13-Step Plan to Jumpstart Your Student Loan Debt Repayment

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Student Loan Debt Repayment

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You’re stuck with student loan debt and want to pay it off, but you’re not really sure where to start. You’ve heard of different repayment options and strategies, but they all seem overwhelming.

You’ve come to the right place. By following this guide, you can take easy, actionable steps toward launching your loan repayment and paying off your debt. Even if you don’t do everything on this list, tackling at least some of these tasks should help move the ball forward on your student debt.

Step 1: Add up your debt
Step 2: Review your interest rates
Step 3: Calculate your daily interest
Step 4: Choose a repayment method
Step 5: Sign up for autopay
Step 6: Evaluate all of your expenses
Step 7: Have a no-spending day each week
Step 8: Create a meal plan
Step 9: Sell your old stuff
Step 10: Pick up a side hustle
Step 11: Check your credit score and credit report
Step 12: Consider refinancing
Step 13: Make an extra payment

Step 1: Add up your debt

Many of us graduate without an accurate picture of how much student loan debt we actually have. Between various loans and different interest rates, the total damage may not be as clear as it should.

To conquer your student loan debt once and for all, it’s crucial to know exactly what you owe — right down to the penny.

To get started, log in to your loan servicer’s website and, one by one, add up the amounts that you owe on all of your loans in an Excel spreadsheet or on a piece of paper.

If you’re not sure who your loan servicer is or which private lender you owe money to, then check out our guide on how to track down all your student loans.

Step 2: Review your interest rates

Once you know the amount your total debt and identify your loan servicer, it’s time to review your interest rates. Your interest rates could vary widely depending on the types of loan you have. Federal and private loan interest rates differ, and some might be variable-rate loans while others are fixed-rate.

Understanding your interest rates is important not only for knowing what you’re being charged for the loans, but also for devising a smart plan for repayment. You can learn what your interest rates are from the information provided by your loan servicer. As a final step, write down the interest rate for each loan next to its outstanding balance.

Step 3: Calculate your daily interest

Once you have all of the interest rates written next to the outstanding balances on your loans, it’s time to calculate your daily interest. First, find out what the average weighted interest rate is for all your loans, using this interest calculator. Next, take the weighted rate and plug it into the following formula:

(Weighted interest rate) × (Current principal balance) ÷ (Number of days in the year) = Daily interest

For example, let’s say that you have $50,000 in debt at a 7% interest rate:

(0.07) × ($50,000) ÷ (365) = $9.58

That means that you have to pay $9.58 per day in interest. Calculating your daily interest is a painful but necessary step, for it puts into focus how much you have to pay in interest each day. That amount should help motivate you to pay off your debt.

Step 4: Choose a student loan debt repayment method

If you’re struggling to keep up with your student loan payments, then it might be worth looking into an income-driven repayment plan (at least for your federal loans — private loans aren’t eligible for this).

But if you’re able to keep pace with repayment and want to use a little extra from your income to speed things up, then there are a couple of methods available for tackling your debt. For one, you can use the debt snowball method, which involves paying off the loan with the smallest balance first and the minimum amounts due on the rest of your loans.

Or, there’s the debt avalanche method, which involves paying off the loan with the highest interest first and the minimum amounts due on the rest.

Though the debt snowball method can be more motivating, the debt avalanche method is usually more cost-effective, since you pay off the most expensive loan first. In any case, choose the method that feels right for you.

Step 5: Sign up for autopay

One major drain on your mental energy as you repay your student loans is simply remembering to make the payments on each one on time. So, instead of relying on your memory or setting up calendar reminders, sign up for autopay.

As the name implies, autopay automatically withdraws payment from your checking account and typically comes with a 0.25% interest rate discount. If you’re worried about overdrafts, then make it a daily habit to check your account balances. Enrolling in autopay can make student loan repayment easier as well as save you money.

Step 6: Evaluate all of your expenses

Because you want to pay off your student loans, you need to evaluate all of your expenses and identify areas where you can cut back. Start by listing all of your expenses, including rent, food, insurance, transportation and entertainment.

Look at the list for areas where you can reduce spending. For instance, if you have a gym membership that you never use, then cancel it and put that money toward your debt. If you’re paying for an unnecessary cable package or an elaborate phone plan, then call your internet and phone provider to negotiate a lower payment. Companies want to keep you as a customer, so it doesn’t hurt to ask.

Step 7: Have a no-spending day each week

Though spending money can seem like a natural, necessary part of our lives, it’s smart to occasionally have a “no-spending day” when you don’t use any money at all. Once a week, give your finances a break and keep your wallet shut. Instead, estimate what you might have spent and put that extra money toward your debt.

Step 8: Create a meal plan

When you’re trying to pay off student loan debt, food expenses can really take a big bite out of your budget. It’s also easy to justify food expenses because we have to eat.

But instead of spending all of your extra money on eating out, create a meal plan. A meal plan is like a budget for food — you plan ahead what you will eat and what ingredients you will need.

Meal plans can save you money because you stick to buying what’s on the list and what’s part of your plan, instead of randomly splurging on Goldfish crackers or peanut butter cups.

Step 9: Sell your old stuff

If you’ve got stacks of old CDs, books and clothes that are just collecting dust, then it’s time to get rid of them and make some money. You can take your old things to local stores and resell them for cash.

For old items that these stores don’t buy, consider selling them on Craigslist, eBay or even at a garage sale. Then, put all of the money you make toward your student loan debt.

Step 10: Pick up a side hustle

When you want to pay off student loan debt, cutting back on spending is only one part of the equation. The other part is earning more income from a job on the side, which can often be fun and give you added experience.

There are many ways to make extra cash. Consider working in the sharing economy, starting to freelance, or taking up a gig from the multitude of ones available.

Step 11: Check your credit score and credit report

When you’re paying off student loans, you want to make sure that you maintain good financial health. One way to check your financial condition is to review your credit score and credit report. Your credit can determine whether you get approved for an apartment, student loan refinancing, a car loan and much more.

Get a free credit score from LendingTree and a free credit report from AnnualCreditReport.com.

Step 12: Consider refinancing

One excellent way to save money on paying back your loans is through student loan refinancing. Refinancing allows you to consolidate your debt into one monthly payment and possibly get approved for a better interest rate.

With student loan refinancing, you may be able to save money in interest. Check out these options for student loan refinancing and review their eligibility requirements to see if any of them are right for you. Note, however, that refinancing federal student loans has some drawbacks, so make sure to consider both the pros and cons before acting.

Step 13: Make an extra payment

Though you enrolled in autopay for your minimum monthly payments, that doesn’t mean that you can’t make extra payments. With extra payments, you can cut down on your overall interest charges and start chipping away at your principal balance even faster. An extra $25 or $50 payment here and there will add up over time.

And if finding the spare funds to pay extra seems to be a heavy lift, consider using the biweekly payment method. This involves paying half your monthly student loan bill every two weeks, so that you end up each year with an extra month’s worth of payment automatically.

By using this 13-step guide, you can make clear, steady progress toward achieving your student loan debt repayment goals and conquering your student loans by taking manageable steps.

Michael Kitchen contributed to this report.

Interested in refinancing student loans?

Here are the top 6 lenders of 2021!
LenderVariable APREligible Degrees 
1.89% – 5.99%1Undergrad
& Graduate

Visit Splash

1.99% – 5.64%2Undergrad
& Graduate

Visit Earnest

1.99% – 6.84%3Undergrad
& Graduate

Visit CommonBond

2.25% – 6.88%4Undergrad
& Graduate

Visit SoFi

1.91% – 5.25%5Undergrad
& Graduate

Visit Lendkey

1.89% – 5.90%6Undergrad
& Graduate

Visit Laurel Road

Check out the testimonials and our in-depth reviews!
1 Important Disclosures for Splash Financial.

Splash Financial Disclosures

Terms and Conditions apply. Splash reserves the right to modify or discontinue products and benefits at any time without notice. Rates and terms are also subject to change at any time without notice. Offers are subject to credit approval. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet applicable underwriting requirements. Not all borrowers receive the lowest rate. Lowest rates are reserved for the highest qualified borrowers. If approved, your actual rate will be within a range of rates and will depend on a variety of factors, including term of loan, a responsible financial history, income and other factors. Refinancing or consolidating private and federal student loans may not be the right decision for everyone. Federal loans carry special benefits not available for loans made through Splash Financial, for example, public service loan forgiveness and economic hardship programs, fee waivers and rebates on the principal, which may not be accessible to you after you refinance. The rates displayed may include a 0.25% autopay discount.

The information you provide to us is an inquiry to determine whether we or our lenders can make a loan offer that meets your needs. If we or any of our lending partners has an available loan offer for you, you will be invited to submit a loan application to the lender for its review. We do not guarantee that you will receive any loan offers or that your loan application will be approved. Offers are subject to credit approval and are available only to U.S. citizens or permanent residents who meet applicable underwriting requirements. Not all borrowers will receive the lowest rates, which are available to the most qualified borrowers. Participating lenders, rates and terms are subject to change at any time without notice.

To check the rates and terms you qualify for, Splash Financial conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, the lender will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.

Splash Financial and our lending partners reserve the right to modify or discontinue products and benefits at any time without notice. To qualify, a borrower must be a U.S. citizen and meet our lending partner’s underwriting requirements. Lowest rates are reserved for the highest qualified borrowers. This information is current as of Feburary 1, 2021.

2 Important Disclosures for Earnest.

Earnest Disclosures

To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.

Earnest fixed rate loan rates range from 2.98% APR (with Auto Pay) to 5.49% APR (with Auto Pay). Variable rate loan rates range from 1.99% APR (with Auto Pay) to 5.34% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of October 26, 2020, and are subject to change based on market conditions and borrower eligibility.

Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.

The information provided on this page is updated as of 10/26/2020. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at [email protected], or call 888-601-2801 for more information on our student loan refinance product.

© 2020 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.

3 Important Disclosures for CommonBond.

CommonBond Disclosures

Offered terms are subject to change and state law restriction. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900), NMLS Consumer Access. If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown. ‍All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 0.15% effective Jan 1, 2021 and may increase after consummation.

4 Important Disclosures for SoFi.

SoFi Disclosures

  1. Student loan Refinance: Fixed rates from 2.99% APR to 7.33% APR (with AutoPay). Variable rates from 2.25% APR to 6.88% APR (with AutoPay). Interest rates on variable rate loans are capped at either 8.95% or 9.95% depending on term of loan. See APR examples and terms. Lowest variable rate of 2.25% APR assumes current 1 month LIBOR rate of 0.13% plus 2.37% margin minus 0.25% ACH discount. Not all borrowers receive the lowest rate. If approved for a loan, the fixed or variable interest rate offered will depend on your creditworthiness, and the term of the loan and other factors, and will be within the ranges of rates listed above. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. See eligibility details. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. The discount will not reduce the monthly payment; instead, the interest savings are applied to the principal loan balance, which may help pay the loan down faster. Enrolling in autopay is not required to receive a loan from SoFi. *To check the rates and terms you qualify for, SoFi conducts a soft credit inquiry. Unlike hard credit inquiries, soft credit inquiries (or soft credit pulls) do not impact your credit score. Terms and Conditions Apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE.  

5 Important Disclosures for LendKey.

LendKey Disclosures

Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it  endorse,  any educational institution.

Subject to floor rate and may require the automatic payments be made from a checking or savings account with the lender. The rate reduction will be removed and the rate will be increased by 0.25% upon any cancellation or failed collection attempt of the automatic payment and will be suspended during any period of deferment or forbearance. As a result, during the forbearance or suspension period, and/or if the automatic payment is canceled, any increase will take the form of higher payments. The lowest advertised variable APR is only available for loan terms of  5 years and is reserved for applicants with FICO scores of at least 810.

As of 02/17/2021 student loan refinancing rates range from 1.91% APR – 5.25% Variable APR with AutoPay and 2.95% APR – 7.63% Fixed APR with AutoPay.

6 Important Disclosures for Laurel Road.

Laurel Road Disclosures

All credit products are subject to credit approval.

Laurel Road began originating student loans in 2013 and has since helped thousands of professionals with undergraduate and postgraduate degrees consolidate and refinance more than $4 billion in federal and private school loans. Laurel Road also offers a suite of online graduate school loan products and personal loans that help simplify lending through customized technology and personalized service. In April 2019, Laurel Road was acquired by KeyBank, one of the nation’s largest bank-based financial services companies. Laurel Road is a brand of KeyBank National Association offering online lending products in all 50 U.S. states, Washington, D.C., and Puerto Rico. All loans are provided by KeyBank National Association, a nationally chartered bank. Member FDIC. For more information, visit www.laurelroad.com.

As used throughout these Terms & Conditions, the term “Lender” refers to KeyBank National Association and its affiliates, agents, guaranty insurers, investors, assigns, and successors in interest.

  1. Checking your rate with Laurel Road only requires a soft credit pull, which will not affect your credit score. To proceed with an application, a hard credit pull will be required, which may affect your credit score.
  2. Savings vary based on rate and term of your existing and refinanced loan(s). Refinancing to a longer term may lower your monthly payments, but may also increase the total interest paid over the life of the loan. Refinancing to a shorter term may increase your monthly payments, but may lower the total interest paid over the life of the loan. Review your loan documentation for total cost of your refinanced loan.
  3. After loan disbursement, if a borrower documents a qualifying economic hardship, we may agree in our discretion to allow for full or partial forbearance of payments for one or more 3-month time periods (not to exceed 12 months in the aggregate during the term of your loan), provided that we receive acceptable documentation (including updating documentation) of the nature and expected duration of the borrower’s economic hardship. During any period of forbearance interest will continue to accrue. At the end of the forbearance period, any unpaid accrued interest will be capitalized and be added to the remaining principle amount of the loan.
  4. Automatic Payment (“AutoPay”) Discount: if the borrower chooses to make monthly payments automatically from a bank account, the interest rate will decrease by 0.25% and will increase back if the borrower stops making (or we stop accepting) monthly payments automatically from the borrower’s bank account. The 0.25% AutoPay discount will not reduce the monthly payment; instead, the discount is applied to the principal to help pay the loan down faster.

Assumptions: Repayment examples above assume a loan amount of $10,000 with repayment beginning immediately following disbursement. Repayment examples do not include the 0.25% AutoPay Discount.

Annual Percentage Rate (“APR”): This term represents the actual cost of financing to the borrower over the life of the loan expressed as a yearly rate.

Interest Rate: A simple annual rate that is applied to an unpaid balance.

Variable Rates: The current index for variable rate loans is derived from the one-month London Interbank Offered Rate (“LIBOR”) and changes in the LIBOR index may cause your monthly payment to increase. Borrowers who take out a term of 5, 7, or 10 years will have a maximum interest rate of 9%, those who take out a 15 or 20-year variable loan will have a maximum interest rate of 10%.


This information is current as of January 4, 2021. Information and rates are subject to change without notice.