5 Tips For Student Loan Repayment
For many of us, student loan debt is the lingering price for a quality education. No one wants to use their hard-earned money on bills from the past. It may seem like there’s no end, but fortunately that are many options to speed up the repayment!
Pay More Than The Minimum
This is a simple way to reduce your debt. Set up automatic payments with your extra amount added in, which goes straight to the principal amount. Remember, something is better than nothing. If an extra $20/month is doable for you, it’s worth making the change.
Refinancing your loans is another method for paying off debt faster. By refinancing, you are decreasing the interest rate, which allows your payments to go towards the principal amount. If you have multiple student loans, you have the option of getting one consolidated loan with a monthly payment.
Don’t Forget Tax Deductions & Credits
By using the student loan interest deduction on your federal taxes, you may be eligible for a deduction up to $2,500 each year for the interest you have paid on loans. Most student loan holders in their 20s are eligible.
If you are currently paying tuition, you may be eligible for a tax credit. Tax credits are generally more valuable than tax deductions.
Got a Raise? Apply It.
It’s easy to get carried away once you get a raise at work. Most of us are inclined to splurge on material things. And that’s ok! However, if you learn to put a decent chunk of each annual raise towards student loan repayment, you will be free of your debt more quickly.
It’s best to add the extra amount to your automatic monthly payment, but you could also start a separate savings account strictly for your loans.
Pick Up a Side Gig
If paying off your student loan debt sooner than later is important to you, you may want to consider picking up a side job for the extra income.
The options are endless! Think about what interests you and the additional talents you have to offer. Applying your extra earnings directly to your student debt is a great way to get your balance down.