- Pay more than the minimum payment
- Avoid certain repayment plans
- Use your job to your advantage
- Consider refinancing your student loans
- Take advantage of tax deductions and credits
- Enroll in autopay
- Start a side hustle
- Cut from your budget
- Make extra payments whenever you can
- Make bi-weekly payments
- Pay off capitalized interest
Pay more than the minimum payment
Paying more than the minimum will reduce your credit usage ratio to the balance of your credit card balance within the credit limit. This is because it is not the amount of total debt, but the amount of credit you are currently using that is really important. Also Check weekly payments on: EasyBuy
Avoid certain repayment plans
Government repayment programs such as income-based rescheduling can be a saving grace for them as they fight to repay their repayments, as they can help you avoid federal defaults. However, if you are trying to repay your loans quickly and have the budget to do so, then repayment programs can actually work against you.
Use your job to your advantage
Top 10 Benefits of Working A 9-to-5 Job
- Regular Paycheck.
- A Sense of Identity.
- Intellectual Challenge.
- Learn New Skills.
- Meet New People.
- Access to Community.
- Understand the World Better.
- Work-life Balance.
Consider refinancing your student loans
You can refinance student loans as many times as you want. If you have already re-financed and your credit has recently improved, consider re-financing to lock in a lower rate. Yes, if you qualify for a lower interest rate. With lower prices, you will be paid a lower monthly fee by freeing up cash for other months.
Take advantage of tax deductions and credits
Tax exemption facility
Tax deductions help you deduct a certain amount from your taxable income and save on taxes. When you claim an income tax deduction, it reduces the amount of your income that is taxable. As a result of tax deduction, the amount of income is reduced subject to the maximum tax bracket.
Enroll in autopay
- Go to AutoPay. If you have multiple accounts, select the account you want to sign up for AutoPay.
- Toggle AutoPay On.
- Follow the prompts to sign up for AutoPay.
- Repeat these steps for each account you want to sign up.
Start a side hustle
- Teach an online course. Learning a new trade, skill or subject is not always easy.
- Start a blog. Blogging is one of the most popular aspects because it can be done from anywhere.
- Start a YouTube channel. YouTube has over one billion users who watch a few hours of video every day.
Cut from your budget
And the sooner you pay off your debt, the more you will pay interest. Cutting your budget can help you reach your other financial goals faster. Whether you’re saving for a vacation, financing down a house or starting investing for the first time, the extra money in your budget makes a huge difference.
Make extra payments whenever you can
In addition to paying more on your monthly bill, think about making extra payments. This can be particularly easy if you find yourself with extra cash.
Did grandma send you a check for your birthday? Put it toward your loans.
Got a one-time bonus at work for a job well done? Put it toward your loans.
Tax refund? Put it toward your loans.
Make bi-weekly payments
Bilateral mortgage is a mortgage product that allows the borrower to pay every two weeks instead of once a month. Bilaterally, a mortgage means that the borrower pays every two weeks or 26 halves. The result is 13 full payments in 12 months, effectively accelerating the repayment of loans.
Pay off capitalized interest
Capital interest can be avoided by paying at least what new interest accrues. Pay interest at the end of the grace period or at the end of other delay periods before the interest on the graceful federal loans is added to the balance.
Donors that pay off student loans
The charity pays back to the students.
Rolling jubilee. Rotated jubilee works like a collection.
Credit counseling agencies.
Public Service Loan Forgiveness.
Federal Student Rescheduling Program.
State-Sponsored Annuity Payment Program.
Military Student Loan Forgiveness.
Student loan repayment methods
Federal Student Loan Repayment Options
- Standard Repayment Plan.
- Graduated Repayment Plan.
- Extended Repayment Plan.
- Pay As You Earn Repayment Plan (PAYE).
- Revised Pay As You Earn Repayment Plan (REPAYE).
- Income-Based Repayment Plan (IBR).
- Income-Contingent Repayment Plan (ICR).
- Income-Sensitive Repayment Plan.
Best way to pay off student loans while still in school
Try these strategies:
Pay interest. If your federal student loan is not subsidized, it charges interest immediately.
Give back Many people actually take more sorrow than the school needs.
Adjust the loan amount. …
Think strategically about repaying student loans.
How to pay off student loans faster calculator
How to pay off large student loan debt
Refinance your loans. Loan o Follow forgiveness. Sign up for an income-driven rescheduling plan. Use the Debt snowfall method.
- Refinance your loans
Arrow recipients with high monthly payments.
Borrowers with good tones.
Borrowers recipient with a creditable cozier.
Borrowers recipients, including large private students.
Pros and cons of paying off student loans early
The Pros and Cons of Paying Off Student Loans Early
|Pros of Paying Off Student Loans Early||Cons of Paying Off Student Loans Early|
|When you can save money by avoiding interest||When you haven’t built up an emergency fund|
|When you need to lower your debt-to-income ratio||When you’re fully utilizing your tax advantage|
How to pay off student loans in 5 years
This will reduce the amount of extra money you have each month to pay off your student loans for 5 years.
Refinance your loans.
Take advantage of auto-pay discounts.
Pay two per month.
To work carpool.
Share meals twice a week.
Order water at restaurants.
Share Netflix account.
Paying off student loans in full
The fastest way to pay students
Use a student loan repayment calculator to see how much each of these strategies can save you.
Pay off student loans as soon as possible – the smart way
- Pay off capitalized interest.
- Make extra payments.
- Make biweekly payments.
- Take advantage of your employer’s generosity.
- Refinance student loans.
Best Tips For Paying Off Student Loans Fast
I talked about the four reasons why you should forget your student loan forgiveness program, as well as the student loan forgiveness tax bomb that occurs. Another thing that I briefly talked about is the fact that if you stop paying your student loans, they have the legal right to garnish your tax return as well as your wages.
My process is going to show you how to optimize your student loans, how to optimize your cash flow, and literally pay your student loans off 10 times faster than just paying the minimum payments or waiting on student loan forgiveness. So let’s go ahead and get started. Step one is very basic, and yet very important. I need you to log in to your lender’s website.
Now, you may not know your login information, or this may be the first time that you’re logging in. And that’s okay. I want you to get comfortable logging in and taking a look at this information, but it’s very important that you don’t write your login credentials down. Do not write it down on a piece of paper.
Instead, use password management software like LastPass. LastPass helps you manage all of your passwords across all of your sites, and I’ve got a special link in the description below to help you open an account. Now that you’re logged in, I want you to make note of five things.
Number one is how much you owe.
Number two is what type of debt. Is it private, is it federal, subsidized, unsubsidized?
Number three is the APR. What is the interest rate on the debt, on each debt? I know some student debt has a bunch of loans kind of tied into one, and all the interest rates are different. Make note of that.
Number four is the principal versus interest on each individual payment. And number five is the length of the loan. All of that is included in step number one. Log in to your lender’s website, get familiar with your debt, and if you don’t already have one, get some sort of password management software like LastPass.
Number two is minimizing your interest. Throughout this whole process, the interest amount is going to be the biggest time and money waster. So we want to minimize it as much as we can in the beginning. Here’s how it works. Interest and principal are both going to be in every single payment that you make to the lender. The principal amount is going to go toward the total balance, while the interest goes to the lender for borrowing the money, to begin with. As you make your payments, you’ll notice that the interest amount starts to get slightly smaller, while the principal amount grows.
At the beginning of our mortgage, our interest was actually the majority of our payment, while our principal was only around $200. Now, our principal each month is actually more than our interest, and it works the same way with your student loan. This is why it’s so important to hit your student loan hard in the beginning when the principal is very small and the interest is big.
The more principle you pile on, the faster that interest will start to shrink. Before you know it, your principal will be more than your interest each month. That’s when you really start to see the progress. So while you are logged in, go ahead and take a look at your APR. The average interest rate for student debt is 5.8%. If your interest rate is at, I would say about 8% or higher, you need to call your lender and ask them why it’s so high and what you can do to lower it. The reason might be that when you applied for the loan and got approved, your credit score was very low. For tips on how to raise your credit score, check out my video here.
Step three is to increase your monthly cash flow. So, I’m assuming that your student debt is probably the largest amount of debt that you have. Take a look at if you have any other car loans or credit card debt. By paying these off and leaving the accounts open on your credit cards, can actually help free up a lot of cash. Is there a car loan that you’ve just got a couple thousand left, that you can hurry and pay off so that you can free up $300-400 a month? Free up as much cash flow as you can by paying these smaller debts off, so that we can really attack the big student loan.
So at this point, the interest rate on your student loan is average or lower, or you’re working on your credit score so that you can refinance to a lower interest rate. On the other hand, you’ve freed up a lot of cash flow, because you’ve paid off your car and your credit cards that were holding you back and eating up that monthly cash flow. So now, step four is all about optimizing your monthly payment. We don’t wanna use things like forbearance, where interest still accrues on your student loans, and we don’t wanna use deferment, because it extends the life of the loan, and interest may accrue. But something that may help you temporarily is income-based repayment.
Now, you do have to apply and qualify for income-based repayment plans, but this can significantly help lower your monthly payment while you put extra toward the principal. Really important to note that you have to specify that you want the extra amount going toward the principal. The default at times can be to go to the next payment, which we don’t want at all. You’re just paying more interest ahead of time. We want the extra amount to go only toward the principal balance. But remember, income-based repayment only helps you if you put extra toward the principal. If you’re just making these tiny, tiny payments, your loan actually might grow. The interest might be so much more than the principal, that you’re actually digging yourself a deeper hole.
You absolutely have to put a significant amount of extra toward the principal each month. If income-based repayment doesn’t work for you, if you don’t qualify, or you don’t want to have to qualify time and time again, there is another option for you. And that option is extending the life of the loan. Now, hear me out, this sounds really weird. Why would I take my 10-year student loan and extend it to 20 or 25 years? But here’s why, and again, you have to follow the process. If you extend the life of your loan, the amount that you’re paying is actually going to go down, freeing up more cash for you to put toward the principal.
So let’s say you’ve got a loan at 10 years, and your monthly payment is $500. If you extend the loan to 20 years, your monthly payment is now $250, but you’ve got an extra $250, or $350, or $400 that you can put specifically toward the principal. By extending the life of the loan, we’re actually lessening the minimum payment, which is lessening the interest that we pay each month, freeing up more money than we can put toward the principal.
Now that our payments are optimized, we wanna move on to step five, which is decreasing expenses. So remember, we’ve optimized our payments, we’ve minimized that interest as far as we possibly can, and now, let’s cut back on frivolous and unnecessary expenses, so that we can pile on the cash toward the principal, and pay this off in one or two years.
Take a look at your online banking, and see if there are any small leaks that you can plug up, like subscriptions, groceries, eating out entertainment, or travel. These are a great way to just cut expenses temporarily, while you pile on the cash and get that student loan balance down. Another great way to cut expenses like your phone bill, internet bill, and rent, is negotiating, and I go full depth in this video here.
Plus, I’ll link it down in the description below. Step six is all about increasing your income. Now that we’ve decreased our expenses, it’s important to use our time wisely through working overtime, working side hustles, and possibly asking for a raise. If you have the opportunity to work overtime at your job, this is probably going to be the best ROI for you, return on investment.
On the other hand, if you’re coming up for a yearly review with your boss, go ahead and start the discussion of what it would look like for you to receive more responsibility and more compensation. And if those are off the table, you can make several hundred dollars a week by doing side hustles. If you want me to do a separate video on side hustles, definitely let me know below that you would find that valuable. All right, so let me go ahead and summarize what I’ve talked about so far.
Number one is logging in to your lender’s website. Get familiar with your debt.
Number two, get your interest down, whether that be refinancing or getting your credit score higher.
Number three is freeing up cash flow, by paying off your car and other credit cards. Get as much debt out of your life as possible, so you’ve got a lot of money to pile on to the principal.
Number four is optimizing your payment.
Number five is decreasing your expenses.
Number six, increasing your income. And number seven is calculating your debt-free date while tracking your progress. Once you get into a flow, it’s very easy to become discouraged and for everything to feel very monotonous. I highly recommend calculating your debt-free date, and that’ll give you something to look forward to. In addition, track your payments, and make sure that you can visually see the progress that you’re making. I promise, that will help so much with motivation. I know it can feel like a long road, but I promise there is so much freedom on the other side of those payments, and it’s worth it.