First, get organized.

As tempting as it is to burn all those letters and pretend they don’t exist, I highly recommend against that. Put them all in one pile or folder until you are emotionally ready to deal with it. If you are upset or angry, trying to work it out rationally won’t work, it’ll only make you more upset and/or angry. Wait until you have accepted the situation, and are ready to take action. When you are ready, find out how many lenders you have, what type of lenders they are, how much you owe to each, and most importantly, what the interest rate is per loan.

My breakdown looked something like this:

• 5 Alternative Loans for college with Lender A (fixed rate)
• 4 Federal Stafford Loans for grad school with Lender B (fixed rate)
• 4 Federal Stafford Loans for college with Lender C (variable rate)

Next, lower your interest rate.

You want a lower interest rate because your interest rate determines how much you’ll pay total. The rates you see at first are generally not the ones that you are stuck with for the life of the loan. They can go up or they can go down during repayment. Each lender typically has their own terms and rules for how that happens. If the loan is a federal one, the terms will adhere to some federal regulation as well. Find out what the rules are, so you can use them to your advantage.

As I found out, my three lenders had very different rules and conditions:

• Lender A. This loan was my highest balance as well as the highest interest rate. The terms state that for the first 48 months, the interest rate is fixed at a certain lower rate, but then that rate jumps up by a few percentage points thereafter.

• Lender B. At the time I went to grad school, the interest rate was fixed at 6.8%. This lender, however, makes it so that they take off up to 2% the interest rate if I set up automatic payments and am never late on a payment. I certainly took advantage of that!

• Lender C. At the time I went to college, the federal interest rate was variable. I lucked out and got a nice surprise when it was time to pay it back… the rate was quite low, and even lower because I was in the grace period (within 6 months out of school). I noticed that once the grace period was over, the interest rate would go up … it was time to act quick. I locked in that low rate by consolidating that loan. So Lender C (variable interest rate) became Lender D (fixed interest rate).

Last, decide what you can pay.

This part may be more difficult because it requires a bit more planning and thinking ahead. You have several options. Almost all lenders have payment plans that you can take advantage of so you don’t default. The trick is to select the one that works in your favor (as opposed to the lender’s). As a rule, you want to pay more than the interest so your debt goes down instead of up.

Option 1: Pay as little as possible.

If you have yet to secure a job, your living expenses are high, your pay isn’t very generous, or you have other high-interest debt (credit cards), this might be your best option. One of the advantages of consolidating your loans is that you can pay a much lower monthly payment. For example, my monthly payment was cut in half when I switched from Lender C to Lender D. The reason this happens is that you stretch your repayment period from 10 years to 30 years. The disadvantage here is that it takes you longer to pay off your loan, and you end up paying more interest over the life of the loan.

Option 2: Pay as much as possible.

If you want to get rid of your debt as fast as possible, and minimize the amount of interest you pay, this may be your best option. The advantage is that you’re saving money. Each year that you don’t have a loan to pay is extra money. The disadvantage here is that you’ll have higher monthly payments, and — depending on your income — you won’t be able to deduct student loan interest from your taxes once they’re paid off.

Option 3: Something in the middle.

This is the route that I took, and probably the best option for most people. Pay as much as possible towards the loan with the highest interest, and pay as little as possible to the loan with the lowest interest. I decided I wanted to pay Lender A off aggressively, since the interest rate was only going to go up. To make that possible, I am taking as long as possible to pay off Lenders B and D. I stretched out my repayment period from 10 years to 30 years with both Lender B and Lender D. I am on a 10 year repayment schedule with Lender A. I also pay extra each month when I can to Lender A, to accelerate the repayment.

Do I still pay a lot more than I would like? Yes! But now it’s on my own terms in a way that works for me.

A word of caution – this is my experience only and may not apply to your situation. I also cannot answer any questions about your situation, as I am just a professional with finances and not a financial professional.