Once graduation day arrives, you get to move out of your dorm, find a real job, make your own meals, and start paying bills. And, like most college graduates, you finally get to start paying on that massive pile of student loans you've been looking forward to for the past four years.
Fortunately, college graduates get a 6 month grace period before their first payment is due on student loans. So, technically, I don't have to make my first payment until November of this year. But that doesn't mean the interest freezes! My interest continues to go up each month, regardless if I make a payment or not. In case you were wondering, this is the super fun part of being an adult (please note the sarcasm)! I really hate being in debt, so my goal is to pay off my student loans within four years. Now, the part you're probably wondering about: How am I going to do this? Today's your lucky day, because I made a summary of my action plan in list form!
1. Start Making Payments NOW
I was fortunate enough to start my first adult job literally two days after I graduated college. One of the first things I did that week was make my first payment on my student loans. I had some money in my savings, and now that I had my first job locked down, I decided to make a payment. It's never too early to start, right? The sooner I start paying off my loans, the sooner I'll be out of debt (I can't wait to celebrate when I make my final payment!). If you want to quickly pay off your student loans, then you better start making payments now. Don't wait six months!
2. Save Money
This step sounds so simple, but it's not that easy. If you have a habit of spending money on things you don't need, then this part will be extremely challenging. I use to spend way more money shopping than I do now. As I've gotten older, I've learned that there are a ton of expenses in life. In my mind, why spend $100 on clothes I'll hardly wear when I can save it and put it towards debt? This isn't an exciting way to think; in fact, I just became aware of how much I sound like a boring adult when I typed that out. But it's definitely a smart way to think. When you cut down on costs and save more, you will definitely thank yourself in the long run! (And you won't regret not buying that shirt)
3. Make a Comprehensive Budget
I'll end up dedicating an entire post to budgeting, so I'll make this brief. Budgeting is simply making a plan for your money and where it will go. I've found that using Excel is much easier for me than using a budgeting app. I'm able to personalize it more and make as many columns as I want. When making a budget, follow Dave Ramsey's advice: "Give every dollar a name". If you have a category in your budget for every single expense, then you will be less likely to overspend.
4. Live With Your Parents (If Possible)
This option isn't for everyone, but if it's possible, definitely move back in with your parents. By living with my parents, I'm saving an incredible amount of money. If there's no way for you to live with your parents, then try to at least find a roommate to cut down on costs. A decent apartment around Louisville can easily be $700 and more a month. By living at home, I'm able to put the money that I'm saving on rent towards my loans, which will help me pay them off even faster.
5. Learn Perseverance
Saving money and putting yourself on a strict budget is hard. There will be times you'll want to give in and spend your money the way you want to. When it gets hard, just remind yourself why you're doing this and why you're trying to pay your loans off quickly. Think about how amazing it will feel to finally have all of your loans paid off.
I hope these tips are able to help you! By doing these things, I've already been able to put several thousand towards my student loans. I'll still be paying them off for a few years, but at least I have a set plan on how to pay them off!
What's your best tip for paying off student loans or any kind of debt? Leave a comment below!
-Mariana
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