Paying back your student loans can be a daunting task. Thinking about all of the money and interest you’re racking up can become overwhelming. Here are 5 ways you can save money on student loan debt.
1. Sign Up for Autopay
Having money automatically deducted from your account can sound like a disaster waiting to happen, but with your student loans, it can actually help. When you sign up for automatic payment with your student loan provider, you’ll typically be eligible for a discount on your interest rate. You also won’t have to risk paying late fees because your payment will automatically be on time each month.
2. Pay More Than the Minimum Payment
This may sound absurd … paying more than required to save money, but it’s a great tactic for your student loan debt. Here’s why: You’ll decrease the interest on your loans. We all know that interest is what keeps loans so expensive. By paying more than your minimum loan balance, you’ll pay less interest each month, and you may be able to pay off your loans faster than you expect.
3. Find Forgiveness Programs for Your Loans
Student loan forgiveness programs are ideal for saving money. While most forgiveness plans don’t begin until about 20-25 years after your loan status, there are some out there that will begin sooner. Various programs based on your profession. There are organizations focusing on teachers, doctors, lawyers, and even nonprofits, that will forgive your loans or help you pay them. Look for the options available and find a program that works for you.
4. Refinance Your Student Loan Debt
If some time has passed and your credit score and income have increased, you might be eligible to refinance your student loan payments. By refinancing, you can begin saving money, especially if you’re dealing with high interest rates. You’ll inevitably save more money with decreased interest rates, who doesn’t love that? Try using a refinance calculator to see how much you might save.
5. Pay on Your Loans During the Grace Period
A grace period is supposed to be a smooth six months of nonpayment on your student loan debt. However, if you want to save money, take advantage of this time period. If you have subsidized loans, the government will actually take care of your interest for you. If you begin to pay immediately, you’ll avoid racking up thousands of dollars in interest rates.
Find an Option that Works for You
There are other alternatives to combatting student loan debt. While you’re essentially paying money, you’re helping yourself in the long run. The interest rate on your loans can get aggressive and slow down the progress you’re making towards your loans. Look into the options and see what would work best for you and you may be able to pay off your student loan debt faster than you thought.
How do you save money on your student loans? Let us know in the comments below.