The hard truth about student debt is that, while higher education typically lasts four years, student loans can follow you for decades.
If you’re a recent graduate, or have been out of school for a while and are still burdened with a seemingly insurmountable sum of education debt, don’t panic; there is a light at the end of the student loan tunnel. And of course, the faster you pay off your loans, the sooner you can direct your monthly payments towards other important goals, like buying a home or saving for retirement.
Here are a few options to free up cash and expedite the student loan repayment process:
Embrace A Minimalist Lifestyle
This may be an easy one for recent grads who survived college on ramen and free streaming. If you’re already used to humble living, make it your lifestyle. You may have to put more effort into finding things to do that are both fun and affordable, but speeding up the repayment process is worth it.
And if you’re fortunate enough to land a high-paying job right after graduation, don’t pour that cash into a luxury apartment and fancy new car. Use your paycheck to pay off your loans.
Pay More Than the Minimum
Perhaps the most effective method to paying off your student debt quickly is to contribute more than the minimum amount. You can always pay more than what’s required every month. However, if your income is inconsistent or you just prefer to contribute larger sums once in a while, try making four additional payments per year. By increasing your payments from 12 to 16 annually, you’ll slash your debt much faster.
Explore All Your Options
Making smart money decisions sometimes require sacrifices. So if you’re committed to paying off your student debt quickly, you may need to examine your lifestyle spending.
For example, moving in with your parents for a limited time might help you save a significant amount on rent, and increase your debt payments. Do you have easy access to public transportation? If you sell your car, you’ll no longer have to cover gas, insurance or registration—all payments that can be re-routed towards your student loans.