How to Pay Off Your Student Loans Fast (2024)

The Standard Repayment Plan—the plan that federal student loans automatically go on if you don’t choose an alternative—spans 10 years, but some options stretch payoff over 20, 25 or even 30 years. If you don’t want debt hanging over your head for a decade or longer, and you can make some room in your budget, there are strategies for paying it off faster.

Paying off your student loans ahead of schedule not only eliminates that monthly bill from your life sooner, but will also save you money on interest. The sooner you get out of debt, the sooner you can breathe a sigh of relief and turn your attention toward your other financial goals.

5 strategies to pay off your student loans ahead of schedule

More than half of students take out student loans to pay for college, with the average debt load upon graduation totaling nearly $30,000. While you probably can’t eliminate your student loan debt overnight, there are ways to speed up your repayment timeline. Here are some approaches that could help.

1. Pay extra on your principal balance

Rather than sticking to the minimum amount due, send extra money to your loan servicer on a monthly or occasional basis. There is no penalty for prepaying student loans.

Use a student loan calculator (such as this one from Discover) to see how additional payments could impact your repayment schedule and interest charges. Let’s say, for instance, that you owe $15,000 in student loans at a 5.5% interest rate, the current rate for federal Direct subsidized and unsubsidized loans for undergraduates.

On a 10-year term, you would have a required monthly payment of $163. But if you could pay $50 extra a month, you’d shave nearly three years off your repayment timeline and save $1,376 in interest. If you could bump up that extra payment to $100, you’d be out of debt almost 4½ years ahead of schedule and save $2,105 on interest charges.

If you’re going to make extra payments, instruct your loan servicer to apply them to your principal balance. Without this instruction, your servicer may save the payment for a future date, which wouldn’t help you pay off student loans faster.

If you owe multiple student loans, consider targeting the student loan with the highest interest rate first (this is sometimes called the debt avalanche method) to maximize your savings.

2. Pay biweekly instead of monthly

Another trick to pay off your student loan debt faster—and with minimal pain—is to make payments on a biweekly schedule, rather than a monthly one. When you pay every two weeks, you’ll end up making 26 half-payments in a year, or 13 full payments. That is one full payment more than the 12 you’d make on a monthly payment schedule without much extra legwork on your part.

“Paying twice a month would help chip away at that debt more quickly,” says Karen McCarthy, who heads up public policy and federal relations for the National Association of Student Financial Aid Administrators.

One extra payment might not seem like much, but it could have an impact. Let’s go back to that example of a $15,000 debt loan at a 5.5% interest rate. If you pay biweekly on the standard 10-year plan, you could save $488 in interest and get out of debt a whole year early. (This calculator from NerdWallet can show how the math would work for your situation.)

3. Refinance for a better rate

If you have a good credit score and a stable source of income, you might explore refinancing your student loans with a private lender. Through refinancing, you may be able to lower your interest rate, which can reduce your monthly payment and make it easier to pay off your loans faster.

Plus, you’ll get the option of choosing a new repayment term. Opt for a shorter term than you have currently if you want to get out of debt sooner. Keep in mind, though, that a shorter term usually means higher monthly payments, so make sure you can afford the bills.

Be cautious about refinancing federal student loans: Doing so means sacrificing federal repayment plans and other protections. If you’re relying on a federal income-driven repayment plan, forgiveness program or other benefit, it wouldn’t make sense to refinance your federal loans.

4. Pay off interest during school and your grace period

Interest starts accruing on most student loans, such as federal unsubsidized loans and private student loans, from the day they are paid out (known as the disbursem*nt date), usually at the beginning of each semester.

“If you can, start making payments while in school,” suggests DePaulo. “Even as little as $25 a month can save you money over the life of your loan and help pay off your loan faster.”

Let’s say, for example, that you borrow $15,000 at a 5.5% interest rate. Paying all the interest in school would cost you $70 per month, but it would save you $4,274 in the long run on a 10-year repayment plan.

To lower your balance when you have to start paying, you could pay off the accrued interest monthly or make a lump-sum payment right before payments start. Consider paying off the accrued interest at other times when you don’t have to, such as during your six-month grace period after leaving school or another period of deferment or forbearance.

The only exception to this rule is Direct subsidized loans for undergraduates, as the government covers interest on these loans while you’re in school and during other periods of deferment. You can still choose to pay down your principal, which will reduce your interest charges later, but you won’t have to worry about interest accruing until your grace period ends.

5. Pursue student loan forgiveness and assistance

If you’re open to switching jobs, consider pursuing a role that would make you eligible for student loan forgiveness or assistance.

There are a variety of federal and state programs offering student loan forgiveness and repayment assistance if you go into certain fields of employment. The Public Service Loan Forgiveness program, for instance, offers full federal loan forgiveness after 10 years to borrowers who work for the government or nonprofit organizations, while Teacher Loan Forgiveness provides partial forgiveness after five years.

Borrowers on income-driven repayment can also get their loans forgiven if they still have a balance at the end of their repayment term. The Biden administration’s new SAVE plan will offer a faster path to loan forgiveness for borrowers with lower principal balances (e.g., forgiveness after 10 years if your original balance was $12,000 or less).

Many states also offer repayment assistance to certain professionals, such as doctors, lawyers and veterinarians, who work in shortage areas or high-need communities. An increasing number of employers are providing student loan repayment benefits to employees, too (up to $5,250 annually is tax-free through 2025).

How to find room in your budget to make extra payments

Making extra payments on your student loans isn’t easy. It can help to make a budget and stick to it. Write down your income and expenses, and look for areas where you can cut back. For instance, you may be able to save money by cooking at home more, using public transportation or living with a roommate or two.

However, Michael Lux, attorney and founder of The Student Loan Sherpa, warns against making a budget that’s overly strict.

“Sticking to a budget is a great way to meet goals, but it only works if you can actually stick with it long term,” says Lux. “For many of us, student loans will take many years and even decades to eliminate, [so] sustainability is the most important thing.”

Plus, you can only scrimp and save so much, so it’s worth considering ways to increase your income. Taking on a side hustle, freelancing for extra income or working toward a promotion at work may help you earn extra cash, which you can put toward your student loan debt. If you receive a windfall, such as a tax refund or bonus from work, you could also funnel that extra money toward your student loans.

“Any monetary gifts, a raise or re-looking at your budget could be an opportunity to help you make extra payments,” says Joe DePaulo, co-founder and CEO of lender College Ave Student Loans.

Signing up for autopay is also helpful, since most loan servicers offer a 0.25 percentage point reduction on your interest rate for doing so. While this might not seem like much, every little bit counts when you’re trying to save money on your loans and pay off your debt faster. Enabling autopay can also help you avoid missing payments, as long as you have sufficient funds in your bank account.

“Borrowers should keep in mind the timing of the automatic deduction, ensure they have the funds available in their checking account and account for it in their monthly budgets so they’re not caught off guard,” says McCarthy.

If you have federal student loans, you may need to set up autopay again before the payment pause ends in October. Even if you had autopay set up before March 2020 when the emergency forbearance started, you’ll probably have to renew it—it won’t restart automatically.

Should you pay off your student loans early?

While you may be eager to get rid of your student loan bills as soon as possible, you have to balance your repayment efforts with other financial goals. Paying off student loans early may not be your priority if you haven’t saved an emergency fund, for instance.

It’s also important to save for retirement. The sooner you start, the bigger your nest egg could grow thanks to compound interest. You don’t want to delay saving for retirement until you’ve paid off your student loans in full, since you’d miss out on valuable time in the market.

“It isn’t always a good idea to devote all of your cash flow to your student loans before you’ve got a handle on all of your other financial obligations and goals,” says student loan consultant Jan Miller.

Consider your student loan interest rates, as well. If your student loans have a low interest rate, under 5% or so, you could potentially earn more by investing your extra cash or keeping it in a high-yield savings account than by paying off student loans early.

“You do want to look at student loans as one piece of your overall financial picture,” says DePaulo. “Prioritizing paying off debt, saving for a big purchase or investing is unique to each individual.”

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More on student loans

• My Student Loans Were Just Forgiven. This Is How It Happened
• How to Pay Off Your Student Loans
• How to Refinance Your Student Loans