If you have student loan debt as a recent nursing school graduate or if you’ve been in the field for years and have been paying the minimum payments on your loan, it’s a good idea to consider ramping up your payments.
You may have to sacrifice your lifestyle for a while to pay off your loans fast, but it will be worth it. Freeing up the monthly payment will allow you to use those funds for other goals such as saving up to start an advanced degree program or put you in a more stable financial position for large purchases such as buying a house.
Below are some practical steps you can take that will make a huge dent in your student loan.
1. Avoid Lifestyle Inflation
Once you graduate from nursing school and enter the repayment period on your loan, avoid lifestyle inflation. Instead, continue to live like you’re still in college. While it’s tempting to increase your lifestyle after you start making a full-time nursing income by getting a nicer home and new car, avoiding these lifestyle upgrades and instead focusing on paying off your loans will set you up for long-term financial success.
2. Cut Expenses
If you have been in the workforce a while, try cutting skimming the fat from your budget and redirecting those funds towards your loan repayment. Budget items for cable TV, cell phone plans, the latest tech gadget and eating out are all great categories to look at squeezing extra money from each month.
3. Work Overtime
Nurses work in a field where there is often a shortage of qualified professionals to fill the needs of patients. If overtime is offered by your employer, take it with the goal of using the extra money to pay off your loans. If no overtime is available, consider taking a second job until your loan is paid off.
4. Stay Focused
Paying off a student loan is often a longer-term goal, so it’s important to stay motivated and focused. Have a target date in mind for when you’ll pay off your loan and set some exciting life goals that you can begin working on after they’re paid. Try using an online debt calculator to create an optimized debt repayment plan to help minimize interest and keep you motivated throughout the process.
If you follow these tips, you will cut down the repayment period of your loan substantially. Just by delaying some lifestyle upgrades or cutting back your discretionary expenses for a few years, you’ll set yourself up for financial success for the rest of your career.