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10 Tips for Repaying Student Loans

4

Pay More, Pay Often

Get a little extra cash as a gift? Consider allocating some (or all) of it towards paying of your loan debt. ©elise_kurenbina/iStock/Thinkstock
Get a little extra cash as a gift? Consider allocating some (or all) of it towards paying of your loan debt. ©elise_kurenbina/iStock/Thinkstock

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Set up auto-debit to have payments made automatically from your checking account on the days you receive a paycheck. Enrolling in auto-debit will often reduce your interest rate by 0.25 percent, saving you money that way as well. If you have a job, are paid biweekly (every other week) and make loan payments biweekly, you end up making an extra payment every year, saving money on interest in the long term.

Consider putting a raise, a bonus, your birthday cash or an inheritance toward your student loan as well to help reduce your principal, which will in turn reduce your interest. You'll be one more step closer to financial independence.

Read your loan documents carefully. You may need to include a written request that the extra payments be put toward the principal, not toward future payments. You'll also want to check with the lender to be sure there are no limits on payment frequency.

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