So, Mr. Bruce Mesnekoff let us tell how we can manage our student loans while doing our graduation or after graduation, as right its biggest issue in USA.
- Student Loan Tax Deduction: Now student loans offer tax deductions i.e. you get some money back in your pocket. Instead of using this money to some other leisure activity you can pay the amount as repayment for loans. This way a huge load is off your back and your pending loan amount is reduced drastically.
- Extra than Minimum: As Bruce Mesnekoff suggests, try and add some money over and above the minimum money that is required to be paid as repayment. Be it $20 only but it will add to principal and in long run even small amounts matter.
- Cash Windfall: If ever fortunately you get a good amount of cash from somewhere is it a gift, lottery etc use it to pay back your loan. This will eventually help you paying lesser interest, save money and get rid of the loan debt at a faster pace.
- Jobs That Offer Forgiveness: There are multiple organizations which offer benefits of repaying your student loans and even jobs like teaching or public service offer loan forgiveness in parts or full. For the same certain requirements need to be met for you to be eligible.
- Avoid Repayment Programs: Repayment programs available should be avoided if you want to get rid of loans at a faster pace since these programs decrease your monthly payment but increase the number of years thus resulting into paying more interest eventually.
- Automatic Deduction: Some lenders offer some discounts if the deductions are automated. This means that repayment amount will get deducted from bank account automatically at a specific date of each month. As Bruce Mesnekoff said this could be as less as 0.25-0.30% but we should remember a penny saved is a penny earned!
- Pay Before Actually Required: Different loans have different grace period. This is the time after graduation when loan is not accruing interest and you can actually consider paying starting from grace period. This is taking into consideration that you have a nice job and your finances can be sorted.
- Pay Bi-Weekly/Tri-Weekly: Another famous option by Bruce Mesnekoff is to make the payment biweekly or Tri-weekly i.e. you split the monthly amount into two/three equal parts and pay after 2/3 weeks each. This will reduce the interest and you will end up paying one month’s extra payment at the end of the year.
At last Mr. Bruce Mesnekoff, An author of Famous Book “THE ULTIMATE GUIDE TO STUDENT LOANS” Said, you can choose whatever method seems feasible to you considering your financial management. Just back it up attitude, determination and a hope for a loan free future to achieve your target.
For More Information Contact Bruce Mesnekoff on LinkedIn