Student loan debt can be very intimidating. I majored in financial management, and even with the skills I learned from my courses, it was still very anxiety-inducing! Unfortunately, people are not taught enough about how to manage their money, which is a crucial skill for every adult, regardless of their profession. Here's are some tips for paying down your student debt:
- Figure out the terms of your different loans. Specifically, there are 2 things you should find out about each of the loans you have taken out. First, which loans, if any are deferred? Some government loans do not begin charging interest until 6 months or longer after your graduation date. Do not make payments on those loans until after the "grace period" has ended. Second, figure out the interest rate on each loan. Government-issued loans, at least when I was in school, had interest rates somewhere between 4% and 6% (roughly). You should pay off the loans with the highest interest rates first, and the loans with the lowest interest rates last. NOTE: at a minimum, you should make the interest payments on all of your loans every month. This will prevent the loan amounts from growing over time.
- Live below your means until your loans are paid off. Once you get out of school and start earning a full salary, it's tempting to go and spend all your hard-earned money. Your future self will thank you if you resist that urge. When I started working full-time, I lived in a small apartment and drove the same car I bought in college for 3+ years. During that time, I was able to pay $1,200 per month to my student loans, which helped me pay them off very quickly. The more you can pay to your student loans now, the better.
- Create a budget and stick to it! There are many ways to budget your money, but it's important to find one that works for you. Make sure you're planning out how you will spend your money, and keep to the plan.
Best of luck!