• For instance, you might refinance a 10-year student loan to a term of seven years. It would result in higher monthly payments, but you’d pay the loan off faster and save money on interest. And if you can refinance to a lower interest rate as well, more of your money will go toward paying down the balance as fast as possible.
• Before I answer your question as a tax expert, let me quote some of the other experts here at Debt.com when I told them you planned to pay down your student loans by gambling on sports. “It shouldn’t need to be said, but gambling isn’t the same thing as saving or even investing,” warns Debt.com chairman Howard Dvorkin.
• Student loan debt affects a majority of college graduates today – about 65% of class of 2018 graduates took out loans to pay for college, according to U.S.

Learn More About Paying Off Your Student Loans

The fastest way to pay off student loans includes paying interest while in school, using autopay and making payments biweekly. Make extra payments to principal when you can. Consider refinancing.

• Overcoming the Student Loan Crisis

  Let’s be real, y’all. The student loan crisis in this country has become way too serious to ignore. Right now, the total amount of student loan debt in the U.S. is coming in at over $1.6 trillion.(1) That’s insane.

• How to Pay Off Student Loans Fast

  Do you dream about paying off your student loans fast? So does pretty much everyone in America. Whether you’ll be graduating from college soon or you’ve been trying to kick those student loans to the curb for a decade, you can make a plan for paying off student loans quickly.

• How Do Student Loans Work?

  Here’s the thing about student loans: Not enough students understand how they really work or the effect they can have on future goals and plans. When you’re about to graduate from high school, it can feel like everyone wants you to continue your education, but nobody can tell you the best way to pay for it.

• Should I Apply for Student Loan Forgiveness?

  Back in the day, when you were trying to figure out life after high school, you might’ve believed the lie that loans were the only way to pay for college. And now that you’re a college graduate staring at a mountain of debt, you probably wish you would’ve explored other options.

The student loan crisis has reached a fever pitch. It’s become a national epidemic, one that reached $1.5 trillion in 2018.

Paying off student loans is a rite of passage for twenty-somethings, one that often begins just a few months after college graduation.

But for some students, making payments in college is possible. Even if you think you can’t contribute much, making payments before you graduate can reduce your total interest and decrease your overall loan burden.

Paying off student loans in college isn’t as difficult as passing Econ or finding out why your ex ghosted you. Read below to find out how to start the process.

Find Your Loans

To start paying off your loans early, you need to find out where your loans are. A servicer may transfer or sell your loan to another provider, making it hard to find out where your loan is. Some of the most popular services are Nelnet and Navient.

Visit the National Student Loan Data System website and type in your Federal Student Aid ID, a personal login to view your student loan information. This is only applicable for federal student loans.

You can find your private loans by checking your credit report at AnnualCreditReport.com. That will show credit reports from all three credit bureaus, Experian, Equifax and TransUnion. Your credit report will reflect if you’ve taken out a private loan in your name.

Ask your parents if they took out student loans on your behalf. Even if your parents paid for your tuition with this loan, it won’t show up on your credit report because your name isn’t on there.

Best Way To Pay Off Student Loans

Pick Which Loan to Pay

If you’re like most college students, you probably have multiple student loans, at least one a year for each year of school. Each loan will have its own principal and interest rate, which may vary. Create a basic spreadsheet or list of all your loans, and include the total amount borrowed, the interest rate, and where the loan is subsidized or unsubsidized.

A subsidized loan doesn’t accrue interest while you’re in school. If you have a $5,000 subsidized loan, it will still have a $5,000 balance when you graduate. An unsubsidized loan does accrue interest while you’re in school. These loans should be your top priority.

If you don’t pay off the accrued interest before graduation, the interest will be capitalized and added to your principal. This raises your overall principal amount and will cost you more interest overall.

Choose a Repayment Strategy

To save the most on interest, pick the loan with the highest interest rate. If you have a loan with 4% interest and one with 13% interest, choose the loan with 13% interest. This is also known as the avalanche method.

You can also pick the snowball repayment method which says you should repay the loan with the smallest balance first. If you have a $10,000 loan and a $5,000 loan, this method would have you repay the latter one first. This is because getting rid of individual loans is motivating, especially if you have a high overall burden.

There’s no right or wrong answer when it comes to picking a repayment strategy. Each method has its pros and cons, which depend on your personality and debt tolerance.

Decide How Much to Pay

Making payments while you’re in college will reduce your interest load and save you money. But it’s easy to get overzealous and pay too much toward your student loans.

Don’t forget to save money in an emergency or rainy day fund. This amount will pay for the essentials if you have a car accident, can’t find a post-grad job or visit the ER. Having $1,000 or more in a savings account will prevent you from taking out a high-interest loan or having to sell plasma.

This is especially important if you don’t have a backup plan like borrowing money from your parents or friends. Being a self-sufficient adult is all about being able to take care of emergencies yourself.

Balance paying off your student loan early and saving an emergency fund. Remember, you can always put more money toward your loans if you have extra savings, but you can’t get the money back from your student loans if you have an emergency.

You should also make sure you’re not carrying any other debt, like a credit card balance or auto loans. Student loan interest is tax-deductible and interest rates are often lower than other types of loans. If you have a $5,000 student loan with 6% interest and a $5,000 credit card balance at 22% interest, you should pay off the credit card loan first.

Plus, federal student loan providers have extended repayment plans if you’re struggling to make payments. These aren’t available with credit cards, personal loans or car loans.

Set Up Automatic Payments

The easiest way to make extra payments on your student loans is to set up automatic payments from your bank account. Visit the loan provider’s website and find the payment tab. There should be a place where you can establish automatic transfers every month.

If you go with automatic payments, make sure you always have enough in your bank account to cover those payments along with your other transactions. If your $50 student loan payment goes through while you only have $40 in your bank account, your payment will be rejected and you’ll have an overdraft fee on your account.

Automatic payments are only a good idea if you always have enough in the bank account. If your income or expenses vary widely, it’s better to do manual payments. To do a manual payment, pick a time every month to make a payment on your student loans.

Pay Off Student Loan Debt

It’s also good to make extra payments whenever you have a windfall, like a tax refund or birthday check from grandma. There’s no pressure to make extra payments on a set schedule. If you have the funds one month, great. If you need to get the brakes fixed on your car, skip the extra payment.