Paying back your student debt is one of those things that we all worry about. Going to college or university should be an investment in your future – the chance to equip yourself with the tools you need to make a name for yourself in your chosen career. Unfortunately the weight of back-breaking student debt is making that harder than ever for students across the world.
Students over in the UK are having a particularly hard time of this. Their Prime Minister already sat down and tripled British university tuition fee a few years back – it’s just come to light that he recently announced (in the small print of the 2015 Autumn Statement) that he would retroactively hike the prices of student loan repayments for all students who’ve started university since 2012. University really is becoming a heavy investment in the future.
Whether you’re British or American, a foreign or domestic student, the weight of the student loan isn’t getting any lighter for anyone. If your student debt is giving you trouble, a look at our budgeting tips designed to help you pay back your student debt quicker and more effectively. With a little hard work, you could be debt-fee a lot quicker than you initially expected.
Write down how much you spend each month
First things first – you need to know how what you’re working with if you have any chance of paying your student debt back. Over the course of a month keep track of everything you spend money on – a cup of coffee here, a lunch there, gas, bills, whatever. Write it all down and tally it up at the end of the month. If you can work out how much you have left at the end of an average month you can work out how much you can afford to pay back.
Work out how much you can afford to pay back each month
Now that you have a rough idea of your cash flow, you can work out how much you can afford to pay back without causing yourself to suffer. If you don’t have as much as you’d like you may need to cut spending in other areas – give up smoking or high street coffee chains and you can save a small fortune.
If you can, make bi-weekly payments instead of waiting until the end of the month. The reason for this, quite simply, is that you wind up paying less interest as your balance has less time to grow between payments.
Look for alternative sources of income
There are many ways you can bolster your income, with the extra cash going towards paying back your student debt. Thanks to the rise of the internet, there are now dozens of ways you can sell your skills without having to leave the house. Sites like Udemy allow you to make a passive income once you’ve put together a set of online tutorials covering anything from how to play the guitar to how to improve your Photoshop skills. Depending on your skill level, this could help make a sizeable dent in student debt.
Ask for birthday presents in the form of cash
It may not be the most glamorous solution to student debt, but money coming is money that could be going towards your repayments – the faster you pay it back, the less you pay overall.
If you have enough stuff at home and you’re worried about a mountain of token gifts you won’t have any room, need or want for, ask your family to give gifts in the form of cash sum. If it makes life easier for your family, ask them to put it in a pot so that who gives what stays anonymous.
Consider loan consolidation
Look at your student debt like it’s a mortgage. What do you do if you’re struggling to pay off your mortgage when you have other debts getting in the way? You consolidate your unsecured loans into a single, easier to manage repayment.
There are loads of different loan products you can consider depending on where you live, from Scottish Trust Deeds and IVAs to special student debt consolidator loans here in the US. While loan consolidation may not be ideal for everyone, if you’re struggling to just pay off the interest on your debt, it’s worth considering at the very least.
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