The average U.S. college graduate has over $17,000 in loan debt. This average is driven down by those who graduate debt-free. Many students have upwards of $40,000 in student loan debt.
Tackling student loans can be overwhelming for recent graduates. That’s why we’ve compiled these 8 top student loan debt tips that can help you pay off your loans without the stress.
Keep reading to learn how to tackle your debt fast, and avoid going further into the debt in the process.
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1. Know Your Terms Before You Start Paying
Knowing the details of your loan debt and the terms that come with them is a must. Learning these before you begin paying can help ensure that you are prepared to tackle your student loans.
The terms of your loans will contain details about how you can consolidate, whether you can change your repayment plan, and more.
They will tell you whether paying ahead on your loan will count as future months payments, which can affect how you repay your loans. They will tell you whether continuing your education by entering a master’s or doctorate program will allow you to wait to begin paying back your loans.
Your loan terms can also help you understand the interest rates that your student loans are incurring as you are paying. This can help you make the best decisions about how much to pay and how quickly you need to pay them off.
If you’re like many Americans, you’ll be paying your student loans back for more than 20 years, despite many loans setting up students for a 10-year repayment plan.
Failing to understand your terms before you begin paying could put you in a difficult situation for the rest of your repayment period.
2. Understand Your Repayment Options
In addition to learning the terms of your student loans before you begin to pay them back, you also need to understand your repayment options.
Loans from the federal government, as well as many private loans providers, often offer more than one repayment option.
This could include higher payments to tackle debt faster, or lower payments for those who can’t handle higher payment.
Changing your repayment plan after you started to pay may not be an option. That’s why it’s important to look into your choices first to figure out which option is best for you.
3. Look into Forgiveness Programs
If you’re stressing out about how you will make your monthly payments, or are dreading being tied to your debt for years to come, its time to look into forgiveness programs.
Loan forgiveness programs often involve jobs through the government or non-profit organizations. In exchange for your work, you can get forgiveness for all or part of your loans. This means that you will never be responsible for paying back your loans or that part of your loans.
Examples of loan forgiveness programs are teaching jobs in low-income communities and nursing positions at certain hospitals or medical centers.
Don’t let the promise of loan forgiveness cause you to overlook the details of these programs.
The job positions they involve are often high-stress environments. You likely won’t be making the same amount of income that you would be working in another area or in a different job.
It may be more financially responsible for you to take a higher paying job and pay on your student loans rather than joining a forgiveness program where you would make less income.
4. Consider Refinancing
If you have several student loans or if you have other debt that you are working to pay down, consolidation might be an option.
Refinancing or consolidating debts can help you get more manageable payment plans. This can help you tackle debt without getting even further behind each month.
5. Pay Ahead When You Can
When you find yourself with extra income at the end of the month, it can be tempting to spend it on other things. But putting it towards your student loans is a great alternative.
Paying ahead whenever you can is a great way to get ahead on your loans. In many cases, if you pay ahead, the payments will count towards future months.
This means that if a month came when you couldn’t make your payment, previous over-payments would keep you from defaulting that month.
6. Never Pay Late or Get Behind
Paying late or missing student loan debt payments will cost you more than just stress.
Late fees can be high, and they take away valuable income that could be helping you pay down your debt.
If you know that you won’t have enough to make your monthly payment, it’s better to find a way to pay than to simply skip it. This could mean borrowing from friends and family or getting a personal loan.
While it might sound counterintuitive to take out a loan to pay off a loan, it can actually be a smart financial move.
You’ll still make your student loan payment, and if you pay your student loan and personal loan the next month. And you won’t incur any big additional fees like you would if you skipped a student loan payment.
7. Look for Ways to Earn Additional Income
Finding smart, easy ways to earn small amounts of additional income can go a long way towards paying down student loan debt fast.
Filling out online surveys, participating in research groups, or even getting a part-time job are all great options. Paying down student loan debt fast will clear up more of your income for other purposes, like saving for the future.
8. Avoid Growing Other Debt
One of the best tips you can follow while paying off student loans is to do your best not to accumulate additional debt. This includes taking additional student loans, building credit card debt, etc.
Too much additional debt could cause you to have to choose which payments to make and which to default on. This will cause you to end up paying a lot of late fees, which is money that could have gone towards your loan debt.
Tackling Student Loan Debt
With a little planning and some smart financial strategies, tackling your student loans can be a breeze.
But even the best-planned approach can fail. Maybe you’ve lost your job, got a pay cut, or have other things to pay for one month.
Before you default on your student loan payment, check out our personal loan options. With no credit check required, you can get the money you need to make your student loan payment, regardless of your financial history.