Student loans seem like a good idea while you are in college and trying to figure out how to pay for everything. They can help you fund tuition, books, and relieve pressure to make ends meet until you land that big job after graduation. Unfortunately, once you do finish up, it is time to pay back what you borrowed. And this can be tough – especially if you borrowed all throughout school and accumulated a significant amount of debt. Freedom Debt Relief reviews of student loan debt show that the average college graduate’s balance is around $33,333.
Many young adults feel overwhelmed, and about 11 percent end up defaulting on these loans. However, there are ways to eliminate this debt quickly. It won’t happen overnight, but if you are diligent, you can whittle it away much faster than you think. Freedom Debt Relief reviews these top tips for paying down your student loan debt.
Tip #1: Look for a Company Match
Today, many companies recognize how burdensome this debt feels, and as an added company perk to attract the right employees, they even offer a company match to pay off your college debt. In some ways, it is like a 401k plan. You pay down your debt and your company matches the amount up to a certain percent. Freedom Debt Relief reviews show that the average amount that employees contribute is $100 to $200 a month.
Tip #2: Refinance Your Loan
Refinancing won’t make your loan go away, however, it can reduce the amount that you owe for the duration of the loan. Freedom Debt Relief reviews of refinance programs reveal that, on average, you can cut your interest rate by around two points when you refinance. So, if you owe around $54,000 (for example) and reduce your rate two percent, you could save over $6500 on the average loan.
Tip #3: Pay More than the Minimum Amount Due Each Month
As with any other debt, the more you put towards it, the sooner you can pay it off – and for less money. For example, if you owe $35K on student loans, at a 5.7 percent interest rate, you’d owe $383 a month. According to Freedom Debt Relief reviews, if you put an extra $150 towards the loan each month, instead of paying it off in 10 years, you could pay it off in about six and a half years. Plus, you could save $4K in interest too!
Tip #4: Don’t Count on the Lottery…. or Uncle Sam to Save you from Your Debt
Yes, it would be awesome to win the lottery, pay off your student loan debt and be done with it. And it would also be great if the government forgave your loan. While there is a slightly better chance of getting into a government loan forgiveness plan than there is winning the lottery, the odds are still slim. Freedom Debt Relief reviews of this government program show that less than 10 percent of people even qualify for it. The eligibility rules are very restrictive and if this is your strategy, you will probably be disappointed.
Your debt did not happen overnight, and it isn’t going to go away overnight either. However, with a little diligence, and mindfulness of the programs and solutions that are available to you, you could eliminate it much sooner than you anticipated.
Note: This is a sponsored post.