You did all the work of consolidating your student loan debt and getting a job to start paying it back. But, you still have that pesky monthly payment you have to worry about and it’s not cheap.
With the average student leaving college with about $37,172 in student loan debt, you’re looking at a monthly payment of $351. That’s a lot of money to tack onto your already daily living expenses and the thought can be daunting.
Before you get freaked out though, there are a few small changes you could make each month that would have you saving that money in no time. We did some research and found out how real people are cutting costs by giving up a few modern luxuries that equate to $500 or more a month in savings. While some are a bit more extreme than others, just choose a couple of the five tips below and you’ll be paying off that debt without even noticing.
1. Give up cable (and the extras)
Let’s face it; how much TV do you actually watch every day? Is it worth the average monthly cable bill of $103? Probably not.
Cherie Lowe, personal finance blogger at Queen of Free and author of the book “Slaying the Debt Dragon,” suggests getting rid of the pricy TV package and any extras, such as Showtime and HBO, which could save another $5 to $20 a month. Oh, and giving up the DVR could trim $10 or more of your bill.
Instead, opt for a cheaper service like Netflix ($7.99 a month for the basic package) or Amazon Prime ($99 a year) where you can still be entertained without the huge overhead cost. If there’s a show or channel you’re really itching to watch, make plans to watch it with someone who does have cable. Now, you’re not only saving money but socializing more as well.
“Our family went without any TV for a year while paying off debt,” says Lowe who tackled $80,000 worth of student debt. “We checked out DVDs from the library. We shared the experience of the Super Bowl at a friend’s house. It is possible to make it work.”
2. Skip the gym membership
Taking care of your physical health is important, but there’s more ways to do that than in a gym. The average gym membership costs just under $60 a month and won’t necessarily break the bank.
Unfortunately, if you’re more into boutique studios like SoulCycle or membership programs like Class Pass, you’re looking at spending about $34 a class (almost $250 a month if you go three days a week) and up to $135 a month, respectively.
It is possible to bring that cost down to zero without sacrificing your health though. John Schmoll, who runs the blog Frugal Rules, lost 100 pounds and never set foot in a gym. Instead, he walked outside and used free videos on YouTube to slim down and tone up.
Fancy gym equipment isn’t even needed to get in shape. Opt for the local playground where you can do bench dips, step-ups, and pull-ups. Bring a jump rope with you to squeeze in some quality cardio literally anywhere. Or spend some time online finding free videos of everything from yoga and pilates classes to at-home circuit routines.
If you’re really itching to get into a gym class, most studios will offer first-timers a free introductory class.
3. Stop buying books and go to the library
Books, movies, and magazines are all great ways to be entertained and informed, but they can cost a lot of money. The average cost of one adult book can range from just over $15 to almost $30, depending on type (paperback versus hardcover).
If you buy two books a month, you’re looking at over $700 a year on books alone. Add in the costs of extras such as magazines (about $3.50 a month per magazine), and you could be looking at closer to $75 a month in spending.
Get a free library card at your local outpost and that’s instant savings without giving up your favorite entertainment. Most libraries have the latest bestsellers you can check out for free, as well as DVDs, audiobooks, magazines, and more. Some libraries even have tools you can borrow, such as sewing machines and specialized cookware, to help you cut costs on big-ticket items you would only use occasionally.
4. Commit to meal prepping
“Too many of us don’t know what we’re doing for dinner until right before it’s time to eat,” says Lowe. “Meal planning helps you carefully choose food at the grocery store, prevents food waste, and keeps us out of the drive-through. Not to mention, it saved me about $250 a month.”
On average, Americans spend about $10 a meal eating out for lunch. That’s $50 a week if you’re buying lunch every day, which adds up to $200 a month. And that’s just one meal out of three!
Meal prepping — which includes making a list of every meal for the week, picking a shopping day, and spending a few hours chopping vegetables, cooking meats and then freezing them — ensures you don’t feel desperate to eat out or aimlessly buy food at the supermarket.
Don’t know where to begin? Lowe has 10 meal plan options that provide a minimum of six dinners, complete with grocery shopping lists.
“You only have to spend about $50 a week on all of your dining with meal prep,” says Lowe. “If you’re dining out two to three times a week due to a lack of preparation to the tune of $10-20 per experience (or more if your family is larger), you can easily have a meal at home for $5-10.” Instead of spending around $60 on three meals alone, you could have a month of meals for $200 total.
5. Use a cash envelope system
Financial talk-show host and author Dave Ramsey has a lot of opinions on how to save money, but one of his most simple suggestions is to stop relying on your credit card so much and use an envelope instead.
According to research from Avni M. Shah, a professor at the University of Toronto Scarborough, you actually spend less when you pay with cash. Why? Paying in cash “feels the most painful,” Shah told Time magazine.
With this research in mind, Ramsey urged readers on his website to start an envelope system where you mark envelopes with the names of items you can pay cash for — gas, groceries, and clothing. Put the monthly amount of cash budgeted for each category in their envelopes. When an envelope is empty, you can’t spend any more money on that category for the month.
Just cut your spending by the amount you want to save each month (ideally at least $351 to hit that student loan repayment) and don’t put any other unnecessary charges on your credit card. You’ll be well on your way to saving a chunk of change.
As a bonus, take the actual change in coins from your cash purchases and put them in a jar to add to your monthly savings.
Even if you choose just one of these savings tips, you’ll easily be on your way to making a dent in that student loan debt.
Fifty bucks here and there might not seem like a lot, but that’s money you can easily put towards your monthly student loan payment. Add a few of these tips together and you could actually save the equivalent of your entire payment without much of a change in your lifestyle.
Interested in refinancing student loans?Here are the top 6 lenders of 2018!
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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 3.89% APR (with Auto Pay) to 5.87% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 5.87% 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 Month/Day/Year, 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 08/21/18. 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 firstname.lastname@example.org, or call 888-601-2801 for more information on ourstudent loan refinance product.
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2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
Savings example: average savings calculated based on single loans refinanced from 9/2013 to 12/2017 where borrowers’ previous rates were disclosed. Assumes same loan terms for previous and refinanced loans, and payments made to maturity with no prepayments. Actual savings for individual loans vary based on loan balance, interest rates, and other factors.
Application detail: 5 minutes indicates typical time it takes to complete application with applicant information readily available. It does not include time taken to provide underwriting decision or funding of the loan.
Instant rates mean a delivery of personalized rates for those individuals who provide sufficient information to return a rate. For instant rates a soft credit pull will be conducted, 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.
Total savings calculated by aggregating individual average savings across total borrower population from 9/2013 to 12/2017. Individual average savings calculation based on single loans refinanced from 9/2013 to 12/2017 where borrowers’ previous rates were provided. Assumes same loan terms for previous and refinanced loans, and payments made to maturity with no prepayments. Actual savings for individual loans vary based on loan balance, interest rates, and other factors.
3 Important Disclosures for SoFi.
4 Important Disclosures for LendKey.
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.
5 Important Disclosures for CommonBond.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.47% – 6.99%3||Undergrad & Graduate||Visit SoFi|
|2.47% – 5.87%1||Undergrad & Graduate||Visit Earnest|
|2.47% – 8.03%4||Undergrad & Graduate||Visit Lendkey|
|2.95% – 6.37%2||Undergrad & Graduate||Visit Laurel Road|
|2.48% – 6.25%5||Undergrad & Graduate||Visit CommonBond|
|2.72% – 8.32%6||Undergrad & Graduate||Visit Citizens|