How Far Would You Go To Get Rid Of Student Loan Debt?

A colleague of mine recently shared this article titled “How Far Would You Go to Get Rid of Your Student Debt?” that focused on the extreme lengths many people were willing to go to get rid of their student loans. It’s not surprising when you consider that the average college student graduated this year with over $35k in loans. If they pay just the 4.66% interest rate on federal student loans for undergrads, they’ll pay almost $9k in interest by the time they pay it off in 10 years. But if they can put an extra $300 a month towards their debt, they’ll pay it off in under 5 years and save more than half the interest. They can then put those payments towards buying a home or becoming financially independent.

Unfortunately, I noticed that the only option that a majority of people were actually willing to do was the only one not available to them: turn their life into a reality show. That doesn’t mean you need take the other extreme options in the article of selling an organ, selling half your possessions, taking part in a questionable health study, or signing up for active duty military service to pay off your debt. Here are some other options that can save or earn you hundreds of dollars: (I’ll let you decide which are too “extreme.”)

Housing

This is most people’s biggest single expense. I know when I first graduated from college, I lived with my grandmother for a couple months before starting my new job and then I moved into an apartment with a friend from college. Downsizing to a less expensive place or moving in with a roommate or two can be harder once you’ve gotten used to having more space or amenities or living on your own but it’s a great way to save A LOT of money.

Don’t want to give up your home? If you have an extra bedroom, consider renting it out on Craig’s List or for shorter stays, on sites like AirBnB. Longer term roommates can share other costs and household chores as well while shorter term stays tend to earn you more per day but require more work on your part.

Transportation

Drive an older car or even none at all. My current 20-yr old car admittedly has some cosmetic issues but it still gets me from point A to point B as well as a new car would. It also costs a lot less to insure than a newer, more expensive car. If you want to save even more money, ride sharing services like Lyft and Uber make going car-less cheaper and more convenient than ever.

If you want to keep your car, you can put it to work by becoming  a driver for one or both of those ride sharing services. Most drivers I’ve spoken with are either entrepreneurs or professionals looking to make a few bucks on the side. You can work when you want so it’s very flexible and can even be fun.

Other bills

Cancel any memberships or subscriptions you don’t really need or use. Using energy-efficient light bulbs and appliances can often save you money in the long run. Many people I know have replaced their landline phone with their cell phone and their cable TV with an antenna for local channels and/or online streaming services like Netflix, Hulu, Amazon, iTunes, and Google Play that actually give them MORE control over what and when they watch with little or no commercials. You can also save money on your cell phone bill by switching to a prepaid cell phone plan.

Don’t want to change your services? BillCutterz will try to get you lower costs without changing any of your services in exchange for half of whatever they save you. Want to keep all the savings to yourself? See if you qualify for any discounts with them or try negotiating down your rates.

Food, Shopping, and Entertainment

You can set your alarm clock a little earlier in the morning to make your coffee and lunch at home and bring snacks rather than buying them all at work. Consider hosting dinner parties or potlucks rather than always dining out with friends. Watch movies through Redbox, online movie sites, the local library, or a matinee instead of always paying full price at the theater (or at least avoid the concession stand). “Pre-game” with drinks at home before going out on the weekends. Sign up for discount cards, look for sales, use coupons, and/or buy in bulk to save money on groceries and other shopping

If you’re having trouble cutting back on these areas, you might want to give yourself a fixed monthly or weekly allowance in cash or a separate back account that you can spend on these discretionary expenses. The key is that when the money is gone, you can’t spend more until the next month or week. This gives you flexibility to spend without going over your budget.

Just like with the examples in the article, some of these options may seem ridiculous to you but feasible to others and vice versa. Everyone is different. The one thing we should all agree with is not wanting to pay high interest rates on debt so how far would YOU go to get rid of it?

 

 

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