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How To Pay Student Loans Off Faster

2 min read

If you borrowed money to attend college, you are not alone. Many American students have student loan debt, that’s why have some strategies for you to pay off your student loan debt faster.

Pay more toward the loan principal 

Although you don’t have to start paying back federal student loans until six months after graduation, the sooner you can begin making payments, the better. Making additional payments beyond the set amount will help you pay off the loan faster.

However, student loan servicers, which collect your payments, may apply the extra amount to next month’s payment, advancing your next due date, but not helping you pay off the loans faster. Be sure to request that your servicer apply extra payments to the principal loan balance.

Refinance your loans

Another way to pay off your student loans faster is by refinancing them into a single private loan, preferably at a lower interest rate. Although your monthly payment may increase, applying for a shorter loan term will allow you to pay the debt off faster and save you money in interest.

Sign up for auto pay

Enrolling your federal student loan in auto pay can save you money, too. Many student loan servicers offer a quarter-point interest rate discount if you set up automatic payments from your financial account.

Put extra earned money toward your loan principal

Finally, applying any extra funds you earn toward the principal loan balance will help reduce it more quickly. Consider applying funds from a raise at work, a tax refund, or extra income earned in addition to your full-time job.

To help members pay back student loans faster, AlumniFi provides members access to Changed which rounds up everyday purchases and puts the extra funds toward the member’s student loans. For instance, if you spend $2.45 on your next cup of coffee, $0.55 will be rounded up and put toward your student loans.

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3777 West Road
East Lansing, MI 48823

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(855) 955-2965

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