(MONEY Magazine) – Daniel and David Huff, 22-year-old identical twins from Ithaca, N.Y., just graduated from Cornell University, each with a bachelor's degree in hotel administration and an $11,000 federally guaranteed student loan to pay back, beginning in November. They both spent the summer painting houses in the area for $9 an hour. But financially that is where the similarities end. This month, Daniel, the more pragmatic brother, will begin a management training program with Holiday Inns. ''I'd like to own a small business someday, and I think managing a hotel is a wonderful way to learn the ropes,'' he says. After a six-month internship as an assistant general manager at a hotel in Lexington, Ky., he will be assigned to one of the chain's 1,400 hotels in the U.S. As a trainee, all of his expenses will be paid and he will earn $385 a week. At the end of training, he is likely to get a bonus of $3,000 or more, depending on his performance, and a raise of at least $50 a week. David, the more carefree brother, is uncertain about his future. ''My finance courses convinced me that I want to manage money, not a hotel,'' he says. He is seeking a job as a stock trader or investment banker. So far, however, he has mailed out fewer than a dozen resumes to banks and securities firms in New York and Chicago. ''I'm going to have to send out a lot more. I realize that,'' he says. Until he lands a job, he is content painting houses. Like most holders of newly minted college degrees, neither Huff has any other significant debts or assets. Each will have to depend on his earning power to keep up the minimum $130-a-month payments on his school loan, which cost a low 8% a year, or risk joining the 500,000 ex-students on the federal government's deadbeat list. Among the penalties: bad credit reports, withheld tax refunds and even legal prosecution. But that's unlikely to happen to the Huff brothers, who share an identical determination to pay off their student loans. Daniel is seriously considering liquidating his debt early by increasing his monthly payments by as much as $200 (see the table above). ''I'd like to get free and clear as soon as possible,'' he says. While his attitude may be commendable, Peggy Ruhlin, a financial planner with the firm Sestina Budros & Ruhlin in Columbus, Ohio, suggests he make the minimum payments. ''Who else is going to give him an 8%, 10-year loan?'' she asks. ''Besides, in a few years, inflation is likely to make the dollars that he pays back cheaper than the ones he borrowed.'' Of course, she adds, ''if it makes him feel more free and confident to pay the loan off, that's important too.'' She urges Daniel, however, not to sacrifice saving for the sake of becoming debt-free sooner. Says Ruhlin: ''Saving is a wonderful habit to get into and, with a lot of extra income at the moment, it's the perfect time for him to do it.'' Ruhlin recommends that Daniel participate in any payroll savings plan he is offered. Alternatively, he can open a 5 1/2% passbook savings account at a bank. When he has $1,000 accumulated, Ruhlin says, Daniel can switch it to the bank's money-market account and boost his yield by one or two percentage points. For David, paying off the student loan early is out of the question. He might even have to strain to make the minimum loan payments if his $360 weekly earnings from painting houses dwindle in the winter off-season. David intends to cut costs by living at home, but his parents say he must soon start paying for room and board. Also, his expenses will rise as he interviews for jobs across the country and replaces jeans and sweatshirts with suits and ties. Ruhlin cautions David to save every cent he can to tide him over seasonal - layoffs and to bankroll his job search. An essential extra expense, though, is health insurance. ''One hospital stay can put David in hock for a long time. It's not worth the risk,'' says Ruhlin. She suggests David try to obtain employer-sponsored group coverage through the contractor he works for. Such coverage sells for roughly $1,200 a year. Individual coverage could cost twice as much.

Even a blizzard of resumes may not be enough to get David the job he wants. Though he took most of his elective courses in finance, recruiters are unlikely to be impressed. ''The financial services job market is tight. Lots of jobs have been lost in mergers, and there are plenty of graduates with the right degrees to fill the ones that exist,'' says Robert Hecht, a New York City headhunter with Lee Hecht Harrison. Hecht offers some sensible advice for David: ''If you can afford it, take any job to get in the door. Be a data entry clerk or a secretary while you lobby for a chance to prove yourself.'' This would mean accepting a starting salary of as little as $14,000, however -- substantially less than David earns now as a housepainter.

If all else fails, he might have to consider returning to school full time. In that case, David could defer his student loan payments until after graduation -- and even borrow up to $7,500 more a year at 8% from Uncle Sam for his advance degree.

BOX: At a Glance

These are the repayment terms for federally guaranteed student loans: -- Interest rate: 8% -- Length of loan: 10 years -- Repayment begins: six months after graduation -- How long payments can be deferred: until six months after you finish military service or overcome a physical or mental disability; one year if you can prove economic hardship

CHART: How higher payments pay off If Daniel Huff increases his monthly payments by as little as $50, he can cut the total interest charges on his student loan nearly in half. An extra payment of $200 a month will reduce interest and the length of the loan by more than two-thirds.

Total Length Loan interest of loan PAYMENT $130 $16,015 $5,015 10 years 180 14,092 3,092 6.5 years 230 13,248 2,248 4.8 years 330 12,464 1,464 3.1 years

CREDIT: NO CREDIT CAPTION: See above. DESCRIPTION: Effect of increased payments on the interest charges of a loan.