How to Pay Off Student Loans Faster

How to Pay Off Student Loans Faster

Written by Nathan Woolard

The cost of attending college in America has never been higher, and neither has the growing mountain of student debt.  Paying back loans has become an ever-steeper battle and many people are struggling to keep up.  It’s not a fun subject to dwell on, but it is one that merits some increased effort to push through.  The sooner you pay off your student loans, the sooner you’ll be able to dump that uncomfortable weight off your shoulders, so don’t be afraid to kick yourself into high gear and knock out your debt ASAP.  If you’re ready to alleviate the pressure, read on for a few tips to help you hit the ground running:

• Keep up a lower income lifestyle.  It can be tempting to make the leap into adult life with some spending on unbudgeted fun, but it might be smarter to prioritize your student loan payments.  Hold off on large purchases for a year or two if feasible and focus on maintaining the habits that got you through college.  If you can, hang onto your roommates to help carry the rent and stick to the bare minimum spending that you’re used to.  If you’ve been surviving with generic Pop Tarts and basic cable, stick with it.  Direct your money to paying off your loans in the short term and then you’ll have one less responsibility restricting your spending further down the road.
• Use an automatic payment program.  Writing and submitting a check every month can be a pain in the neck, but some student loan servicers help circumvent that by offering automatic payment programs.  With your debt being dealt with automatically, you’ll never have to worry about late payments, and you’ll still have the option to make additional manual payments.  Some programs even offer discounted interest rates if you sign up for autopay and/or paperless statements.
• Pay off loans while still in school.  As long as you have an affordable income, there’s no reason not to start tackling your debt at the earliest opportunity.  Some loans will gain interest even while you’re in school, so making payments right from the start can both work off your debt faster and reduce your cumulative interest.
• Pay more than the minimum.  It might feel nice to pocket any extra cash you get, but if you want to pay off your debt quickly, then you’d be wise to put as much as your budget allows into your monthly payments.  You might feel deserved to freely spend your money from a birthday gift or a raise at work, but lumping it into your payment will be a big help in mowing through your debt faster.
• Make multiple payments per month.  There are a couple good ways to approach this strategy, be it by making bi-weekly payments after payday or simply by making random payments throughout the month as is convenient.  Regardless of which better suits you, both methods will speed you along to reduce the principal on your loans and save you money on interest.
• Use the “debt snowball method.”  Create a list of all your student loans, starting with the smallest balance and ending with the largest.  Each month, put your extra money toward paying off the smallest balance while sticking to the minimum for the rest.  Through this method, you’ll get the smaller loans out of the way faster and reduce how many payments you have to worry about over time.  You can also include other debts, like car and home payments, to tackle your overall debt all together.

Working off your student loans can certainly be a daunting task, but keep a level head and you’ll make your way through it.  Don’t hesitate to take advantage of all the methods available to speed up the process.  Following any combination of the strategies here can set you on pace to pay off your debt faster.  With proper budgeting, self-discipline, and a little sacrifice, you could wind up free of your student loans sooner than you ever thought possible.