Student loan debt can be overwhelming, but there are practical ways to manage it effectively. Whether you’re currently in school or already graduated, consider these strategies to ease the burden and take control of your financial future.
1. Enroll in Autopay
Setting up automatic payments for your student loans can save you money. Many lenders offer a discount (usually around 0.25%) if you enroll in autopay. While it may not seem significant initially, this small reduction can add up over the life of your loan. Plus, paying more than the minimum each month accelerates your payoff timeline.
2. Pay off Interest Before It Capitalizes
Interest accrues on most student loans while you’re in school, even if you’re not making payments. Paying off the interest before it capitalizes (i.e., gets added to your loan balance) can prevent your total amount owed from increasing. Even small monthly payments during school can save you money in the long run.
3. Explore Part-Time Programs
Consider part-time programs that allow you to work while studying. By spreading out your coursework, you can reduce the immediate financial strain and potentially graduate with less debt. Look into evening classes, online courses, or co-op programs that combine work experience with education.
4. Utilize Subsidized Loans
Subsidized federal loans don’t accrue interest while you’re in school or during deferment periods. If you qualify, prioritize these loans over unsubsidized ones. They can significantly reduce the overall interest you’ll pay over time.
5. Tap into Second Chance Scholarships
Second-chance scholarships can be a game-changer. When students reject their offers, scholarship dollars return to a pool of available scholarships that a school can they reallocate. Ask your school if they have a second-chance pool.
6. Seek Outside Scholarships
Private organizations and companies offer scholarships that can directly reduce your loan burden. Search scholarship databases at LSAC to start. Some private scholarships don’t come with service requirements, making them an excellent choice.
Remember, every dollar saved counts. By combining these strategies, you can make a significant dent in your student loan debt. Take control of your financial future and explore these options today!
Sources: