Americans owed more than $1.3 trillion in student loans at the end of June 2017, more than two and a half times what they owed a decade earlier (Pew Research Center, 2017). That number can sound scary and intimidating, just like the thought of actually trying to repay your own student loans. But don't let tackling your student loan debt be an overwhelming process. Use our suggestions to help guide your repayment journey.
Research Repayment Plans
Not everyone's repayment situation is the same, which is why there are many repayment options for borrowers. For example, a Standard Repayment Plan features fixed payment amounts that ensures your loans are paid off within 10 years. Another option is an Income-Based Repayment Plan, which recalculates payments each year based on your updated income and family size. Check out a full overview of repayment plans.
Make Extra Payments
Do you get an annual bonus at your current job? Or maybe you get a raise every year. How about a tax refund. Use all of the extra money that you have been living without anyways, and put it towards your student loan payment. This tactic will help you payoff quicker!
Increase Your Income
One easy way to devote more dollars towards tackling your student loans is to increase your revenue stream. This can be done several ways. First, you may consider asking for a raise at your current job. Another idea is to find side hustle jobs, such as pet sitting, freelancing, or tutoring. Whatever your skills, consider putting them to use on the side. Finally, look into getting an additional part-time job. This can be done on nights and weekends. Plus, many retailers look for seasonal help to compensate for their busier times.
Federal student loans offer the ability to qualify for loan forgiveness, under special circumstances. This means that the borrower is no longer required to repay some or the entire loan. Here are some of the most common types of loan forgiveness:
- Teacher Loan Forgiveness
- Public Service Loan Forgiveness
- Closed School Discharge
You can learn more and find out if you qualify for this program by visiting the Federal Student Aid website.