Getting a career and landing your dream job is no walk in the park. Because competition in the workplace is becoming even stiffer by the day, you have to find a way to be a cut above the rest—and obtaining a degree is one of the best ways for you to achieve this.
Despite all the benefits that you can gain from going to college, there are still many who, unfortunately, choose not to. The costs can be quite high, and it isn’t the most affordable option for some. Imagine having to pay an average of over $10,230 per year in tuition. That’s a lot of money! The good news is that universities are now making education more accessible for most, with the many college loans that they offer. You can even start paying off these student loans either while you are in school or when you have already graduated.
That said, here are some of the best tips you can follow in paying off your student loans fast:
1. Start Paying Your Loan During The Grace Period
One of the common mistakes committed by fresh graduates is that they enjoy the post-graduation period too much. Usually, loan companies give you a grace period of six months right after graduation, whereby you still aren’t obliged to pay for your debt. This grace period is intended for you to have enough time to look for a job before you are required to start paying off your loan.
During this grace period, there are those who jumpstart into a career right after college. There are even some students who start working a few days before graduation. If you are one of these students, it is best for you to start paying off your debt even during this six-month grace period. Make payments even when you aren’t required to yet. In essence, this is like making advance payments into your loan. Plus, another advantage is that you have already started shouldering this responsibility early on, which makes it easier for you to regularly attend to your financial obligations since you’ve turned it into a habit.
2. Study The Different Payment Options
Not all loans have the same payment options. Other payment options may be better on your budget and your pocket than others. Whatever your choice, it all boils down to a matter of personal preference. If you are a fresh graduate seeking to pay off your loan fast, it is best that you choose the payment scheme that allows you to auto-debit the amount of your loan from your salary every month. In this manner, you are more assured that you aren’t going to miss out on a payment. Another advantage of opting for this payment method is that you can avoid late fees and penalties. Because you are paying on time, you do not have any surcharge for late payments because you had either forgotten it is your due date, or you haven’t set aside money for your payment yet.
As you choose a payment option, keep in mind to select a payment schedule that is also friendly to your pocket. For instance, you can talk to your loan provider about the amount that you can best afford as of the moment. Later on, should you have a little bit more income, perhaps you can add on an amount that will make your loan payment diminish faster as well.
3. Create A Budget Around Your Loan
As you start earning your first income after graduation, you might get tempted to spend your salary like a one-day millionaire immediately. While it’s good that you’re taking steps towards financial independence by being able to provide for some of your needs without asking your parents, you should still remember to pay off your loan instead of spending your salary for frivolous things. Hence, the best tip you can remember is to work your budget around your loan and manage your finances. Before you allocate any other expense, be sure that you have factored in your monthly loan payments first. You can adjust everything else accordingly depending on how much you have left.
4. Try To Pay More Than The Amount You Have Set
Another very effective trick for paying your loans faster is for you to pay more than the amount that you have initially set. For instance, you may have set a payment of 250 dollars every month. But, in reality, you can pay around 50 dollars more. By all means, go ahead and pay the extra 50 dollars you can spend. There is no need for you to stick to 250 when you can give a little bit more. In that whole year, that’s 600 dollars worth of extra payments towards your loan, and you saved yourself from spending it on something else you might not actually need. Doing this technique can cut down your loan payments fast.
5. Do Not Try To Change Your Lifestyle Too Much
In college, you may have to adjust your lifestyle a bit. You might choose to simply cook in or get cheap takeaways, go to thrift shops or second-hand stores for furniture or clothing—you know the drill. Now, just because you have a stable job doesn’t mean that you have to make a 180-degree change of lifestyle. Try to live your college lifestyle again, at least until such time when you already begin earning more, and your student loans have been paid for.
For instance:
- If you have a best friend you can share an apartment with, then why not still have a roommate? That cuts down the rent, electricity and utility bills.
- Still continue eating at home when you can; it’s healthier, too.
- Don’t be afraid to score discounts or deals when shopping.
- Skip the expensive club fees when you can have house parties instead.
Conclusion
Dealing with student loans can be quite tough. Because of the increasing clamor to obtain an education, the number of student loans across the United States and even in other countries have significantly increased. Before you can reach your dream job or have a stable career, you will still have to pass through a staggering amount of student loans. Albeit difficult on the pocket, remember that once you start reaping the benefits of the effort you have sowed, all these student debts that you have obtained will all be worth it.
