In the United States and many other countries, a college education is very expensive. Most students use government sponsored students loans to afford their education. However, these loans have to be repaid once you are out of school. The government gives you about two years of deferment to provide enough time for you to find a job, but the monthly payments that you will have to make to pay off the loan can still be very pressing on your finances, even with a decent paying job. Below, you will find 7 tips that can help you pay off your student loans quickly.
Use a repayment calculator and set a monthly goal
Paying the minimum amount on your student loans will mean that you will be paying off your loans for decades. Instead, you can use a repayment calculator and find out exactly how much you need to pay every month so that you can pay off the loans quickly. A substantial payment such as $300 to $500 per month will be the most effective strategy for quick repayment.
Start paying off the loan while you are in school
The more money you can apply toward your student loans while you are in school, the less money you will owe when you get out. Of course, students have a lot of other concerns to worry about as well such as textbooks, but if you can afford to pay $50 to $100 toward your loan every so often, it will help you considerably.
Consolidate your loans
Consolidation is where you work with a loan consolidation company to merge all of your loans together and instead of paying them all separately; you can start paying one monthly amount to the consolidation company. This can help you organize your finances and make your loans easier to manage.
When you enroll in automatic payments, the government might give you a discount toward your loans. Of course, this means that the amount you owe each month will be automatically deducted from your bank account, so you will have to have enough money in your account every month. However, if you have the financial means to do this, it can save you a lot of money.
Find an employer that can help
A lot of employers will help pay for your college education if they like the work that you do as an employee. This is an excellent opportunity to get your school paid for while also earning money in the workforce. Not all employers are as generous as this, but if you work for a company that you plan to stick with even after your schooling is complete, then this might be a possibility for you.
Utilize tax deductions
Tax deductions can save you money and make managing your finances a lot easier. If you’ve paid money toward your student loan interest, you can deduct some of this money from your taxes. Once you pay over $600 in a given year, you should receive a 1098-E form which documents the total amount that you can deduct.
Ask for loan repayment as a gift from family and friends
It’s nice to receive a gift for Christmas, birthdays, and holidays, but sometimes loan repayment is the best gift of all. Getting out of debt can help you feel responsible and financially secure. If you encourage your friends and family members to help you repay your loans, rather than giving you a physical gift, then you will be able to pay off your student loans quickly. It’s important to apply spare cash toward your loans whenever you get the opportunity.