Top 5 Ways To Pay Off Student Loans Fast
When you look over your bank statement you may be annoyed to find that a few hundred dollars are disappearing from your account each month as ongoing payments to your student loan.
Yep, your student loan is still there. Eating away at your budget. Dashing any hopes of establishing a savings account.
Dealing with student loans can be overwhelming but with these five strategies you’ll be on your way to paying off your student debt in no time.
Find a Job that offers Student Debt Forgiveness
Certain professions offer partial or full student loan forgiveness if you meet the requirements needed to qualify. These jobs are usually ones in the public service sector.
Public service jobs include positions within the local or federal government, or at a non-profit organization that has tax-exemption status from the IRS.
Certain teaching jobs also offer student loan forgiveness, particularly teaching positions in schools which serve low-income families.
If there is a shortage in a specific employment field there is usually a loan forgiveness program set-up to incentive more people get into that field. For example the HRSA offers loan forgiveness for registered nurses working full time in areas that are considered to have a shortage of nurses, find out more about that program here.
Consolidate and Refinance
The goal of refinancing loans is to decrease the interest rate on the loan making it so that more of each payment goes directly to the principal balance of the loan.
To do this you take your existing loans to a lender, they then pay them off for you and as a result you now owe the lender the amount that they just put up to cover your old debt. Sometimes people do this without negotiating a specific deal, instead they simple pay off an existing loan with a new Line of Credit or low-interest credit card.
The key to this working is that the new debt has to have a lower interest rate than the previous debt, and that your new interest rate isn’t subject to change any time soon because if the new interest rate goes up then you will have just lost money in the long run so always do your due diligence and ensure that this new loan is a better and less expensive option than your previous one allowing you to pay off student loans fast.
Pay More than the Minimum Payment
The most basic way to pay off your student loan faster is to simply pay it off faster by making bigger payments (bet you never though of that one, huh?).
This is obviously easier said than done, but every little extra bit can help. Consider dropping an extra $10 or $20 dollars onto your student debt whenever possible.
Student loans allows you to make additional payments at any time of the month. Student loans become a huge burden because they seem to just never go away, part of the reason for this is the interest which grows on the loan. By paying off the loan even a little bit faster you’ll save money by not giving the loan as much time to grow bigger and bigger from the interest.
Spend Less Money Each Month (and put the saved money toward your Student Loans)
With the goal of paying off your student loans as fast as possible it would be helpful to have a little more room in your current budget. To make more room in your current budget we need to find ways to cut down on monthly expenditures.
To do this you can work on cutting out any non-essential expenses, these things may include: cable TV, Netflix, alcohol, and going out to restaurants. Keep in mind this isn’t stuff you need to cut out forever, it’s not like you’ll never have these things for the rest of your life – you’re just going to get rid of them for a set period of time and put the extra money to pay off those student loans.
Track your monthly spending and add up all the non-essential purchases you made throughout the month, then next month actively avoid spending money on those things and instead put the dollar amount of those items directly to your student loans.
Make More Money (By Starting a Side Hustle)
What’s the one major thing that would make paying off your student loans way easier? Having more money.
Consider ways you can increase your income, while getting a pay-raise at work is not likely to be an option for most people, you can find other ways to make money such as selling unused items from around your house or picking up a part-time job to work on weekends temporarily.
There are lots of side-hustle options out there, including driving for Uber, walking dogs, house-sitting, or even renting out an extra room as an AirBnB.
In Closing
Student Loans can be stressful, particularly if you’re one of the many many people who owe thousands and thousands of dollars but don’t let it get you down. Instead keep a focus on how good life will be once that loan is dealt with and use the strategies outlined here to deal with your student loan debt head-on and soon it will be a thing of the past.
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