How to Pay Off Your Student Loans Quickly: 7 Crazy-Ass Tips that Work
Finally, you’ve decided to pay back the so-called student loans. It’s a decision that, though it isn’t fun at all, you have no other alternative, but to make. And there’s nothing funny about it at all!
At a time when almost everyone seemingly hasn’t paid this debt, and it’s already hitting an all-time high of $1.5 trillion, your decision is definitely laudable. But even though you have decided to stop the shame of student loan defaulters from following you, there’s one other thing you certainly need to address as well.
You need the loan cleared ASAP and the responsibility put to rest forever. But you have no idea how you’ll get that done. Of course, the idea of repaying it for 20 years is out of the equation.
So, what’s the plan?
The plan is to get the right repayment strategy, stick by it, and get the entire chunk remitted quickly. If you wouldn’t mind, then here are some crazy-ass student loan repayment hacks that work.
Let’s check them out!
Here’s how to pay off your student loans quickly
You need to live the life of a ‘pauper’
Not a pauper really, but rather a frugal lifestyle. Having graduated and landed a ‘not-so-well-paying- job, don’t give up your hopes of getting the loan repaid. Don’t even see the whole mountain as though it isn’t scalable!
I want you to pause making massive investments for a year or two, and instead focus on getting the loan repaid. YES, live the poor student lifestyle and ask your parents and friends to offer a hand when things get tough. But don’t deviate from your innate goal of getting the whole figure paid off as soon as possible.
The best way to live this lifestyle is to find a roommate whom you’ll stay with. If you are Ok with a silent, not-so-fancy life, then live it. Also, remember that it would be great if you start repaying the loan as soon as you get your first pay.
Trim your everyday spending
If your day-to-day expenses are high, work on a way of reducing them. Don’t fear to extremely trim it, so long as you are comfortable with it. Some of the costs to eliminate include ditching KFC or McDonald’s, moving to a cheaper apartment, skipping happy hours and living on a budget.
If you execute this strategy well, trust me, you will need less than two years to get the whole nightmare off your mind forever. So, don’t feel guilty about canceling cable TV, not going out with friends anymore and giving up fancy clothes.
Ideally, there’s no secret formula to be followed when trimming your spending as everything depends upon your creativity, motivation, and perseverance. If you are Ok with whatever you stopped spending on, then so be it!
Boost your average monthly repayments with a side hustle
Besides keeping your average monthly expenditures low, you could ensure the amount remitted increases by taking up an extra job. There are over a hundred side hustles, and some even require no unique expertise, but pay a lot.
You may venture online and be an academic tutor, work as a freelance copywriter, or do anything sure to bring you a few more bucks on the side. You could even serve as an Uber or Lyft driver, sign up with PostMates and deliver parcels when you are out of work or serve as an Overnight Attendant at a local motel for a pay.
The best thing with taking up a side job is the extra pay you will be sure of when your primary income is going straight for the repayment program. You will feel happy that the whole burden is getting reduced pretty quickly. This strategy will also earn you an additional skill and keep you away from feeling sorrowful that your lifestyle isn’t the same as that of your peers.
Ask for cheaper interest rates in exchange with your swift repayment
If you are planning to get the loan repaid ASAP on one go, don’t fear to walk up to their offices and ask for a discount. These guys mostly offer a lucrative offer in such instances, perhaps as an incentive for the noble gesture.
But even if you choose to repay the entire amount in less than a year, don’t fear to ask for a deduction. They often offer a 0.25% interest rate deduction to anyone enrolling in automatic payments. You would be surprised by how much you will save!
It makes a lot of sense to focus on lowering your remaining loan amount. But even when the idea of refinancing it is recommended, only do it with your mind open. Simply put, avoid any suspicious income-driven loan repayment program.
See, nearly all these loan repayment programs only lengthen the term of the loan. They offer no financial help and will only shroud your eyes with the extended repayment period.
The idea of refinancing isn’t bad, provided it saves you money. One thing to always keep in mind if you choose to go down this route, however, is to avoid losing out on federally-funded perks. Don’t opt for private lenders may not have your interests at heart!
Can you pay it every two weeks?
A bi-weekly loan repayment plan is no joke, but it certainly will be worth it if you need the entire amount paid off quickly. It is a trick which, if combined with a strategy known as the “debt avalanche” method, will get the pressing burden reduced quickly. The bottom line here is to ensure that you reduce the principal on the student loans at a much faster pace.
Direct your cash windfall to this cause
It doesn’t matter where you got it from, just close your eyes for a second and let it settle a significant portion of it. A cash windfall, whether you won a lottery, your grandpa shared with you proceeds of his pension, or anything could massively lessen the financial burden on your back.
It is tempting not to use your windfall to repay the loan you can’t account for in the first place. But because this is the decision you chose to stick to, don’t feel guilty about it. Instead, find solace from the fact that soon, you will be free and happy to use your money the way you’d like. Remember, the goal here is to repay the loan as quickly as possible.
The snowball method of paying off debts works well with student loans. You just have to make a list of how you intend to get the amount repaid and the size of your periodic payments. Also, paying more than the minimum acceptable amount, every time you remit the payments, will hasten your pace and effectively get you closer to repaying the while money faster.
Lastly, don’t forget to automate the remittances. This way, you will have no excuse for missing out on repayments or missing the deadlines. And, trust me; you will get the whole nightmare off your head quickly!