7 Tips to Help You Pay Off Your Student Loans Faster
Post-secondary education is getting more expensive every year. As tuition rises, students are being forced to take out larger loans and rack up more debt. The best way to eliminate your loans is to make more than the minimum payments each month and decrease the amount of interest you pay. Here are some additional tips to help you pay off your student loans faster.
- Make payments while you’re in school
Start paying down your loans as soon as possible. Many student loan providers don’t charge interest until you graduate. Consider getting a part-time job so you can make interest-free payments while you’re still in school.
- Open a separate savings account
Creating a savings account that’s dedicated to paying back your student loans will reduce the temptation to spend your money on something else. Set up automatic transfers into this account so that you can save without having to think about it.
- Create a budget
Assess your spending habits and come up with a budget. Knowing your monthly expenditures can help you make the necessary sacrifices and come up with a plan to pay off your loans faster.
- Apply for student loan forgiveness
Some provinces offer programs that forgive a portion of student loans for those that qualify. Do an internet search to see if there’s anything available in your province.
- Use a loan calculator
There are several free resources online that can help you figure out how much your monthly payments need to be in order to pay off your loans within a certain amount of time. You can adjust the calculations to see how much faster you could pay off your loans by making larger payments.
- Take advantage of tax deductions
Canadians are eligible for a 15 per cent tax credit on the interest they pay on their government loans. You can use this credit to help reduce the income tax you owe.
- Consolidate your debts
Although the interest rate on most student loans in Canada are reasonable, not everyone qualifies for them. If you’ve taken out a loan with a higher interest rate, debt consolidation can help merge your debts into a single loan at a lower rate.
Student debt counselling in Eastern Ontario
D. & A. MacLeod Company Ltd. can help you overcome your student debt. We offer credit counselling in Eastern Ontario to help students repay their loans. Our team of licensed insolvency trustees can propose a practical repayment plan to reduce the burden of your student debts. Contact us today for a personalized guidance.