Four Simple Ways to Reduce Your Student Loan Debt

News 20 August, 2019

After mortgages, student loans are the biggest economic investment that an American can make, and subsequently come with a significant amount of debt. Families often start saving to help put their children through college as soon as they are born, or even before, just so they have a chance for a good education without having to take on a huge loan to cover the costs.

Even with financial help, loans are often still necessary, and they aren’t going anywhere after you’ve taken one out. There are strategies you can take to lighten the load, though. As a starting point, it’s always useful to use a tool like Elfi’s loan calculator to find out how much you’re going to be expected to pay depending on the size of your loan. 

Apply for assistance from your employer.

If you work for the government, then a repayment assistance program will most likely be available. However, did you know that many private firms are now offering similar help? Their reason for this is to attract newly qualified students. If you’re looking for a job, make sure to research this as an option as a part of their employee benefits. If you already have a job, check in if getting assistance with your repayments is an option.

Consolidate your loan.

If you have more than one student loan, you should consider getting them combined or consolidated into one. The main advantage of this is that you’ll only have one monthly payment to make rather than multiple, which will simplify your finances. You can also renegotiate your payment period either by choosing to extend it, which will reduce your monthly payments, or by reducing your payment period and paying the loan off faster. This is useful if your financial situation changes, and if you’re in a point in your career where you’re earning more. If less, you can renegotiate your loans to best suit your current needs.

Pay in advance.

Depending on the loan you have, you may not start accruing interest until after you graduate. This means the earlier you can begin making payments, the better. If you can get your total balance down in this time, your final interest amounts will be reduced. If you can pay off the whole loan before the interest starts, you’re effectively getting an interest-free loan. However, it will be rare that this is possible.


The faster you’re able to pay off your loan, the quicker you can get your interest levels down, which is what makes your loan balloon over time. To start with, your monthly payments may only cover the interest on the loan, and then 20-30% more. If you can overpay to start with, and bring the interest down significantly, this will help you take control of your loan and will make the monthly repayments much easier to handle later. This may mean sacrificing spending money on luxuries in your earlier years. But then, this strategy can make your economic situation much easier to manage later in your life.