Graduating from college should be an exciting experience. However, the reality is that graduating from college can be scary. With the costs of higher education on the rise, many college graduates find themselves starting off their lives in debt. Trying to figure out how to get out of debt while starting a career can be overwhelming. Fortunately, if you find yourself in this situation, there are six effective tips to quickly reduce your student loan debt.
Make an Appointment with a Financial Aid Adviser: As soon as you graduate, make an appointment to speak with one of your college or university’s financial aid advisers to make sure you understand exactly how much you owe on your student loans. Make sure you make a list of all of the lenders you owe, how long you have to pay off each loan, and what the interest rate is on each loan. Ask your financial aid adviser for advice regarding your specific situation and level of debt. A financial aid adviser may have advice based on your unique situation.
Call the Business Office: Contact your college or university’s business office to see if there is any money left over in your account that you didn’t use. Sometimes you are awarded more money through scholarships, grants, and student loans than you actually need to cover the costs of tuition, fees, and books. If you have money left in your account, use it to start paying off your student loan debt.
Ask about Loan Forgiveness: Read through all of the terms of the loans to see if you are eligible to have your student loans forgiven. In some cases, you can have your loans partially or totally forgiven based on the career path you choose. For example, teachers, police officers, and other public servants may be eligible to have their student loans forgiven.
Reduce Your Interest Rate: If you are ineligible for loan forgiveness, ask each lender about reducing your current interest rate. This can lower your monthly payment, or if you can maintain the same payment with a lower interest rate, you can pay off the balance faster.
Consider Loan Consolidation: If you have loans from multiple lenders, it may be a good idea to consolidate your student loans. This means that you will have one monthly payment instead of writing checks to multiple lenders each month. The best part about loan consolidation is that you can often get a lower interest rate, which means your monthly payment will be lower. Again, if you can continue paying your pre-consolidation amount with a lower interest rate, you will pay off the balance faster.
Recalculate Your Minimum Payment: Your student loan terms dictate the number of years you have to pay off your student loan debt. Instead of letting the lender dictate how long you have to pay off the debt, you can decide to pay off your debt in a shorter amount of time. Once you decide how long you want it to take you to pay off the debt, recalculate what you need your minimum payment to be in order to pay off the balance quickly. Then, pay the higher amount.
No one wants to start off in life in debt. Luckily, you do have options when it comes to getting out of debt quickly. These tips can get you on the right financial path.