5 Ways to Pay Off Your Student Loan Debt
It’s difficult enough to transition from college life to the real world without having to worry about a crushing amount of student debt.
Yet right now there is a grand total of $1.3 billion dollars of student loan debt in the United States. The average college student graduated in 2016 owing $37,172.
For many, that large of a debt can seem too daunting to ever believe they’re ever going to be able to pay it off. Luckily, there’s something that can be done.
There are debt reduction services available. Here are five ways to pay off your student loan debt.
1. Make Larger Payments When You Can
While it’s usually difficult when you’re just starting out, one of the easiest ways to pay down your debt quickly is to make larger payments. Don’t just pay the bare minimum.
The bare minimum will keep you in debt much longer. Even paying as little as $30 or $40 extra per month can be a big help.
Whether you consult with a debt reduction services company or pay the student loan debt off by yourself, you should always pay as much as you can towards the principle each month.
Of course, you don’t have to just stick to paying an additional $40 each month. If you find yourself with some extra money, like $100 one month, definitely use that money to pay down your debt.
2. Create a Budget for Yourself
Most people with student debt are young. Which usually means going out and having fun after work.
But drinks, food, and entertainment can quickly add up. A debt reduction services company will help you figure out a budget that you can stick to.
If you’re doing it on your own, first figure out how much money you earn each month. Then list all the bills you have, including rent, credit card debt, food, and of course, your student loan debt.
A budget will help you make sure that you always have enough money to pay for necessary items like a roof over your head. You’ll also always know there’s enough money to pay down your debt.
While you may have to make some concessions, it’s better than paying down your debt for the next 20 years. Having a budget will also help you plan for the future when you want to buy a home or plan a vacation.
3. Reduce Non-Essential Items From Your Life
There are plenty of ways to save money. One of them is to reduce or eliminate all non-essential items from your life.
A debt reduction services company will take a look at all your current expenses. Then they’ll have you take a hard look at what it is you really need versus what you really want.
While cable tv is awesome, it’s not necessary. Especially with much less expensive services like Hulu, Amazon, and Netflix.
Maybe you eat out every meal. Learning to cook will not only help you save a lot of money, you’ll also start eating healthier.
And while those black boots or sneakers look amazing on you, since you already have 20 other pairs in your closet, you don’t actually need new ones.
While it may seem difficult at first to reduce these items, you’ll usually find you don’t miss them that much once they’re gone.
While you’re at it, don’t forget to allocate funds for fun. By doing that, you’ll have something to look forward to and it will be much easier to keep yourself on budget.
4. Live With Others
Having a roommate is one great way to reduce your debt. A debt reduction services company will always advise you to live with others as a way to save money.
Rent can often cost you one-half to one-third of your income, depending on where you live. By getting a roommate, you can save anywhere from 11% to 19% of your income.
Even if you currently live in a one bedroom apartment, you can make the living room a bedroom. While it may not be ideal, it’s not forever.
Another way to save a lot of money is by moving back in with your parents. Often, parents are willing to allow their children to live rent-free or with a drastically reduced rental rate.
If you do decide to move in with your parents, make up a contract beforehand. That way, you and your parents will already know what to expect.
This could include which expenses are being paid by you and at what amount. It can also mean having a plan about visitors and when they’re allowed over.
Included in your contract can also be a section discussing the right to privacy. This ensures that all parties remember that you’re all adults and should be treated as such.
5. A Debt Reduction Services Company Can Help You Switch to an Income-Driven Repayment Plan
Unfortunately, salaries have not risen much in the last few years. Part of that is due to current labor conditions.
The recession forced many people out of work. It took them awhile to find a new job. Normally, when a company hires someone new, they pay them accordingly.
However, because many of these people were unemployed for a long time, they’re just grateful to have any job at all. Companies hiring know this and have kept hiring salaries low.
Meanwhile, wage growth in all industries has not grown considerably in the past years. Yet rents have risen considerably.
All this means that often you’re not earning enough money to pay your expenses. Having a student loan payment ends up stretching your budget too thin.
If that’s the case, consulting with a debt reduction services company can help. They can help you find a new repayment plan that’s based on your salary.
An income-driven repayment plan ensures you’ll earn enough to pay your rent and your student loan.
Consult with a Professional
Most schools don’t teach students how to deal with debt. They also rarely teach students how to refinance a loan.
That often leaves students feeling scared and alone with mounting debt staring them in the face. A debt reduction services company can help.
Contact us today. We’ll work with you to help you formulate a working plan to reduce your debt as quickly as possible.