If you have ever had a student loan, you probably understand how it can become an albatross around your neck if you let it. Yet, if you follow smart student loan strategies you can pay off your loan more quickly. It takes the average person 20 years to pay off a student loan. Depending on the amount owed and your income, you may be able to reduce that by half if you are diligent.
Just like with credit card debt, you need to pay more than the minimum payment each month. If finances allow, schedule a second payment later in the month even if the amount is smaller. The more payments you make the more quickly you will pay off student loan. Lowering your interest rate will help too. Most student loan companies offer reduced interest rates if you schedule your payments with autopay. Your goal is to put as much money as you can towards the principal each month.
Another way to reduce the interest on your loan is to refinance. Check with your bank to see what kind of interest rate they will offer. Renegotiate your rate with your current lender. And don’t forget to negotiate the fees. Federal student loans have limited fees while private loans do not.
You can also ask a family member with a high credit score to co-sign to help lower the interest that you pay. In the meantime, think of ways to improve your credit score. On-time payments help establish great credit but so does having high credit limits while only utilizing a small percentage of your credit. Once you understand smart student loan strategies and how to make them work for you, that monthly payment won’t seem as daunting.