Financing your education is one of the most critical aspects in your life, and should be planned and executed carefully. The most challenging part of it all is when you have to handle your student loans responsibly in order to pay off your debt fast. Check out these five practical tips to handle it successfully:
- Save as much as you can during your grace period Students who have recently graduated normally have a few months from the time they graduated to start paying off their student loans. Instead of doing nothing during this grace period, start saving money as much as you can so you’ll be able to pay off your debt fast and without any problem. It’s even better if you can afford to pay a lump sum, as you stand a chance to get 10% off of your student loan debt. Avoid unnecessary spending during this time.
- Understand how your loan works Each student loan from the government or private institutions comes with different terms and payment plans. Understand how your loan works by familiarizing yourself with all the details that need to be known. Next, you need to familiarize yourself with all the payment options. If you’re lucky to get a job right after graduation, you may opt for an income-based repayment plan. Otherwise, you can request a temporary deferment until you found a job.
- Pick the best payment plan The typical option chosen by most people is the income-based repayment plan. This is one of the best repayment plans and is highly recommended since you’ll be able to easily manage your monthly repayment based on your current income. Additionally, you should also find out if your loans can be converted into a scholarship. Some education loans offered by the government or private institutions have a program where you can convert your loans into a scholarship if you meet their requirements.
- Keep living frugally Keep your habit of living frugally even after you graduated and while working on a full-time job. While it feels good to have a career and become an adult, you also have to deal with the reality of paying off your debt and working on it. You can keep sharing expenses and rent with your housemates; carpooling, walking, biking or taking public transportation if you need to get around; and cut unnecessary expenses whenever possible. That said, it’s also good to spend more on healthy foods instead of living on a diet of canned tuna and Maggi.
- Get a part-time job or freelance For the purpose of paying off your student loans, it never hurts to get a part-time job or freelance every now and then whenever possible, even if you’re working full-time. Take advantage of the many apps that allow you to earn side income, like being an Uber driver or renting out your room on Airbnb.
These tips will come in handy even if you’re just about to start your college education. If you’re considering financing your education, you can apply for an education loan online for convenience. Bear these tips in mind to help you manage your education loans when the time comes. By paying them off as soon as you can, you get to enjoy a debt- and stress-free life and avoid struggling from paycheck to paycheck like most of your peers.