11 Feb Student Loan Debt: How To Pay It Off Faster
As of 2018, there are 45 million Americans that owe the astronomical amount of $1.56 trillion in student loan debt. And if that wasn’t scary enough, know that this is around $521 billion more than the overall credit debt of U.S. While student loans aren’t new, they became part of a bigger economic crisis, that affects the financial future of millennials. The situation is out of control and the low income makes it even harder to pay off. But at the same time, there are few actions you can take in order to pay off your student loan debt faster. Ready, set, scroll!
Consolidate Your Debts
The first step you need to take in order to pay off your student loan debt earlier, is to consolidate your payments. That means, that you can combine together all your debts from different banks, and set up a single monthly payment for all. By doing so, you are eligible for student loan forgiveness programs, while you can reduce your monthly payments. Some will argue that this is a bad tactic as it extends the life of your student loan debt. It may be true, but it can be life-saving if your first job doesn’t pay what you expected.
Set Up a Budget and Stick to it
It’s hard being young and broke, we all have experience on this. A payment plan along with a pretty tight budget, can help you to get out of the student loan debt faster. As much as you want to get rid of it as fast quick as possible, remember to set up a realistic budget. It should allow you to live, make payments, and then, if you’re making enough, to also save some. This is the only way to survive.
Apply for an Income-Based Repayment Program
You may feel overwhelmed and alone in this path, but hey, you’re certainly not! There are several ways to help you along the way with your student loan debt. One of them is of course to apply for an income-based repayment of your student loan. It’s ideal if you’re struggling with the monthly payments, as it will reduce them according to your household’s income. You’ll have to apply every year, and possible income increasements increase your monthly payments as well.
Try to Make Extra Money
Like you haven’t thought of it already, or it’s something easy! Of course you did, and of course it’s hard, but it’s also possible and very helpful. A part-time job it can be life-saving when you’re trying to pay off your student loan debt.
In every case you have to remember to stay calm, and to always find ways to do things better. It’s important to be organized and responsible with your payments etc., but it’s also crucial to keep your smile. Take it easy!