5 Smart and effective tips to pay off student loans
Education has become very costly nowadays. Millions of undergraduates take out student loans to cover the education cost. Sometimes, they’re compelled to take out multiple student loans as higher education has become very expensive.
It is essential to remember that each student loan has different payment plan and interest rates. It becomes very difficult for the students to remember the due dates of various loans. If you can, the most important question you should ask yourself is “are student loans worth it?”
Moreover, it has been observed that most of the young people don’t work when they are studying in college. Therefore, it becomes very difficult for them to repay the loans. In these circumstances it is imperative to pay off debt quickly. Go through the article to know about some smart and easy tips to pay off student loans.
Tips to pay off student loans
Here are some effective tips that can help you pay off student loans:
1. Save cash: Try to secure a job or internship during your summer holidays. Deposit a major portion of the salary in a high interest bank savings account. When you have saved some amount of money in the bank’s saving account, talk to a financial advisor. He can tell you effective ways to get highest returns on your money. After graduation, you may utilize the cash (saved through out college years) to pay off debt easily.
2. Take advantage of consolidation loans: You can take advantage of the consolidation loans to pay off student loans. These loans condense your multiple loans into single monthly payments. As the interest rates of the student consolidation loans vary from lender to lender, therefore it becomes essential to shop around.
3. Take advantage of loan forgiveness: Check whether you qualify for loan forgiveness. Here are some jobs that can help you qualify for loan forgiveness:
- Teaching: A part of your federal student loan is likely to be cancelled if you teach in a low-income community.
- Volunteering: If you participate in a number of volunteer programs such as Volunteers in Service to America, Peace Corps and AmeriCorps, then you can qualify for grants for paying off student loans.
- Law: Law students can qualify for government grants provided they work in public interest
- Health care: If you’re a health care professional and work for under privileged people, then a part of the student loan is likely to be forgiven.
4. Borrow money from family: If your family is financially stable, then you can request to borrow money from your parents. You can utilize that money towards payments of the student loans. However, it is advised that you pay your parents back once you are earning income.
5. Make use of the expertise in the financial aid department: You must also contact the person who is in charge of college financial aid department and collect information on the student financial aid programs. Maintain a healthy relationship with the staff of the financial aid department. These people can tell you about the latest student financial aid programs.
Finally, instead of taking student loans, it is better to think of other ways to finance your college education. In this way, you’ll not be required to think about the compounding interest rates of the student loans. You won’t have to think about ways to pay off debt quickly. One of the smartest ways to finance higher education is scholarships.
However, in the last few years, it has become very difficult to get student scholarships. It is possible to improve your chances of securing a scholarship in various ways. It is said that if one fills up around 60 scholarship forms, then he can expect to get a minimum of 6 scholarships, and that’s only a 10% acceptance rate. Be sure to apply for as many as possible.
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