College graduates are crippled by loans that they need to take out to pay for their degrees. Most people are about $32,731 in debt for going to school. This amount of money can feel insurmountable, especially considering that the median annual wage is nearly the same amount.
Is there any way to pay off loans more quickly so that you have more time to enjoy the career benefits of a degree? These 3 tips are the real secret to paying off your student loans fast.
Take any opportunity to start chipping away at your loans while you’re still in school. Doing this will help you have fewer financial burdens as you work your post-grad job. Even if you can set aside just $10 a week, it adds up to help you get a major head start in your payments.
If you took out subsidized loans, you wouldn’t accumulate any interest until after graduation. At that point, you’ll be charged a fixed percentage of your total borrowed amount. The more you get ahead on paying your loan, the less interest you’ll have in the future.
Make A Payment Plan
When it comes to paying off student debt, it’s crucial to begin with the end in mind. Envision yourself without the stress of having debt. Imagine what you could do with full financial freedom and a boosted credit score!
Let that be your motivation to create a payment plan that works for your unique timeline. Whether you hope to pay off your loans in a few months or a few years, outline a month-by-month budget that will let you achieve your financial goals.
A major mistake people often make with their loans is that they don’t follow through with the payment plan they initially created. Loans get put on the backburn when other expenses come up, like a new car or updated furniture.
Losing the urgency to pay off loans, especially student loans, causes borrowers to collect more interest, raising their bill significantly over time. Prioritizing your loan over all other non-essential expenses is how you’re going to eventually become debt-free.
If you are just starting your college journey we recommend checking out our article on the Top Paying Careers for College Grads.