Are you being crushed by student loan debt? Most people who went to college recently are in a situation where they have a daunting amount of student loan debt. The average student loan debt today is over $28,000, while the median income is only around $46,000. In a lot of other cases, income is much lower.
Total student loan debt in the United States in 2012 is $966 billion compared to the $507 billion it was in 2006, a 52% increase in only 6 years! The number of those who are having trouble paying these large payments is also on the rise. More than half of those who attend college rely on loans to carry them through and there are about 37 million people today that carry student loan debt from their time in college.
The last thing you want to do is pay the minimum payments on your student loan debt. This can end up adding a payment to your expenses until you are in your 40’s, which is way to long . Not only that, it can make the final cost of your student loan obligations soar after taking into account all of the interest you have paid over the years. This does not even touch on the fact that you could have been investing during this time and earning money for retirement or other needs.
There are several strategies that you can use if you are serious about eliminating this debt:
- Look into federal programs that will forgive the debt if you agree to work in a certain field or area of the country (such as the inner city for teachers). This could lead to no student loan debt remaining in 5-10 years without a payment!
- Live like a college student for a while longer so you are able to take all available resources and attack this loan until it is gone. Don’t rationalize the debt because it may have a lower interest rate or is tax deductible.
- Put a stake in the ground and do not borrow any more money. Once you have done this, look into other options that could potentially reduce the interest rate while you are paying the loan off aggressively.
Student loan debt is a problem in today’s United States. Even so, make it a point to eliminate this debt today.
What plan do you have in place to eliminate your student loan debt?