Over 43.5 Million Americans Struggling with Student Loan Payments

Did you know that more than 43.5 million Americans are currently burdened with student loan payments? It’s a staggering number, and for many, this month will mark the first time in over three years that they will have to face their student loan bills once again.

The Average Student Loan Balance: $37,720

When you consider that the average student loan balance is a hefty $37,720, it’s no wonder that tackling this debt can feel overwhelming. However, overcoming this financial hurdle can provide a significant boost to your overall financial well-being and make achieving your other goals much easier.

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1. Set Payment Goals

Don’t let the daunting figure of $37,000+ deter you. By setting achievable payment goals, you can take control of your student loan debt. Break your overall debt into manageable chunks, making it easier to tackle. For instance, if your monthly student loan bill is around the average of $337, aim to pay $400 per month. This additional amount will help you get ahead of your payments and save on interest charges. Make sure that your loan servicer applies the extra funds towards your principal balance, accelerating your progress.

2. Create a Payment Plan

To keep yourself on track, consider creating a payment plan. If you can set aside $100 every week, you’ll reach your goal of paying $400 per month. Taking it a step further, opt for biweekly payments instead of monthly payments. By doing this, you’ll end up making 26 half payments over the course of a year, effectively making an extra full payment towards your student loan annually.

To ensure your payment plan is successful, follow these quick tips:

• Create a sub-savings account dedicated to student loan payments.
• Set up automatic weekly transfers from your core account to your student loan savings account.
• Inquire with your loan servicer about automatic biweekly payment options.
• Consider enrolling in AutoPay to enjoy a 0.25% interest rate reduction.

3. Keep Tabs on Your Finances

An essential part of managing your student loan debt is closely monitoring your expenses. Track your spending for the next 30 days to identify areas where you can make cuts. Small splurges, like a daily $5 cupcake, may seem insignificant, but over time they can add up to a significant amount that could be better used towards your student loan repayment.

Moreover, pay attention to your housing expenses, which are likely your largest monthly necessity. Aim to keep your total monthly needs, including utilities, insurance, and food, below 50% of your income. By minimizing essential expenses, you’ll have more disposable income to allocate towards your student loan repayment.

Your Student Loan Payoff Victory Awaits

Maintaining control over your student loans can be anxiety-inducing, especially without a solid plan. That’s why creating a budget is crucial. It allows you to gain a clear understanding of your financial situation and what is realistically achievable. Once you’ve determined the best course of action for your budget, you’ll be well on your way to conquering your student loan debt.