Most people with student loans choose to keep their loans around for the tax break or because it has a low interest rate. However, why would you want to do this when you could pay off your student loan early and free up hundreds of dollars a month to do with what you would like? Just because most student loans have a low interest rate does not mean that it should hang around until the day you die. Instead, start working through these steps and get Sallie Mae off your back and out of your home.
Find out How Much you Owe
Before you begin trying to pay off your student loan early, it is best to find out how much you owe on it. Find your latest statement for your student loan and figure out how much you owe and what your interest rate is. You can use this information to find out how long it will take to pay off your student loan at the current rate and even how much you should pay extra on your loan to get it paid off in a certain amount of time. So make sure to get a hold of your statement to get this useful information.
Get a Second Job
In order to pay your student loan off early you are likely going to need to bring some extra money. Getting a second job or doing different odd jobs is a great way to do this. Decide how much extra you want to make and then find a way to bring in that money. You can donate plasma, deliver pizzas, tutor students or even write online in your spare time. Making extra money to put toward your debt does not have to be difficult or take up a lot of your time, so long as you are meeting your financial goal.
Live Frugally
Try to remember how you lived back in college. Lean how to cook cheap meals, find free entertainment and maybe even get a room mate. Find ways to cut back on your expenses and apply the money you save toward your loan. Remember, the financial sacrifices you make now will pay off in the long run. You have likely lived like this before, so it shouldn’t be that hard to do again. So start cutting those extra things that you really do not need.
Apply Extra Money Toward Principle
Once you have extra money to pay off your student loan, be sure to apply that money toward the principle balance on your loan. Whenever you make the payment, be sure to specify that the extra money you pay should go to paying off the principle and not toward next month’s payment. By paying down your principle balance you will be saving money on interest and getting that much closer to getting Sallie Mae off your back.
Though it may take time and hard work, paying off your student loan early can be a very rewarding experience. Not only will you be freeing up hundreds of dollars a month, but you will have the satisfaction of knowing that you will not be paying for your college education for the rest of your life. So make the sacrifices now so you can live the rest of your life without that student loan hanging around.