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3-9-2018 • The Realities of Paying Off Student Loans

CONSIDER THIS: College graduates are finishing school with high hopes, bright futures—and decades’ worth of student debt.

Student Loan Hero estimates the average 2016 college graduate has $37,172 in student loans. All that money can take a decade or more to pay off.

A Pew Research Center survey found 16 percent of adults report having outstanding student loan debt left over from funding their own education. Of those respondents, 22 percent are between the ages of 30 and 44. Another 7 percent are ages 45 to 59. Overall, Americans owe more than $1.48 trillion in student loan debt, according to Student Loan Hero.

Financial experts say the key to avoiding student loan debt is pre-planning; to save up as much as possible before college. But that’s not always possible and sometimes taking out a loan is necessary. If this is you, here are some tips to help you pay off your student loans:

Start paying loans back as soon as possible. Federal lenders will wait six months after graduation to begin sending student loan bills. It can be tempting to wait out that full six months—even if you’ve already found a job. But unsubsidized loans collect interest during that grace period. The sooner you can begin repaying student loans, the more money you’ll save.

Pay as often and as much as possible. As often as possible, try to pay more than once a month or more than your monthly payment. If you need more structure, consider splitting your monthly payment in half and paying roughly that amount every two weeks.

Identify cash windfalls. Tax refunds. Bonuses. Inherited money. Even birthday checks from grandma. Use that extra money to pay down your student loan debt. You’ll be surprised how much windfall cash can add up over the year.

Keep on top of your personal budget. Windfall cash is helpful, but most people will need to use the money in their budgets to pay back student loans. So, it’s important to track earnings and spending habits. Try finding money you can trim from other areas of your budget and add that toward your student loan payment.

Set achievable milestones. Paying off student loan debt can feel overwhelming. Set achievable milestones along the way and splurge a little when you reach them. It’s important to keep yourself motivated.