Student debt is something that a lot of Americans have to deal with. They can be costly and the huge numbers can feel intimidating to pay back. One of the most effective ways to pay down your student loans is by paying more than the minimum as the more you pay on the principal, the less interest you will have to pay. Here are some other strategies you can use right now that can help you pay down your student loans faster.
Choose The Best Repayment Plan
When you are trying to get into the debt to success system as it regards to your student loans, you want to make sure that you pick the best repayment plan for you. There are many options that you can choose from. You can opt for the income-based repayment plan which is great for people who may be having a hard time repaying their loans. Since the amount you pay back depends on how much money you are making, this option is a smart option because it can help you avoid defaulting on your loans. Another good rule of thumb is to avoid any income-based repayment plans that extend your payment terms. If you are trying to repay your loans quickly, that option may be difficult to pay it back faster.
Your Job Can Help
There are a few companies that offer its employees’ student loan forgiveness and in return, you may have to work in a service capacity. Find out from your employer if they have this option as part of your benefits package. Jobs like public servants, doctors, lawyers, nurses, volunteer organizations works, federal agency employees and automotive workers are some of the jobs that offer either loan assistance or forgiveness.
Refinance Your Student Loans
This is a great option for people with good or excellent credit and high-interest rates. Refinancing essentially has to do with consolidating your student loans into one by taking out a new loan with a private lender, using that loan to pay off your original loan. By doing this, you may be able to have lower interest rates. One thing to keep in mind is if you refinance your federal loans, you forfeit your access to income-driven repayment or student loan forgiveness.
Take Advantage Of Autopay
You can take advantage of interest rate discounts if you enroll in automatic payments. Sometimes these discounts are 0.25 percent, which seems like a small amount, but it can add up over time and save you tons over the life of your loan. Autopay also helps you pay your bill on time since it automatically comes out of your bank account.
Pick Up A Freelancing Job
Making extra money is also an efficient way to pay off your student loans quicker. Consider doing a side hustle on top of your day job as a way to increase the amount of money you are pulling in every week, two weeks or monthly.