10 Strategies to Pay Off Student Loan Quickly After End of Extension
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Rumors have swirled about whether the student loan moratorium will be extended once again, but that is becoming less and less likely. As it stands, all borrowers should prepare to begin repaying federal student loans in September 2022, as advised by the US government.
How to pay off student loans fast
The following 10 tips can help show people how to pay off their student loans faster:
Try these tips:
- Cut unnecessary subscriptions
- Use discount codes and store apps
- Make grocery lists
- Use budgeting apps
- Limit utility spending
- Avoid food waste
- Choose cheaper entertainment options
- Pay off and transfer credit card balances
- Buy store brands
1. Cut unnecessary subscriptions
Did you know that the average millennial subscribes to 17 media and entertainment subscriptions? In addition to streaming services, this might include a gym membership, newsletter, or Patreon subscription that has been completely forgotten. Nearly 42% said they didn’t know they were paying for subscription services they no longer used.
Needless to say, there are usually at least one or two subscriptions that can be cut to save more money each month or year. Check automatic payments made from banking apps or search for the words “subscription renewal” in your inbox to target any potential subscriptions that may be worth canceling.
If it turns out that a subscription is deemed essential for business or similar purposes, consider upgrading to an annual plan instead of monthly payments to save money on the cost of the subscription.
- Ability to quickly reduce costs
- Some subscriptions may be essential for work
2. Use discount codes and store apps
Coupon code apps and grocery store apps can be great ways to save on fixed expenses each month. It doesn’t mean sacrificing quality either. Fetch Rewards is a sample discount app associated with thousands of popular brands for Food, Homeware, and Health & Beauty.
Similarly, retailers such as Target have apps that alert users when there are relevant discounts or sales windows to give customers more bang for their buck. Just make sure you don’t overspend or do impulse shopping when using these apps.
- Savings on groceries and household items
- Users may end up buying useless items
3. Make shopping lists
As convenient as grocery app discounters are, shoppers often tend to buy more than they should. By taking the time to prepare an exact list of what you need before heading to the store, you can save time browsing and only spend money on the essentials. This will add to long-term cost savings that can be used to pay off a student loan.
4. Use budgeting apps
Another way to pay off student loan debt fast is to use the best budgeting apps. The advantage of apps like PocketGuard is the ability to compile entire financial lives in one place to track all incoming and outgoing payments. They help you get on top of your loan repayments in a manageable way while learning better financial habits at the same time. The only downside is the subscription price with some versions, so always go for the free service.
- Excellent financial tools to manage inflows and outflows
- Upgrading services beyond the basic plan usually requires payment
5. Limit utility spending
Utilities are one of the sectors where costs are rising rapidly due to inflation – and they are a silent killer. By staying aware of water usage, remembering to unplug appliances that aren’t in use, and simply adjusting thermostats, you can save hundreds of dollars each year. Although prices are usually out of consumers’ control, switching providers can also be a good idea to get price savings.
- Rising utility prices are out of control
6. Avoid food waste
Preparing meals ahead of time and freezing leftovers can be great ways to maximize the amount you get from your grocery spending. While it may be difficult to get started at first, it’s a worthwhile habit to save more each month to fund student loans.
- Cost savings
- Getting into the habit can be hard
7. Opt for cheaper entertainment options
It’s important to maintain a good social life, but it shouldn’t break the bank. You can provide alternatives to physically attending movies and sporting events by hosting events yourself at home or arranging meetups at a friend’s house. Prioritizing restaurant meals may also be another option.
Adopting hobbies such as walking and running can allow you to explore new areas at no cost. YouTube can also be a great free alternative for learning and entertainment options.
- Cost-effective alternatives are available in abundance
- Limits social experiments
8. Pay off and transfer credit card balances
Credit cards are part of everyday life for many consumers. But it is essential to avoid exorbitant annual percentages — the average is currently 17.3%. Pay off balances as soon as possible to avoid incurring additional fees and look for credit card promotions that will offer 0% APR for introductory periods. This will leave you with all the benefits, but add more money for loan repayment.
- Minimize interest payable
- Requires research to find the best deals
9. Buy store brands
Private labels are usually less expensive because the companies do all the packaging in-house, avoiding the need for advertising. Although store brands are not always on the same level, in many cases there are cheaper options for generic products.
- Quality can be random
Homeowners can decide to refinance their mortgages to get better overall rates that lead to cost savings. As interest rates rise, now may be the time to get a better rate with lower monthly repayments while it’s available.
If you have separate private student loans, you may want to consider refinancing them as well to secure lower rates. Some companies like SoFi have specialized in this area.
- Fares can change either way
Does it make sense to pay off student loans as soon as possible? Absolutely. Once the burden of student loans has been lifted, consumers open the doors to much more freedom without having to worry about lingering debt. The tips above should hopefully help you reach your goal faster.
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