According to Debt.Org, the total owed by students in the United States is 1.2 trillion. The total U. S. Student Debt has grown substantially large over the years. The college students of today are graduating without jobs but rather with a mountain of debt. The average student borrower graduating in 2016 is expected to carry more than $40,000 in student debt. Combine this with the knowledge that in addition to the student loan debt, more and more graduates are also taking on credit card debt and mortgages as well.

When attempting to manage any sort of debt, specifically student loans, putting together some action steps is going to help you tremendously in the long term. So what are some good tips to help graduates be able to manage their debt? Let’s go over 3 steps you or a student borrower can take to help manage student loan debt in 2016.

Schedule Automatic Payments

You are going to want to setup your automatic payments as soon as possible. You can do this through your bank or you can inquire with your student loan company how to best set these up. Many banks, such as Wells Fargo, offer the ability to schedule automatic payments for free. You can configure it so that your bank automatically mails a check to your loan company each month on the exact date you specify. This is beneficial to you because the loan company does not have direct access to your bank account.

When you setup these auto payments for your student loan debt, a couple of factors are going to work in your favor. First, by setting up these payments, you are giving yourself peace of mind that you will never miss a payment. Second, many loan companies are offering a discount on your interest whenever you schedule automatic payments from your bank account.

Make Extra Payments

So, the U.S. Department of Education states that most companies are going to want their borrowers to pay at least one payment per month. If you have taken our advice and already scheduled auto payments, you have taken the first step towards ensuring that you don’t miss any payments and thus, will not incur any further late fees or additional interest being added to your student loan.

But, what you might want to start doing in addition to that scheduled auto-pay, is to consider adding additional payments within the month. So, there are a couple of benefits that will again work in your favor by utilizing this strategy. First, the most obvious is that you will cut down on your student loan bill much faster by doubling up on your monthly and paying bi-weekly. Also, in addition, by paying bi-weekly versus monthly, it actually adds up to 13 months payments in a calendar year instead of 12. So you are giving yourself an extra month of payment every year.

Consider Refinancing

You have been paying on your student loan every month on time and have been using the auto pay function and have even been using the bi-weekly strategy to really knock down your principal as well as the interest on the overall loan. Now what?

Well, have you considered refinancing? Perhaps you were not aware that federal loans can actually be refinanced depending on what bank you choose. See, by the time you graduate and have been making monthly payments on time, you may have incurred a higher credit score. Over time, by making your student loan payment and your mortgage and car payment every month, it may be time to renegotiate that interest rate that you received when you graduated.

We have discovered that utilizing these 3 strategies: Schedule automatic payments, Make extra payments, and consider refinancing your federal loan can help to reduce and manage your student loan debt in 2016 and beyond.

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