Anyone up for paying down your Student Loans a little faster?
If you have Student Loan debt, and you’d like to watch it disappear a little bit quicker, then this hack is for you!
The Hack:
Make Biweekly Payments on Your Student Loans.
How to do it:
Take your monthly payment and cut that amount in half. Pay that amount every two weeks. If you get paid every other week, align an auto payment with your paycheck. If you get paid twice a month, set up the auto pay and check your budget to make sure you’ll have the money to this (I can help!).
Some employers even allow to to deduct the money automatically from your paycheck, saving you that extra step.
Ask HR and take advantage!
Why it Works:
When you pay anything every other week, the calendar works out that there are two months in the year that have an extra week in them, thus you’ll be making additional payments in those months where as making one payment once a month would not have made a difference.
Yes, it’s only a few extra “half payments” but the math has been done and the results are solid. One estimate showed that with $48,000 in student loans, at a fixed 4.5% interest rate, using biweekly payments instead of monthly payments saved approximately $2100 off the loan—which was the equivalent of 19 months of fewer payments! This method works for both private and federal loans. The higher your interest rate (usually on private) the more money saved.
Two cautions:
Consider your budget (again, I’m here!). If you’re not used to the payments coming out at new intervals, this could throw you a little at first.
Most importantly: Both of the half payments need to be recorded before the next month’s due date. You do not want to be penalized for paying under the minimum.
Give it a shot!
I can help!
Unlocking Abundance 