Paying Off Your Student Loans More Efficiently
Many people seeking higher education take out student loans to pay for tuition and other related expenses. But, student loan payments can feel like a weight on your shoulders. That said, there are ways to pay off your student loans quickly and more efficiently than just paying your minimum monthly balance. Below is a guide to paying off student loans more efficiently.
Make early payments
Interest on a student loan begins to accrue while the borrower is still in school. That said, an effective way to prevent the buildup of interest later is by paying what you can now. Making payments before your loan’s grace period ends also means a smaller balance to pay off later.
Make extra payments
Similarly, paying more than your minimum monthly balance can reduce the interest on your loan, which can decrease the overall cost of your loan. There’s no penalty for paying more than the minimum balance, but some student loan servicers may use your extra payments to advance your due date. Ensure your servicer applies these extra payments toward your principal balance so that your due date is not changed. Additional payments can be made at any point during the month, including on your loan’s due date.
Seek loan forgiveness
If you’re struggling to pay off your student loan, it might be a good idea to seek out forgiveness options. There are loan forgiveness and repayment programs for members of the armed forces, teachers, public servants, Americorps members, and more. For more on student loan forgiveness and repayment programs, visit studentaid.gov.
Although paying off your student loan can feel like a herculean task, it doesn’t have to be. As long as you’re vigilant about making more-than-minimum payments, the amount of interest on your loan will be manageable. Thus, your student loan may be paid off sooner!
Refinance
Refinancing your student loan may help pay it off quicker without making additional payments. While short-term loan refinances may increase your monthly payment, they help pay off what you owe in a shorter period of time. They can also help you save on interest. That said, loan refinances should only be done by people with good credit scores and steady jobs.
Use what you have
There are several other ways to pay off student loans. If you recently received a tax refund from the IRS, consider using part of it to pay off your loan. Some companies also help pay off student loans as part of their benefits package. Be sure to ask your employer if they offer an employer student loan repayment program. Starting a side hustle is another great way to make extra money to go toward student loan payments. For more about side hustles, check out our blog on the topic.
Enroll in autopay
Autopay ensures your loan’s monthly dues are made on time by automatically deducting payments from your bank account. This can help lower your student loan interest rate so that more money goes toward your principal balance. Some student loan servicers and lenders offer interest rate deductions for enrolling in autopay. Be sure to check with your student loan servicer to find out if your loan is eligible for an autopay discount.
Hunter Morrison
About Hunter Morrison
Hunter has freelanced for various print and radio publications across Northwest Florida, including The Bay Beacon, Navarre Press, Inweekly, Crestview News Bulletin, and WUWF. He was also the Editor in Chief of the University of West Florida’s student newspaper, The Voyager. In 2023, Hunter moved to Kenai, Alaska to take up a news reporting position with KDLL Public Radio. For fun, Hunter enjoys cross-country skiing, hiking, photography, thrifting, traveling, and looking for the best Thai food around.