According to the Chronicle of Higher Education, nearly 60% of all college students take out student loans, which amounts to about 12 million Americans taking out these loans annually. About 37 million people are still paying off their student loans, according to the Federal Board of New York, with the majority being under 30. The total amount reaches between 902 billion to 1 trillion, with the average student owing almost $25,000.
Many of the young students with loans are finding it difficult in this economy to move beyond college and start families, buy cars, and buy houses. The fall in the economy have led to graduates making less money and having to find jobs that do not have as much promise. Additionally, the average student now has a credit score 15 points lower than before. This has led to the “boomerang” effect for many students, where they return to live with their parents while figuring out their finances and their future. However, there are a few simple tips on how to live with student loans.
If you have private student loans, you can look to loan consolidation. This can typically lower your monthly payment and interest rates, making it easier to pay off your loan. For loans through Sallie Mae and the Department of Education, you have many options for loan repayment. You can choose repayments based on your income, which will ease some of the burden momentarily. With more manageable payments, you can find a way to make your monthly finances stretch longer. However, you will end up paying your debt for more years and end up paying more due to interest. Once you have a strong handle on your loan repayments, then before you know it you may be able to afford to purchase a home, especially if you find lowmortgage interest rates.
In order to pay off your student loans quickly and efficiently, you can find ways to decrease your monthly expenses. Look into how you spend your money and where you can trim the fat. Don’t eat out as much, skip your daily coffee from your favorite café, hit the sales rack more often, and buy food in bulk. There are many ways to save money and stretch every dollar further. You can even look into taking the bus to save money on gas and car payments. Depending on your situation, you can look for ways to cut back on your rent or mortgage. Perhaps you do not need as large of an apartment or can live with roommates. There are easy ways to cut back on your current spending so that you can pay off your debt faster.
Find Supplement Work
Another way to speed up your loan repayment is through finding supplement work. This does not have to be typical jobs. You can consult, walk dogs, perform landscaping, freelance based on your skills, tutor, and many other jobs. Even selling old unwanted items through eBay can bring in additional income.
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