After you’ve signed on the dotted line, you don’t have to suffer all the way through repaying your student loans.
As a graduate, you’ve probably stumbled across a few . You can’t emerge from your cozy bed at noon and be considered a functional member of society. There’s no school-sponsored taxi to drive you home after you’ve knocked back a few too many at happy hour. And, sadly, your annual income is equivalent to the amount you owe on your student loans. Ouch.
While you really should show up to work on time and limit the number of tequila shots you share with your boss, you don’t have to suffer through your student loans.
1. Do a little sacrificing
The word “sacrifice” doesn’t mean you’re miserable. It simply means you’re trading something of lower value for something more valuable. While you’re still adjusting to adult life, continue to live like a student. Use that ratty bus pass, keep your cheap apartment, eat at home, and watch your bar budget.
2. Work that BA
Student loan debt is something that becomes increasingly less valuable (and, therefore, more expensive) the longer you carry it. The education your loan paid for is obsolete within six months of graduation. Taking 25 years to pay off a loan that hasn’t enhanced your income is like spending 25 years paying off a car that’s stopped running.
To make your degree useful, treat it as leverage. Negotiate for a higher starting salary. If you’ve already started, then leverage your education in your annual review. Ask your employer if he’d pay your student loans in lieu of a raise. Many will consider keeping a valuable employee on by providing loan repayment as a benefit. (For this to actually work, you have to be a rock star. You can’t half-ass it and expect any favors.)
3. Tap Uncle Sam
If you landed a job with the government after graduation, the Office of Personnel Management can help you. A portion of your loans can be paid off by the government, up to $10K per year. (Ahh, that’s where our tax dollars go!)
Even if you don’t work for the feds, they can still help. The federal Income-Based Repayment program allows borrowers to pay loans back according to what’s affordable, rather than what’s owed. The government realizes that engineering majors and ceramics majors don’t make the same income after graduation.
4. Seize tax breaks
You may be eligible to deduct up to $2,500 on the interest you’ve paid on your student loans. The result is a smaller tax bill. Guess where that “extra” money can go? Yep, to your student loans.
5. Get your side hustle on
Find ways to generate income through businesses, online content generation, or affiliate marketing. These methods allow you to earn money while you’re sleeping or working at your full-time job. You can manage more than you can ever do. A second job will suck up whatever free time you have left to achieve your other goals.
Find extra income from prize money, completing surveys, being a secret shopper, completing errands or chores, or spending below “budget.” You can do this by pretending you’re paid twice a month, rather than bi-weekly. Budget for 24 checks, and you’ll have 2 extra checks per year to devote to your loans. Mind games are essential to paying off student loans.
6. Go ahead and make extra payments
Once you find extra money, make additional payments. Whether you can afford an extra $20 or $200, paying down your principal eliminates interest later. (And let’s be honest, an extra $20 now means you’ll get to eat steak sometime this decade.)
7. Be realistic
If it’s easier to structure a settlement that allows you to rid yourself of it once and for all, then pursue it. Make sure any settlement includes a letter stating that you paid on time, as agreed. Ensure that all three credit bureaus get a copy.
Another option is to claim hardship status if things have been difficult for you – divorce, car accident, etc.– so your temporary problems don’t compound into long-term problems. Hardship status can get your debt reduced or eliminated altogether, particularly if you’re dealing with a lengthy illness. Locate the Statement of Financial Status on the Department of Education’s website to get started.
Post-college life is full of hard knocks – but student loan debt doesn’t have to be one of them. Pay your loans off to cut them out of your life. Once you do, you have my permission to toast your achievement with a shot with the boss.
has spent over 11 years as an author, entrepreneur, and venture catalyst and has spent the last 5 years in the investment community incubating media startups as the Managing Partner of TLEC Ventures. He co-authored the international best-selling books, “” (2nd Edition) and “Burnout: How to Transform Frustration to Fortune in 2005.”