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student debt

9 Strategies to Pay Off Your Student Loans Quickly in 2018

Was your New Year’s Resolution in January to finish off your student loans once and for all? With 44 million Americans carrying some student debt, at least you know you are not alone in that goal. If you can see the finish line in sight, but just need to make an extra push to the end, we are here to cheer you on! Here are nine ways to make 2018 your last year paying off student debt.

Calculate Your Current Loan Payoff Date

The first step to paying off your debt ahead of schedule is determining your current debt repayment timeline. Calculating that date will give you a clear date to try and beat. It will also help motivate you to know how much interest you would shave off by paying off your loan earlier. While this isn’t exactly a repayment strategy, it is a motivating exercise that will get you excited about taking the next steps. Check out our Student Loan Repayment Calculator to figure out your current repayment date.

Start Paying Your Loans off During the Grace Period

Did you just graduate this year? Congrats on earning your degree and already refocusing on knocking out those student loans. While you might see your current six month grace period from your federal student loan as a needed break before you start in on payments, it is actually a great time to get started. During the grace period, you can make a dent earlier than your peers on the principal due.

Pay More Than the Minimum Payment

This is the most popular recommendation because it can greatly reduce your time spent in debt. Paying down your principal ahead of schedule also means you avoid unnecessary interest payments. Making a larger dent in your debt each month will have an outsized effect over time, even if it doesn’t feel like a much larger payment each month. Make sure to pick a sustainable amount over the minimum payment so you can keep your budget in line.

Apply Lump Sum Payments to Your Loans

Even if you can’t consistently put more towards your loan payments, any cash windfalls you hadn’t originally expected can be immediately applied to your loan. Whether it is a bonus at work, an unexpected tax return, or maybe even a cash gift from family or friends. Put your hard-earned bonus or tax return back to work for you by making a one-time large payment on your loan balance.  It is almost like a surprise cash windfall you get to receive twice!

Utilize the Debt Snowball or Avalanche Method

The Snowball debt repayment method is where you pay off your student loan with the lowest balance first, while still making the minimum payments on any other loans. This way you knock out a greater number of loans more quickly and get that sense of accomplishment before facing off with higher principal loans. The Avalanche method is where you focus further funds on the loans with the highest interest rate first while continuing to pay the minimum on any low rate loans you also have. This method will save you more money on interest payments over time. Selecting a method involves deciding what you will find more motivating as you make your debt payments, and which will help you stay on track.

Refinance Your Student Loans

Refinancing is another popular option for graduates who received an interest rate that doesn’t reflect their improved financial position after school. The goal of refinancing is to consolidate your loans, if you had more than one into a single monthly payment, and lower your interest rate for monthly payments. Lowering your interest rate could mean saving thousands in payments on interest, that would not have even been applied to your principal loan balance. 

Volunteer Your Time

While volunteering is good for the soul, it could also have an impact on your student debt. is a great resource to search for volunteer opportunities in many different fields, but also helps volunteers make a dent in their student debt. Volunteering within your career-field can also be a great resume and network building tool.

Cut Expenses to Increase Loan Payments

The easiest way to find more money in your budget for student loan payments is to spend less on other parts of your life. Look through your credit card expenses, where are you spending more than you should? Do you still pay for a subscription service you haven’t been using? Not all of these changes mean sacrifice. Rather than dinner out with friends, invite people over and have everyone bring something. Especially if the finish line is near, making coffee at home rather than ordering on your way to work each day will taste that much sweeter knowing 2019 will be a debt-free year.

Apply a Raise to Increase Your Payments

Did you get a raise this year but are still only making minimum payments on your student loans? Save yourself further interest payments in the long run and put that added income back to work. Continue with the budget you had before the raise and deposit larger payments towards your student loans. While it can be tempting to treat yourself after a raise and adjust your lifestyle to your new paygrade, resist the temptation! You already know you can live at your previous income, and paying off your loans off is a much smarter investment.

This article was written by Carolyn Pairitz Morris, Senior Editor at Earnest.

Disclaimer: This blog post provides personal finance educational information, and it is not intended to provide legal, financial, or tax advice.