Paying Your Student Loans Faster – Smarter Finance Journal

Paying Your Student Loans Faster

studentloandebtIt’s no secret that financing an education is an expensive endeavor that takes years to pay off, especially with tuition costs reaching an all-time high. In addition, with the vanishing of the middle class, having a college education is essential to be able to compete in a globalized marketplace. This article will give you ideas on how to pay down your student loans quickly. Eliminating your debt is the first step toward financial independence!

  1. The first step you should take is to try to develop a repayment plan. Try to solidify a time frame of repayment. Once you have developed a plan, it is important that you be disciplined in adhering to your plan.
  2. Begin making payments as soon as possible. Small payments while you’re still in school can add up to a lot, quickly. This method will help you save money on accrued interest in the long run.
  3. Consolidate your loans to make payments easier. After consolidation, pay off your higher interest rate loans first.
  4. Enroll in an automatic payment plan. Some programs will offer a discount of 0.25% for automated payments. This method also ensures that you will never miss a payment. Next, begin paying more than the minimum amount.
  5. Be cautious of third party loans because they have extremely high interest rates compared to government subsidized loans.
  6. Get involved! Programs like AmeriCorps and the Peace Corps offer loan forgiveness programs.
  7. Switching to bi-weekly payments. This will help you see the bigger picture, and allow for a more detailed budget.
  8. The last step is to analyze your progress. It is important to take a step back and reflect upon how your plan is going. Will you have payed off your loans by the time you initially established? If not, perhaps it’s worth modifying your plan?

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