look at their total student loan bill.

According to GreenPath Debt Solutions, a Farmington Hills, Mich., nonprofit credit counseling firm, the sticker shock from opening that first student loan envelope could be off the Richter scale.

"Our clients, who have student loans, are facing nearly $30,000 in student loan debt, which is a 13% increase over 2011," says Rick Bialobrzeski, GreenPath communications director.

To save graduating college students some "headaches and money," as GreenPath puts it, the organization has a college loan repayment plan boiled down to a few key steps.

Follow them and GreenPath says you'll minimize the financial and emotional stress from dealing with huge student loan bills:

Know your loan. This may seem obvious, but GreenPath says one of the most common missteps among college graduates facing a loan burden is being uncertain how best to manage it. The firm advises knowing exactly what type of loan you borrowed. Is it a private or government loan? Is it a Perkins or Stafford loan? Who is the lender? What's the balance and repayment status? Knowing what you're up against is the first step in paying it off. (For a good look at all federal student loans, visit the National Loan Data System.)

Start paying on time. Different loans have different grace periods, meaning the time you have before your first monthly loan payment is due. Count on six months for Stafford loans; nine for Perkins loans. If you have a private loan, contact your lender directly. A note: You don't have to wait for your first bill to start paying. Starting early, if you can handle it, is a great head start on your loan repayment campaign.

Set up automatic payments. "Missing payments can quickly get you into financial trouble," GreenPath says. "Pay on time all the time. Setting up payments automatically through your bank account will dramatically reduce the chances of missing a payment."

Don't extend your loan timetable. To thwart constant, bank account-draining loan interest charges, don't extend your loan past the traditional 10-year payment period. GreenPath says that extended repayment plans may lower your monthly payment, but they'll have you paying more interest, and more cash, over a longer period. Also, pay down loans with the highest interest rates first. That can save you hundreds or thousands of dollars in interest.

Leverage tax breaks. GreenPath says that, depending on the size of your paycheck, you may be able to deduct up to $2,500 on the interest you pay on your student loan each year. That can cut your tax bill and leave more cash in your pocket.

You'll also want to keep an open dialogue with your lender (especially if you're having trouble paying), and make sure to open all correspondence it sends. That way you're always on the same page, and you're not blindsided by any bad news.

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