Lifestyle changes are scary but necessary for growth and independence. As a new grad, it’s important to consider changing your lifestyle in order to accommodate debt repayment and gaining better control of your finances.
Here are six lifestyle changes you can implement to get you on the right path for paying off your student loans.
1. Create a system for your money
Creating a system for your money is a simple but effective way to stay on top of your finances.
Are you a saver or spender? Knowing how to deal with your spending habits is an important part of successfully managing your money, but that’s not all.
Automating your money will help you avoid making mistakes, like overdrawing your checking account or paying a credit card bill late. Not staying on top of your finances can damage your credit, which can reflect poorly on you when you’re looking to refinance your student loans.
Consider setting up reminders so you won’t forget to make payments, or sign up for automatic bill pay whenever you can. Or use a free online bill payment service to pay your bills on time every month.
You can also link a savings account to your checking account so you won’t be in danger of overdraft charges.
2. Reduce your housing costs
According to a July 2016 study from Apartment List, apartment rental costs fell slightly nationwide.
However, some cities have housing costs that are on the rise, so it’s important to do your research before choosing where to live after graduation. You should also think about choosing a city based on career opportunities available.
The monthly rent for a 2-bedroom apartment in the U.S. currently hovers around $1,300, while a 1-bedroom apartment averages $1,100.
Consider different lifestyle changes and scenarios for how you can save money if you decide to relocate, such as:
- living with a roommate
- downsizing and living in a smaller space
- moving to a city with a lower-than-average cost of rent
- renting out your couch or spare room on the weekends
- extending your commute in order to pay less on housing
3. Move to a walkable city
Owning and maintaining a car is one of the largest household expenses in the U.S.
One way to reduce this expense is by moving to a walkable city with close proximity to entertainment, shops, stores and easy access to public transit.
In addition to tangible savings, you’ll also be healthier and happier in a city where you can walk or bike to activities. In other words, moving to a walkable city can save you a lot more money than just the cost of gas.
4. Foster a side business
Another way to prepare for major lifestyle changes is by starting a side hustle, or a job that earns additional income on the side of your regular day job.
This can be anything from a weekend job you find on Craigslist to something more regular, like delivering groceries on your days off. There are plenty of jobs that pay $16 an hour or more.
Not only will starting a side business help you earn extra money to pay off your student loans, it will help you become familiar with a new city, make new friends and gain new skills. T
5. Build up your social network
When I made a cross-country move from Dallas, TX to Denver, CO I never realized how starved my social life was for like-minded peers and social events. Ever since I came to Denver my network has exploded in less than 6 months thanks to Denver’s up-and-coming tech hub for young professionals.
Hanging out with like-minded peers and making new friends has brought in countless opportunities, jobs, and connections to big companies that I never had in the past. Don’t discount the importance of social networking events where you can meet new people or connect with like-minded peers.
6. Review your loans and bills
Major lifestyle changes are a good catalyst for revising your bills and loans to see where you stand. You may even be able to lower them.
As you move on from one phase of your life to the next you’ll most likely have different expenses to consider. You may have to start researching health insurance options, or if you move to a new state you may have to get new car insurance.
Can you negotiate a lower rate by joining an organization or signing up for automatic bill payment? Most companies are open to reducing your interest rate, or monthly utility bill if you simply sign up for automatic payments. It never hurts to do the research and ask what your options are.
Making these preparations for major lifestyle changes can help you save money on living costs. This will help you aggressively pay down your debt and achieve your financial goals as you move into the next phase of your life.
Interested in refinancing student loans?Here are the top 6 lenders of 2020!
|Lender||Variable APR||Eligible Degrees|
|1.99% – 5.64%1||Undergrad & Graduate|
|1.89% – 5.90%2||Undergrad & Graduate|
|2.25% – 6.28%3||Undergrad & Graduate|
|1.89% – 6.77%4||Undergrad & Graduate|
|2.39% – 6.01%||Undergrad |
|1.99% – 5.61%5||Undergrad & Graduate|
|Check out the testimonials and our in-depth reviews! |
1 Important Disclosures for Earnest.
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 5.79% APR (with Auto Pay). Variable rate loan rates range from 1.99% APR (with Auto Pay) to 5.64% 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 July 31, 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 7/31/2020. 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.
2 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.
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%.
KEYBANK NATIONAL ASSOCIATION RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE.
This information is current as of September 9, 2020. Information and rates are subject to change without notice.
3 Important Disclosures for SoFi.
4 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 September 10, 2020.
5 Important Disclosures for CommonBond.
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 0.16% effective Sep 1, 2020 and may increase after consummation.