Five Ways to Eliminate Student Debt

Sometimes is seems like the only way to pay off your student loans is to live like a monk and join the Peace Corps. If you’re not ready to give up your lifestyle, never fear! You absolutely can pay off your student loans and still live a totally normal life. Here are five tips to help you on your journey to debt-free living:

1. Don’t default. While starting a list with a “don’t” may seem cheap, it’s totally necessary. Defaulting on your student loans is one of the worst things you can do for your financial life. If you go 270 days without repayments, student loan companies can start garnishing your wages. The interest rates and late fees will continue to rack up. That’s not the worst part. Most student loans can’t be discharged as part of a bankruptcy. No matter what you do, you’ll have to pay them. So buckle down and make those payments.

2. High interest rate hell. Do you know which of your loans has the highest interest rate? You should. If you hold multiple loans, check to see where your interest rates are. Any time extra cash comes into your hot little hands, put it toward your loan with the highest interest rate. The only exception is if you have a loan or two that you can pay off entirely (even if it’s not the one with the highest interest rate). In that case, wiping out one debt completely may be more helpful.

3. Cut down on coffee. Maybe your crutch isn’t coffee, maybe it’s buying My Little Ponies. Whatever your “small indulgence” is, cut back or eliminate it entirely. It’s these little extras that eat into your budget. They’re insidious – one minute, you’ve got twenty bucks, and the next minute you have the Special Edition Pinkie Pie figurine. Those nickels and dimes add up, and saving them could help you pay down your debt faster.

4. Look for new opportunities. If you’re seriously losing your mind over your student loans, you could try out one of the many different organizations that exchanges your time and energy for student loan money. Not all programs require you to move to foreign countries or even leave your city. Make sure you look for programs in big cities nearby. The big national programs like AmeriCorps aren’t the only name in the student loan repayment game.

5. Get a job. Whether you already have a job or not, there’s plenty of opportunity for a small second job. Even minimum wage jobs at part time hours can add up to serious bank at the end of the year. Consider working online: Online tutoring and freelance writing are great ways to earn extra cash.

Don’t let your student loans get the best of you. Yes, you’ll be repaying them for a long time. But unless you figure out a solution, you could be paying them for a lot longer. There’s light at the end of the tunnel. Just use your financial smarts and these tips to get rid of your student loan debt for good.

About the Author

Carly Lance is a blog coordinator for Personal Bankruptcy Canada, a company of bankruptcy trustees that helps people with bankruptcy in Canada. Frugal may be her middle name, but Carly does it with class – which is why she loves to write about saving money, to help others learn from her cheap (but classy!) ways.

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Tags: AmeriCorps, Canada, Credit card, Debt, Financial services, Loan, Peace Corps, Student loan

Category: Debt