Above is an example of just how fun paying off college loans is! Okay, so it's not fun. It's a little frightening, actually. Have no fear! There are ways you can ensure that those scary loans don't come back to bite you.
1) Only Borrow What You Need
It may seem like a good idea to take what ever loan is offered to you, but you have to pay that money back! The less you take, the less you owe.
2) Don't Let Interest Capitalize
Unsubsidized loans accumulate interest even before you graduate. Once those payments are required, that interest turns into principle. Then, interest accrues on that, now larger, principle. In other words, if you don't start paying interest now you'll soon be paying interest on your interest!
3) Start Making Payments Now
If at all possible, start paying off your loan now. Lowering the principle of your loan now will also translate into less interest later.
4) Use Auto Pay Options If Available
Some loans have an auto pay option. If set up, money will automatically transfer from your bank account to pay toward your loan. The benefit of this set up is that this option reduces your interest rate by a percentage. That discounted rate will add up over the years.
5) Don't Pay the Minimum
Pay is much as possible during your monthly payments. The faster you pay off the principle, the less interest you'll pay, and you will be surprised how much money you will say in the long run. It's very possible to save hundreds of dollars this way.
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