Let’s face it—paying off student load debt isn’t necessarily a fun activity. And if you are like most recent graduates, you are looking to pay off your loans as quickly as possible.
Here are a few tips to get you to the student debt finish line a little sooner.
This method is easy and effective. Even if you can only afford an extra $20 beyond the required minimum monthly payment, it will make an impact. And any extra money you pay goes straight toward your principal. To make the process even easier, set up automatic payments with the extra amount factored in. This will remove any indecision on making that extra payment consistently.
This one is a small immediate impact that can have a positive long-term effect. Take your monthly payment, split it in half and make that payment every two weeks. By doing this, you’ll end up making a full extra payment over one year. The biggest bonus of this strategy? If you receive a paycheck bi-weekly, you shouldn’t feel the pain of paying the extra amount.
Hopefully you work at a job where yearly raises or bonuses are part of the compensation. But what do you actually do when you get a raise? Buy more stuff? Why not put a chunk of it toward your student loans? Consider taking just 50 percent of your raise amount and adding it to your student loan payments to speed up repayment.
One of the most effective moves for paying student loan debt off more quickly is to refinance your loans. The ultimate goal of refinancing is to decrease interest rates. This means more of your payments go towards principal. When you refinance your student loans, you’ll end up with one consolidated loan and one monthly payment.
A growing job benefit trend is employer student loan repayment assistance. Basically, employers who offer this enticing benefit will pay a certain amount of money toward employees’ student debt each month. By working for a company that offers this benefit, you can receive help paying down your debt and also pay it down in a timelier manner.
Just remember to continue to make a little more than the monthly payment yourself, and utilize this employer benefit. This route of student loan repayment could cut the amount of time it takes to repay your debt in half and save you thousands of dollars over the life of the loan.