5 Ways to Pay Off Your Student Loans Faster
There are manageable ways to pay off your student loans more efficiently and ensure you are getting the most out of each payment.
Here are five ways to pay off your student loans faster and save money:
Pay Right Away
Consider making student loan payments during your grace period or while you’re still in school, even if you’re not required to do so. If you can, try to pay at least enough to cover the amount of interest you’re accruing each month. That way less interest will capitalize and get added to your principal balance when you enter repayment.
Sign up for Automatic Debit
If you sign up for automatic debit, your student loan servicer will automatically deduct your student loan payment from your bank account each month. Not only does this help ensure that you make payments on time, but you may also be able to get an interest rate deduction for enrolling. Contact your loan servicer to see if your loan is eligible for this interest rate reduction.
Pay More than Your Minimum Payment
Paying a little extra each month can reduce the interest you pay and reduce your total cost of your loan over time. Continue to make monthly payments even if you’ve satisfied future payments, and you’ll pay off your loan faster. Ask your servicer if the additional payment amount can be allocated to your higher interest loans first.
Use Your Tax Refund
One easy way to pay off your loan faster is to dedicate your tax refund to paying off some of your student loan debt. Part of the reason you may have received a refund in the first place is because you get a tax deduction for paying student loan interest.
Seek Out Loan Forgiveness and Repayment Options
There are a number of situations in which you can have your federal student loan balance forgiven. There are loan forgiveness and repayment programs for teachers, public servants, members of the United States Armed Forces, and more. Check out our article about loan forgiveness and other repayment benefits.
Most of these programs have specific eligibility requirements, but if you think you might qualify, you should definitely do some research. Also, research whether your employer offers repayment assistance for employees with student loans. There are many who do!