If you are one of the millions of Americans who are struggling to pay off their student loans, you might find comfort in the fact that you are not alone.
In fact, you can easily find reporting that states the amount of student debt has more than doubled over the last 10 years and is now well north of $1 Trillion dollars.
You have invested a lot in your education and as you work to grow your career and reap the rewards of your investment you realize that you still owe a considerable amount. A couple of tips to help you out would be the following:
Check Your Credit Score: It is easy to do and it can let you know how you look to potential creditors. You may think that you don’t care if your score is bad, but it could cause you problems in renting your next apartment or getting a good rate on your car loan.
Even if you can’t do anything right now to improve your score, you should know what it is – you don’t want your next boss or next landlord to know more about your situation than you do.
Create A Budget – And Stick To It: This isn’t like your New Year’s Resolution or your last attempt to “really lose weight this time”. You need to get a complete understanding of your cash flow situation.
You need to make a budget and set aside money for paying off your monthly bills, making your student loan payment and putting some away for retirement (it may seem like a long time off, but even a little can help and you don’t want to be worried about money forever!)
Pay Yourself First: Do you know how much FICA tax was taken out of your check last week? The answer is probably “no”.
An easy way put money away each week to pay your student loans is to set up a separate checking account and have part of your paycheck directly deposited into that account.
While it won’t change the actual “math”, you still have to pay the loan out of your paycheck, sometimes it helps not having that money in your normal account. It can help you learn to live off of less money each week.
Rethink What You Spend Your Money On: When you take a look at the budget you created (see above) you might wonder where all the money goes.
How often are you eating out at lunch? How much does that morning coffee cost you over the course of a month?
Maybe rather than going out to dinner and the bars on Saturday night, you should have friends over to your place.
Ultimately, it’s your money, it’s your life . . . and it’s your debt. If you don’t want to cut back on expenses, you’ll need to earn more money (perhaps it’s time for a job change or time to pick up a part time job in the evenings).
Understanding your debt and living within your means is a key step to being financially secure and financially happy.