Student loan debt has been a rising problem in the US for many years. In 2020, the average student loan debt was more than $37,000 per borrower. With the current economic climate, many borrowers are struggling to make their payments. To help borrowers manage their repayment, here are five strategies for paying off student loan debt in 2023.
1. Create a Budget and Track Spending
Creating a budget and tracking spending is essential for anyone trying to pay off their student loan debt. A budget can help identify where money is going and make it easier to allocate extra funds to student loan repayment. It’s also important to track spending to make sure that it stays within the budget. This can help keep borrowers on track when it comes to repaying their loans.
2. Make Bi-Weekly Payments
Making bi-weekly payments can help borrowers pay off their student loan debt faster. This strategy involves making two payments per month instead of one. By doing this, borrowers can reduce the amount of interest they pay over the life of the loan. They can also reduce the amount of time it takes to repay their loans.
3. Make Extra Payments
Making extra payments is another way to pay off student loan debt faster. This strategy involves making larger payments than the minimum required amount. This can help reduce the amount of interest paid over the life of the loan and shorten the amount of time it takes to pay off the loan.
4. Refinance Loans
Refinancing student loans can be a great way to save money on interest. This involves taking out a new loan with a lower interest rate than the existing loan. This can lower the amount of interest paid over the life of the loan and can help borrowers pay off their loans faster.
5. Utilize Student Loan Repayment Assistance Programs
There are many government programs that can provide assistance with student loan repayment. These programs provide borrowers with options such as debt consolidation, loan forgiveness, and income-driven repayment plans. Borrowers should research available programs to see if they qualify for assistance.
Paying off student loan debt can be a daunting task. However, with the right strategies, borrowers can get on the path to financial freedom. By creating a budget, making bi-weekly payments, making extra payments, refinancing loans, and utilizing student loan repayment assistance programs, borrowers can make progress towards paying off their student loan debt in 2023.