What Can You Do to Pay Your Student Loan Debt?
Student loan debt is a significant problem in the United States, with over 44 million people owing more than $1.5 trillion nationwide. It’s no wonder many people struggle to pay back their loans at high interest rates. But there are ways you can reduce your monthly payments and make them easier to manage. Here are some tips for reducing your student loan debt:
Work for a company that offers student loan repayment assistance.
- Student loan repayment assistance programs work like 401(k). Your employer offers you the opportunity to contribute toward student loans, and you choose whether or not to take it.
- Companies that offer these programs often do so as an employee benefit, similar to a retirement savings plan or health insurance.
- Some companies require that workers meet specific eligibility requirements before participating in the program. Others will allow anyone who meets specific criteria (such as being enrolled in school) to apply for student loan assistance at any time during their tenure with the company.
- To find out if your employer offers this benefit, talk with someone in HR or speak directly with your supervisor. They can direct you toward resources on their website that explains how their program works and how employees can use it effectively!
Consolidate multiple loans under one payment.
Student loan consolidation debt is a great way to get organized and make it easier to pay back. If you have multiple loans with different interest rates, repayment terms or a combination of federal and private loans, consolidating them can help lower your monthly payments. This can make it easier for you to keep up with your monthly payments by reducing the overall amount that needs to be paid off each month. According to SoFi, “There is no application fee to consolidate loans through a Direct Consolidation Loan.”
If you change jobs, think about transferring your loan benefits.
If you change jobs, think about transferring your loan benefits. If the new company offers an employer-sponsored 401(k), consider whether it would be better to get your match in that plan than in a traditional IRA or Roth IRA. If they offer health care coverage, this might be worth more than the employer match on your retirement savings account — especially if you were already enrolled in health care through another source such as COBRA (which can cost thousands of dollars per month).
Refinancing can lower your interest rate.
Refinancing can be a great way to lower your interest rate if you’re already paying off your student loan debt. The process is similar to applying for a mortgage: you’ll want to check into options and compare rates with other lenders before choosing one.
When choosing your lender, look at what they offer beyond just their interest rates. Ask about how they handle payments, when they will report late payments (and how often), if any fees are higher than average, and whether they have any programs specifically designed for graduates with student loans.
If you’ve got a lot of student loan debt and are looking for ways to pay it off, there are plenty of options. The most important thing is to work with your lender to find a payment plan that works for you. If that doesn’t work, consider refinancing or consolidating loans to get the best rates possible.