How To Pay Your Student Loans Faster | iTHINK Financial

By: iTHINK Financial | Dec 01, 2023

A good education can be important, so it is not surprising that many people take out student loans to access higher education. Student loans provide funding, but also come with financial challenges. Paying off student loan debt is often difficult for graduates carrying this burden. However, while amassing student loan debt may seem financially daunting for students and graduates alike, it is often possible to pay it off ahead of schedule with diligent planning and budgeting.

So, how can you pay your student loans faster? Each person’s circumstances are unique, so there’s not necessarily a universal strategy for paying off student loans early. Still, there are a number of steps you may be able to take and avenues worth exploring. These can range from simply making timely payments all the way to consolidating debt — but everyone is unique and so is their financial situation.

It can be important to explore these strategies so that you can better understand whether they may be suitable for your circumstances. We’ll discuss some strategies that you may be able to use to pay off your student loans faster. Let’s jump in.

1. Making Payments On Time

As simple as it may sound, making timely payments can be one of the most effective basic steps toward paying off your student loans on time, establishing a foundation you can use to make early payments, or prepayments toward your principal, which can enable you to more quickly pay off your student loan debts.

Missed payments don’t just represent inadequate payment to finish off your loan balance early — they can also rack up costs. In addition to the possibility of late fees, which can represent a significant cost, this can lead to amassed interest.

The longer it takes to pay off the principal of your student loan, the more time there is for interest to accumulate over time. Unfortunately, if you’re stuck in a rut of making minimum payments, your principal balance will go down very slowly, leading to the potential for added interest payments. In the long run, this doesn’t only stand to increase the total time it can take you to pay off your student loan — this can also increase the total amount you end up paying as interest accumulates.

2. Making Prepayments To Your Loan Balance

Prepayment can be a great option for reducing the time it takes you to pay off your student loans. However, you’ll need to be deliberate about how prepayments are applied. When possible, if you make payments of more than is due, ensure that the additional amount is paid toward the balance of your loan.

The Consumer Financial Protection Bureau warns that lenders may attempt to credit prepayments to a future bill rather than applying them to the loan balance. This can cause you to be paid ahead in your repayment plan but won’t decrease the time it takes you to pay off your loan unless you continue to make payments each month, even months when you don’t have payments due.

You also may be able to ask your lender or loan servicer to apply additional payments beyond what is currently due to your loan balance or principal.

3. Seeking Resources and Education

While this step isn’t directly a debt repayment step, it’s nonetheless crucial that you familiarize yourself with your options and obligations regarding your student loans. In many cases, this can empower you to weigh various options and make more informed choices in how you pay off your student loans.

Resources, such as those offered by the U.S. Department of Education on, can help you better understand not only what your repayment options look like but whether or not you qualify for additional aid such as forbearance or debt forgiveness.

Seeking further education isn’t just about learning how your student loan works or familiarizing yourself with important topics in that realm. It’s also an opportunity to discover avenues you may not have been familiar with.

4. Taking Advantage of Automatic Payments

As we’ve discussed, missed payments on your student loan debt can be a significant burden — potentially creating more costs, increasing the time it takes you to pay off the principal, and standing to enable the accumulation of more interest in the long run, leading to a higher overall cost to pay off your student loan.

One strategy you can take advantage of is setting up automatic payments through your loan servicer. The benefits of automated payments can sometimes be multifold; in addition to helping ensure that you don’t forget or miss a payment due date by automatically debiting your account when bills are due, some servicers might encourage automated payments by offering incentives such as lowered interest rates when you opt-in.

You can contact your loan servicer and ask them whether they offer any incentives for automated payments. Even if they don’t — this can still be an effective strategy that you can use to reduce the likelihood that you miss a payment.

By taking advantage of automatic payments not only are you reducing the burden of keeping track of and manually paying bills yourself, but you may be positioning yourself for success in making timely payments.

5. Debt Consolidation

For some individuals, consolidating their debts may be a viable way through which they can decrease the total time or amount it takes them to pay them off. However, the effects of debt consolidation can vary widely and may hinge on several factors, including the interest rates and repayment terms you’re able to secure.  For example, if you consolidate your student loans into one consolidation loan, you may find that it takes longer to pay off than all of your other loans would have. As such, it’s important to discuss this potential option with a trusted and experienced financial expert, such as a financial advisor, before considering it.

Bonus - Loan Forgiveness

Loan forgiveness may be an option in certain situations, such as if you’re a teacher, a government employee, work for a nonprofit, are a medical professional, have a disability, or repay your loans under an Income-Driven Repayment Plan, or IDR plan.

In each case, there may be additional eligibility requirements and considerations to take. For example, if you’re a government employee, in order to qualify for loan forgiveness, in addition to having a direct loan, you may need to first make the equivalent of 120 qualifying monthly payments. You’ll have also had to do so while working full-time for a qualifying employer.

In the case of teachers, there are other caveats; Teacher Loan Forgiveness will cover up to $17,500, if you have a direct loan or Federal Family Education Loan, but you’ll also need to meet additional requirements, such as having worked for five consecutive years, full time, in a low-income school or an educational service agency.

Nonprofit employees, like government employees, will need to make 120 qualifying monthly payments working for a qualifying employer and must have a direct loan to qualify for Public Service Loan Forgiveness

To learn more about the different circumstances in which you might qualify for student loan forgiveness, you can visit, where you can find helpful information regarding student loan forgiveness. There are a number of additional considerations to take into account, and there are many situations where individuals may be eligible for loan forgiveness.

Next Steps

By taking proactive steps today, you may be able to unlock positive outcomes in your financial future. But remember — it’s important to discuss these and any financial strategies that you consider with a trusted financial advisor. Strategies such as loan consolidation, for example, can come with serious consequences and may not offer ideal outcomes for you. As such, it’s crucial that you discuss any potential next steps with a financial expert who can help you understand which path forward may be most viable given your circumstances. At iTHINK Financial, we offer a wide range of financial services, ranging from personal finance to business finance. To get started or learn more, be sure to visit us online today.