8 Tips for Paying Off Student Debt Faster
A major fear among college students is the idea of being stuck in student loan debt throughout most of their adulthood. This is a valid concern since many people are currently struggling with making their payments while handling countless other financial responsibilities, but you can avoid this vicious cycle if you take the initiative sooner than later. The advisors at College Funding of Tampa Bay would like to share some useful tips for paying off student debt faster so you can fulfill your dreams without anything holding you back.
Make an extra payment every chance you get.
Perhaps the most significant piece of advice we can give you is to make extra payments whenever you can. When you only make the minimum payment each month, you’re paying more interest over time, which can make it difficult to pay off your balance faster. Like a snowball effect, making extra payments can lower your accrued interest for the following month and you can use the difference in savings to put back towards the loan.
Look into student loan incentives and other offers.
Many federal programs exist to assist students in paying back their loans, such as an interest-free repayment plan or student loan forgiveness. These incentives can also come from other places, such as a discount for enrolling in auto-pay with your loan provider or student loan assistance from certain employers.
Consider refinancing your student loan.
If there’s been a positive change in your credit score or you have seen an increase in your income, you may qualify for a refinance, which can lower your monthly interest rate.
Avoid prolonging your final repayment date.
Some programs may offer you an extended repayment plan for those who feel they need more time or smaller payments. If you can help it, try to avoid extending your due date, since this can cause you to end up paying more interest in the long run.
Cut out unnecessary spending.
Take a moment to closely evaluate your income versus your spending. If you have a habit of eating out often or buying clothes you don’t necessarily need, ask yourself if these purchases are worth being in debt longer than you need to be.
Get on a bi-weekly payment plan.
By splitting your monthly payment in half and making a payment every other week rather than once a month, you’ll actually be making an extra payment over the course of a year.
Get a head start while you’re still in college.
Most loans offer a grace period to allow you to finish your schooling before you are required to start making payments. However, making an interest payment each month while you’re in school rather than letting it accrue will make a significant difference by the time you graduate.
Investigate any hidden funding.
There is a little thing called “found money,” which refers to any money that an individual may have forgotten about or didn’t know they had. It could be leftover cash from an old checking or savings account, unclaimed refunds, and the like. If you look into it a bit further, you could have some extra money waiting to be claimed that you can put towards your loans.
We Can Help with Your Student Loans
Need help paying back your student loans? Come visit the financial experts at College Funding of Tampa Bay and we’ll help you evaluate your situation and come up with the best plan for you! Call us at (813) 755-6834 to get started on a free consultation.
