How to Get Out of Student Loan Debt Faster
While a university education is worthwhile on many levels, one of the sticking points for plenty of people is just how expensive it is to complete a degree these days.
If you’re one of the millions of people who are weighed down by debt after finishing your studies, then there are ways to ease the burden and bring your finances back on track in less time, so here’s what you can do today to make a difference.
Set a Payment Schedule and Stick to It
Creating a payment schedule is the first step in getting out of student loan debt faster. Knowing when your payments are due each month and what you owe can help create structure for reaching your goal.
Make sure to keep track of all upcoming payments, so you don’t forget or miss any deadlines. Also, setting up auto-payments will ensure that your bills get paid on time every month without fail. That way, it’s one less thing for you to worry about as you work towards becoming debt free sooner rather than later.
Refinance Your Student Loans
If you have multiple student loans, refinancing them into one single loan can save you money in the long run.
Consolidating student loans easily means getting a new lender to pay off your existing debt, and then issuing you a new loan with different terms, with lower interest rates being the main selling point. This could mean saving hundreds or even thousands of dollars over the lifetime of the loan agreement.
Make Lump Sum Payments When Possible
Making lump sum payments is another great way to pay off your student loan debt faster. If you have any extra money, such as a bonus from work or a tax refund, consider using it towards paying down an existing balance and improving your financial future as a result.
Paying more than the minimum amount due each month can help reduce the principal, and in turn reduce the impact of interest accrual over time, meaning that you’ll save on overall costs and get out of debt sooner. You may even be able to negotiate with some lenders for lower rates if they know that you are committed to making additional payments.
Take Advantage of Employer Tuition Reimbursement Programs
If your employer offers a tuition reimbursement program, make sure to take advantage of it. These programs pay out tax-free funds towards student loan debt, with significant amounts being knocked off the balance year after year.
Depending on the type of loan you have and how much you owe, this could be an effective way to reduce the overall amount that needs repaying. Make sure to check with your HR department, as not all employers offer these types of benefits. Even if they don’t cover all payments made each month, any little bit helps when trying to get out from under overwhelming debt.
Explore Loan Forgiveness Options
In some cases, you may be able to have your student loan debt forgiven altogether. Government-funded programs such as Public Service Loan Forgiveness (PSLF) and Teacher Loan Forgiveness can both provide full or partial forgiveness of federal loans. Note that these programs are only available for certain types of borrowers, so make sure to check the eligibility criteria first before applying.
Additionally, there are other loan forgiveness options depending on where you live, such as state-sponsored initiatives targeting specific sectors like healthcare or education, which could benefit you even more if eligible. This could even come into play if you’re thinking about relocating for work.
As you can see, there’s always an end in sight if you’re proactive about driving down your student loan debt, and with the right strategies you can reach your destination faster than expected.
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