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8 Tips for Paying Off Student Loans as Quickly as Possible

June 29, 2021

There’s no other way to put it: student loans suck, and it sucks that higher education is so expensive to begin with. Everyone has that relative or neighbor who says, “Back in my day, I could afford to pay for college with only a part-time job!” Yeah, if only they knew.

You don’t want to be burdened with debt for decades after you graduate. Not everyone will be in a financial position to leverage some of these student loan repayment tips, but they’re important bases to cover, and you could save yourself some money in the long run.

Let’s discuss how to pay off student loans as quickly as possible:

1) How to Pay Off Student Loans: Prepay — But Wisely

When you think of ways to repay debt quickly, your immediate thought is probably, “Well, I’ll pay more than I owe each month.” This technique works if it’s feasible for you (lenders aren’t allowed to charge prepayment penalties for student loans), but there is something to be aware of: you have to make sure your lender knows that’s what you want.

Say your monthly bill is the national average of $393. You have a decent-paying job and can afford to make a payment of $500, hoping to get a head start. It’s imperative to call your loan servicer and tell them that you want this $500 to go toward your loan principal; otherwise, they might apply it toward your next monthly bill (reducing it to $286), which doesn’t actually put you ahead.

2) Start Payments as Soon as You Can

Another way to get ahead is to get a head start. If you can, don’t wait until after you graduate to start paying off your debt. You don’t have to pay your loan servicer just yet, but put away whatever you can afford into a student loan repayment account, so you have a few hundred or thousand dollars to put toward your principal once your bills start coming in. Part-time jobs associated with your campus might be more accommodating of your busy class and homework schedule.

3) Set a Schedule and a Budget

Make life easier for yourself and establish two things: a schedule and a budget. Your bills will arrive monthly, so you can set up your account on autopay, but you might want to consider paying twice a month instead of once. This way, you can pay off more of your principal and budget accordingly with your other monthly expenses better.

Your budget likely depends on when your income and bill arrive. If the former doesn’t come in time for you to pay your bill or establish the budget you’d like, you can use Earnin to access your paycheck for hours already worked. Determining how much you want to pay every month (if it’s more than what your bill states) also helps you account for other costs and reduces the likelihood you’ll miss a payment or fall behind.

4) Remember Your Tax Deductions

Here’s a neat student loan tip: did you know that you can deduct as much as $2,500 from your annual taxes for any interest you pay? How much you can deduct depends on your situation, but you can claim this deduction even if you don’t itemize your taxes, and it applies to both federal and private student loans. Saving this money on your taxes frees up some extra cash for paying your loan principal.

5) Refinance Your Loan

It’s also possible to refinance your student loan. Refinancing means switching out your loan for one with more favorable terms, just like refinancing a home mortgage or a vehicle. In the case of student loans, you might have to forfeit some benefits if you borrowed from a federal source. Still, it’s an opportunity to negotiate a lower interest rate and a shorter repayment period. People’s credit scores are often pretty low when they graduate college, which contributes to their student loan interest rates, so consider refinancing if you now have a better score and want to pay off your balance faster.

6) Check Out Loan Forgiveness Programs

What if part of your loan could be… forgiven? You’d have a smaller balance and could pay off your student loans much more quickly than before. Check out various student loan forgiveness programs, such as Public Service Loan Forgiveness and Teacher Loan Forgiveness, to see if you qualify. These programs can be selective, and you’ll have to meet specific requirements (and agree to certain terms), but they’re worth looking into.

7) Check for Discounts

Many lenders will offer you a small discount — such as 0.25% — if you set up automatic payments. If you borrowed from a private lender, contact them and ask about any other discounts or reductions they offer. Such discounts are small, so don’t get your hopes up about a significant change, but any amount helps.

8) Avoid Repayment Programs

Student loan repayment programs can be helpful for people struggling with paying off their debt. They’re not inherently bad and can help you lower your monthly installments, but if you want to pay back your debt quickly, then it makes sense to avoid them. However, some employers offer student loan repayment assistance, which are programs you should consider if they’re available.

Student loans can be cumbersome, but there are ways to relieve yourself of them sooner than later. Which of the above student loan tips will you use to pay off your debt as quickly as possible?


Photo by Vasily Koloda on Unsplash

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4Disclaimer: Up to 2 days early is based on comparison with traditional banks. Exact timing is dependent on your employer's payroll policies. For more information on eligibility and requirements of Earnin Express, visit earnin.com/TOS.

5Source: Internal analysis conducted by Earnin on December 10, 2020.

1Restrictions on use of Services and/or third party fees may apply, see earnin.com/ privacyandterms for details.

2Balance Shield cash out is subject to your available earnings and daily pay period max. Other restrictions and/or third party fees may apply. For more information visit earnin.com/privacyandterms.

3Tip Yourself Account funds are held with Evolve Bank & Trust, Member FDIC and FDIC insured up to $250,000. Tip Yourself is a 0% APY and $0 monthly fee service. Other restrictions and/or third party fees may apply, see earnin.com/privacyandterms for details.

1Lightning Speed may not be available to all Community Members. Cash Outs may take up to thirty minutes, actual transfer speeds will depend on your bank connection. Restrictions and/or third party fees may apply, see earnin.com/TOS for details.

2Restrictions and/or third party fees may apply, see earnin.com/TOS for details.

3Balance Shield cash out is subject to your available earnings and your daily pay period max. Other restrictions and/or third party fees may apply, see earnin.com/TOS for details.

4NO PURCHASE NECESSARY TO ENTER OR WIN. Must be 18 years of age or older and a legal resident of the U.S. or DC. Games begin each Sunday starting 12/6/20 at 9:01 p.m. ET and end the following Monday at 9:00 p.m. ET with the last Game ending 12/19/21. To download the App, view the Official Rules, odds disclosures, prize details, and alternate means of entry, visit WeWin Game & Sweepstakes Official Rules. Void where prohibited. $10,000,000 grand prize payable over 29 years. Sponsor: Activehours, Inc. (d/b/a Earnin), 200 Portage Ave, Palo Alto, CA 94306.

5Tip Yourself Account funds are held with Evolve Bank & Trust, Member FDIC and FDIC insured up to $250,000. Tip Yourself is a 0% Annual Percentage Yield and $0 monthly fee service. Your Tip Yourself Account and any Tip Jars are not Savings Accounts. For more information/details visit earnin.com/tos.

6Up to two days early is based on comparison with traditional banks. Exact timing is dependent on your employer’s payroll policies. For more information on eligibility and requirements of Earnin Express, visit earnin.com/tos.

7Your Max on Earnin Express is up to 80% of your payroll or $1000, whichever is less. The 80% is dependent on you routing your full paycheck to Earnin Express. For more information on eligibility and requirements of Earnin Express, visit earnin.com/TOS.

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1Disclaimer: Restrictions and/or third party fees may apply, see earnin.com/tos for more details. Lightning Speed may not be available to all Community Members. Cash Outs may take up to thirty minutes, actual transfer speeds will depend on your bank connection.

2Disclaimer: Lightning Speed may not be available to all Community Members. Cash Outs may take up to thirty minutes, actual transfer speeds will depend on your bank connection. Restrictions and/or third party fees may apply, see earnin.com/TOS for details

3Disclaimer: Community Member must have had at least 1 successful debit with Earnin. Limit to 1 Max Boost per pay period. A boost will not adjust a Community member's daily max. Restrictions may apply, see earnin.com/tos for more details

*Disclaimer: Balance Shield Cash Out is subject to your available earnings and daily pay period max.Other restrictions and/or thirdparty fees may apply. For more information visit earnin.com/tos

1Restrictions may apply, see earnin.com/tos for more details. Tip Yourself Account funds are held with Evolve Bank & Trust, member FDIC and FDIC insured up to $250,000. Tip Yourself is a 0% Annual Percentage Yield and $0 monthly fee service. Your Tip Yourself Account and any Tip Jars are not Savings Accounts. For more information/details visit earnin.com/tos

2Disclaimer: NO PURCHASE NECESSARY TO ENTER OR WIN. Must be 18 years of age or older and a legal resident of the U.S. or DC. Games begin each Sunday starting 12/6/20 at 9:01 p.m. ET and end the following Monday at 9:00 p.m. ET with the last Game ending 12/19/21. To download the App, view the Official Rules, odds disclosures, prize details, and alternate means of entry, visit https://www.earnin.com/wewin/game-rules/. Void where prohibited. $10,000,000 grand prize payable over 29 years. Sponsor: Activehours, Inc. (d/b/a Earnin), 200 Portage Ave, Palo Alto, CA 94306.

3Disclaimer: Restrictions Apply. See earnin.com/wewin/pool-rules/ for more information

*Disclaimer: Up to 2 days early is based on comparison with traditional banks. Exact timing is dependent on your employer's payroll policies. For more information on eligibility and requirements of Earnin Express, visit earnin.com/TOS.

**Disclaimer: Restrictions and/or third party fees may apply, see earnin.com/tos for more details. Lightning Speed may not be available to all Community Members. Cash Outs may take up to thirty minutes, actual transfer speeds will depend on your bank connection.

*Survey conducted in February 2020 with 889 participants.

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