How to pay off student loans after graduation

With graduation days and graduation ceremonies now in many people's rearview mirrors, it is important that new college graduates start thinking about their financial future. This means don't delay processing any student loan debt you may accumulate. After graduation, you may start your first full-time job, rent an apartment, or even buy your first car. Anyway, you will now face a new monthly bill - your student loan repayment. While some parents are struggling to manage payments, not everyone has this luxury.

While paying off student loan debt is overwhelming, there are some tips to overcome your student loan debt.


1. Ignore the grace period


Most loans have a grace period, the “waiting period” after graduation, during which no loans are required. Although most students believe that the grace period is an economic rest period, ignoring the grace period and immediately starting to repay the loan can save you a lot of money in the long run.


Using an average interest rate of $35,000 on student loans and an average interest rate of 4.29% on student loans, a student who starts paying their loans immediately will save more than $400 in interest expenses.


2. Prioritize loans


What do you do in the face of multiple student loans? you can:


a) Pay off the loan with the minimum balance first
b) Pay all the fees you can pay with the highest interest rate?


If you answer B, congratulations. Repaying your loan with the highest interest rate can save you interest.


3. Register for automatic payment


If you have a stable source of income and financial control, you can choose to pay the student loan bill by automatic payment. Both the Ministry of Education and banks like this repayment method very much, so if you sign up, they usually offer lower interest rates. Most banks offer a 0.25% discount on automatic payments.


Although this does not seem to be a lot of money, it will definitely accumulate over time.


4. Deducting student loan interest from taxes


Every year you pay off your student loan and you have to pay a lot of student loan interest. Make sure to make full use of the student loan interest deduction on the federal tax return. You can request a deduction of all interest you pay, up to $2,500.
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