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How to Pay Off Student Loans Fast

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World has suffered a lot due to COVID and lockdown measures. Economies have seen devastating effects and personal income has also declined drastically. People are suffering a lot. On a worse note, it has been more complicated for the students to pay their study loans and student loans. So, they assuredly need some extra strategies that can help them to cope up the current situation and channelize their savings to pay their student loans. Savings are that bridge which will help you cover the sudden gap of unemployment and severe decline in incomes due to the pandemic. These strategies will aim affecting three main pillars that are income earned, expenses incurred and side way strategies that may include interest and investment stuff.

So, coming to the real idea, this article aims at various ways to direct people to save money and pay off their student loans fast. Saving is not at all easy in all of your way, the most unavoidable one are the various distractions that we have to face. Major distractions include unnecessary shopping, irrelevant expenses, and many more. But anyway, you need to make your way through all these distractions and hurdles and direct your aim at your savings goal. We are here to help you out with the chaos. This article aims at acquainting you well with the various methods and strategies that you can follow in order to channelize your income into savings, instead of spending them on irrelevant things that may not be even on your shopping list and pay off your student loans as fast as possible and get rid of your obligations and claims fast. So, what are we waiting for? Let’s begin and take these techniques ahead together.

  • Get on a Budget:

Once you are aware of what your goals are and for exactly what purpose you want to save and your savings amount goal, you can start with channelizing your budget you’re your estimated goals and you can make a corresponding and apt cut in your expenses accordingly.

Get on a Budget:

Your budget should help you in estimating how your expenses are going to match your income, this will enable you to plan your expenditure to curate savings and limit overspending.

 

  • Pay More Than the Minimum Payment

You of course have heard this one before also. It has been correctly said that if you keep the zest to pay only a bit more than the minimum payment amount, then you can save a lot and your loan will get paid earlier also. Let me explain this in a simpler form, imagine you took a loan of $10,000 @10% per annum that is to be paid in five years. If you pay more than the minimum payment that is 1000+2000=$3000, let say you pay $3500. You will have to pay less amount for the interest part and of course, you will get rid of this loan earlier than it was decided.

 

  • Make Some Financial Sacrifices

It is not easy to save money. You face innumerable distractions in your way and crossing them with the zest to sacrifice and get rid of your obligations can be tough. Be strong! Get ready to do some sacrifices and hard work. You can avoid unnecessary impromptu shopping and you can prefer making a list before shopping in order to avail double benefit that is discount on whole sale shopping and the other is limiting your expenditure and easily cutting over spending.

 

  • Apply Every Raise and Tax Refund Toward Paying Off Your Student Loans

Most of the people get over excited whenever they get a raise or a bonus or some extra income from various sources such as tax refund. In over excitement, they usually spent this on irrelevant things and just blew the extra money off and then regret about it and doubt if they actually got some raise. So, better keep this in mind, and instead of ruining your hard work rewards unnecessarily, utilize them in paying your loans.

 

Passive income is that bridge which will help you cover the sudden gap of unemployment and severe decline in incomes due to the pandemic.

Increase Your Income With a Side Hustle

Earnings to meet your planned retirement goals can be another reason for having to build some extra wealth through passive income and this is a strategy that can surely appeal to you too, despite of the fact how much currently you are earning from your primary job. Here, I am mentioning some of the passive income sources that you can start now to add an extra spark to your income and channelized savings.

Renting out property seems simple enough. You just need to buy a house or apartment building and then rent out the rooms to tenants for a nominal fee and you are all ready for a permanent source of income.

  • Advertise on your car and renting

If you are someone who has a car sitting at home, you can make the best use of it to earn some extra money out of it. All you need to do is either rent your car or start accepting advertisements to be hung on your car for the offered product’s promotion.

If you are someone who is interested in learning various languages and you are well acquainted with some of the native and foreign languages, you can jump into the job of an online tutor

  • Daycare

Teenagers are so sensitive of their environment and they try to find happiness in every little thing.

Daycare

So, you can take an initiative to help families in taking care of their children and their daily routines. There are infinite families who have to manage their job as well as children and their families.

  • Monetizing your blog

If you are someone who likes to express his feelings through writing, then starting your own blog can be the best practice and even you can make extraordinary money out of it.

And the list never ends, there are infinite numbers of part time jobs that you can jump into and make some extra passive income that will help you achieve your goal of getting rid of loan as soon as possible.

  • Start Investing your savings that provide good rewards:

Every investment option comes with many pros and cons. So, while deciding where you want to invest, all you have to do is sort out your preferences, compare various options and the risk associated and then opt for the right one. Here, I am mentioning some of the best investments that provide best rewards as compared to others. Just sort out your preferences and risk bearing ability first!

  • Debt mutual funds

Debt mutual fund schemes are the perfect choice for investors who are more into steady returns than expecting a higher return possibility.

  • Equity mutual funds

Equity mutual funds

Equity mutual funds are schemes that predominantly on your behalf invest in equity stocks.

REITs are a collection of properties operated by a company (aka a trust) that uses money from investors to buy and develop real estate.

  • National Pension System (NPS)

National Pension System (NPS) is an investment that is focused on retirement plans and savings.

  • Certificates of Deposit (CDs)

A certificate of deposit or CD is a financial investment with the least associated risk factors and is offered by banks.

  • Direct equity

Equity has been able to deliver higher than inflation-adjusted returns compared to all other asset classes.

Direct equity

Summing up, as it has been perfectly said that every coin has two sides. Relating this with the current situation, we can correctly say that each source comes with associated research. Every investment option comes with many pros and cons. So, while deciding where you want to invest, all you have to do is sort out your preferences, compare various options and the risk associated and then opt for the right one. It can be difficult to avoid your distractions, especially those which are your favorite and you did not want to compromise for, but just keep in mind for which purpose you are saving and you may end up with the exact potential amount of saving that you were aiming and expecting to reach that goal.

So, this article aimed at acquainting you well with the various methods and strategies that you can follow in order to channelize your income into savings, instead of spending them on irrelevant things that may not be even on your shopping list and pay off your student loans as fast as possible and get rid of your obligations and claims fast. I hope this made justice to your queries and confusion and you are sorted with your chaos. If you are still left with some questions, we are always here to help you. And we are open for all the suggestions every time. Always remember it is never too late or too early to start something new and learn new things in your life.

Read This Also: Best Paying Jobs in Finance

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