How to Pay Off Student Debt Quickly
Whether you’re a parent or well past school, student loans can still haunt you. Unfortunately, college and graduate school can be expensive and often require you to take out multiple student loans. If paying off student loans feels far away or even impossible–keep reading. It does not have to be, in fact, if you budget correctly and focus on your finances, you can get more of your debt paid off.
Unfortunately, there’s no magic plan for paying off your student loans, it will take time. However, by following these steps you can get on the fast track for leaving your student debt behind forever. Paying off your student debt takes hard work, dedication, and patience–but let’s get to it!
Get On Budget
Budgeting is a guaranteed way to manage your finances in a responsible way. If you’re not already doing this, it may be time to make a budget and stick to it. A zero-based monthly budget will show you where your money is going and where you could cut back. You may even find extra money or subscriptions you don’t need anymore. Use any of the extra money to pay off your student debt and you’ll be making progress in no time. There are many amazing apps that help you visualize your progress on your student loans, and you’ll feel good being able to see the process unfold.
Pay More Than The Minimum Payment
Finally! Law school is over! On top of waiting for your LSAT scores, you are also stressed out about the student debt you are now going to be responsible for. Maybe you are overwhelmed and wondering how you are going to manage the loans. Well, one effective strategy is to pay more than the minimum payment each month.Â
If you are only paying the minimum payment each month, you are not getting anywhere fast. In fact, you might not even be breaking even with the interest you’re piling up. By making larger payments, you’ll be able to pay off the heap of debt faster. For example, let’s say you owe 10,000 dollars with a 4.5% interest rate. By simply paying an extra $100 every month, you will be debt free over five years ahead of schedule.
Make Some Financial Sacrifices
Now may be a good time to take a second look at your lifestyle and what choices you make on a daily basis. Are there things you could sacrifice to stay a step ahead of your student loans? Maybe it’s time to say bye-bye to those pricey subscription boxes or expensive purses you love to buy every season. Do you have a guest room that is awaiting the day you have kids but is unused now? Rent it out. Whatever it may be, look at your spending and try to figure out some ways you can save or sacrifice.
One additional piece of advice is to look through your closet and find any clothing or valuable items you don’t use anymore and see what you could put on Craigslist or eBay. Maybe, you start to make your coffee from home and ditch the $5 lattes every day. You’d be surprised how quickly the small stuff adds up. With all the saved money per month, you could make larger payments on your loans.Â
Increase Your Income With A Side Hustle
A side hustle is not a bad idea for the time being. You can pick up a weekend job or something part time. Then, toss that cash directly at your student loan debt! There are a ton of side hustle jobs from driving Uber to walking dogs. Remember, that extra job won’t last forever. You’re just trying to kick that debt out of your life!
Refinance Your Student Loans
Before you go and approach a lender, know that refinancing student loans is not the right move for everyone. When you refinance, you’re taking your loans, federal and private, and refinancing them to a lender who pays them off for you. With refinance, the goal is to secure a better rate and payment terms, which means you pay less each month for a shorter amount of time. The goal is to get a better rate and payment terms– if that’s not what you’re getting, then you shouldn’t settle.
