How to pay off student loans after graduation
1. Ignore the grace period
Most loans have a grace period, the “waiting period” after graduation, during which no loans are required. Although most students believe that the grace period is an economic rest period, ignoring the grace period and immediately starting to repay the loan can save you a lot of money in the long run.
Using an average interest rate of $35,000 on student loans and an average interest rate of 4.29% on student loans, a student who starts paying their loans immediately will save more than $400 in interest expenses.
2. Prioritize loans
What do you do in the face of multiple student loans? you can:
If you answer B, congratulations. Repaying your loan with the highest interest rate can save you interest.
3. Register for automatic payment
If you have a stable source of income and financial control, you can choose to pay the student loan bill by automatic payment. Both the Ministry of Education and banks like this repayment method very much, so if you sign up, they usually offer lower interest rates. Most banks offer a 0.25% discount on automatic payments.
Although this does not seem to be a lot of money, it will definitely accumulate over time.
4. Deducting student loan interest from taxes