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Student Loans Student Loan Repayment

How to Pay Off Student Loans Fast

Paying off student loans is often a marathon, rather than a sprint. You might be surprised to learn that on average, the typical borrower takes 20 years to pay off their loans, with some graduate professionals taking over 45 years to clear their education debt. 

Taking longer to repay student loans can mean paying more interest in total, and debt may be a roadblock to achieving other financial goals. While a borrower may not intend to spend decades paying off student debt, it can and does happen for various reasons. 

If you’re interested in how to pay off student loans faster, there are things you can do to trim months or even years off your repayment term. We’ll walk you through twelve strategies for accelerating your student loan payoff, whether you owe federal loans, private loans, or a mix of both. 

How long does it take to pay off student loans?

The average time to repay undergraduate loans, specifically federal loans, is 20 years. If you took out additional loans for graduate school or a professional degree, then your repayment period can more than double. Private student loan repayment times are more difficult to track, as repayment terms aren’t standardized the way they are for federal loans. 

The Standard Repayment Plan for federal student loans has borrowers pay off their loans over 10 years. So why might it take some borrowers much longer to clear their loans? There are a few reasons and it often depends on the borrower’s situation. 

Here are some things to know about student loan repayment: 

  • Opting for deferment or forbearance can temporarily suspend payments but it extends your loan payoff debt. 
  • Enrolling in an income-driven repayment plan can extend repayment from 10 years to 20 or 25 years. 
  • Taking on additional loans for graduate school can leave you with more debt to repay.
  • Choosing a longer repayment term for private student loans can lower your monthly payments but leave you indebted for longer. 

If you’re considering how to pay off student loans faster, it helps to know the details of your loans first. Specifically, that includes whether you have federal or private loans, repayment terms, and interest rates. Those details can give you a framework for deciding if it’s feasible to pay off student loans faster based on your budget. 

Also, remember that the goal is a little different if you’re interested in public service loan forgiveness. Instead of trying to pay your loans off as quickly as possible, you’d enroll in an income-driven repayment plan and make the 120 qualifying payments that are required. 

How to pay off student loans fast: 12 options

If you’re eager to start paying off your student loans, explore these 12 techniques to find the best way to pay off student loans for you:

Create a budget. Then, prioritize loans with the highest interest rates and pay more than the minimum. Generally, consolidating federal loans into private loans is not the best idea.

Jim McCarthy


Repayment strategyHow it worksPros/consWhat you need to know
Pay more than the minimumPaying more than the minimum to student loans or any debt can reduce your balance faster. Pro: You could significantly cut down your payoff time. 

Con: This might not be an option if you’re on a tight budget.
You’ll need to ask your lender or loan servicer to apply any extra amounts to the principal only; otherwise, it may go to fees and interest instead.
Refinance your student loansRefinancing into a shorter loan term can reduce your payoff time, while a lower interest rate can help you pay off debt faster if more of your payment goes to the principal.Pro: You could save a lot of time and money by refinancing student loans.

Con: You may need a cosigner to get approved for a refinance loan at favorable rates.
Refinancing federal student loans into private student loans will cause you to lose all federal loan protections and eligibility for public service loan forgiveness. 
Make biweekly paymentsMaking biweekly payments adds up to one extra full payment per year, which can get you out of debt faster. Pro: Making even one extra monthly payment yearly can get you out of debt faster. 

Con: Splitting up monthly payments into biweekly payments could add a wrinkle to your budgeting system, depending on how often you get paid. 
Biweekly payments may not save you that much more in interest than monthly payments. 
Pay off high-interest loans firstPaying off loans with the highest interest rates first can save you more on interest and potentially free up money in your budget that you could redirect to other loan debt.Pro: Your interest savings could be significant. 

Con: This strategy may not benefit you much if all of your loans have higher rates. 
If you have multiple loans that all have high-interest rates, you might benefit more from refinancing into a single, lower-rate loan instead. 
Take advantage of interest rate reductionsEven a slight reduction of your interest rate means more of your payment goes to the principal, which can speed up your repayment time. Pro: An interest-rate deduction is essentially a discount on your loans.

Con: You’ll need to be comfortable with enrolling in automatic payments to qualify in most cases. 
Private student loan lenders may offer multiple ways to get rate discounts, other than auto pay. For example, you may be able to qualify for an additional discount if you open a checking or savings account with the bank that holds your loans. 
Create a budgetCreating a budget can help you commit to the debt repayment process since you’re holding yourself accountable for where your money goes each month. Pro: Keeping a budget can help you get out of debt faster while balancing other financial goals, like saving and investing. 

Con: Budgeting alone may not be enough to pay off student loans faster. 
Choosing the right budgeting tools and/or method can make it easier to stick with your plan. 
Work for an employer with repayment assistanceRepayment assistance can help you pay off student loans faster if your employer is matching your payments dollar-for-dollar or paying your loans for you.Pro: Having your employer chip in to pay off student loans can help you clear your debt faster without anything extra out of pocket.

Con: It may be difficult to find an employer in your field that offers repayment assistance. 
If your employer offers repayment assistance, get the details on how it works. For example, will you receive a lump-sum amount as reimbursement or will they match any payments you make to your loans? 
Avoid extended repayment termsSticking with a shorter repayment term means you’re not drawing out your loan payoff. Pro: You won’t get into a situation where you’re taking decades to pay off debt and costing yourself more in interest. 

Con: An extended repayment term is a requirement for getting loan forgiveness. 
If you’re considering a longer repayment term, calculate your estimated monthly payments. Then, calculate the interest to see how much it would cost you to take more time to pay off your loans. 
Use tax deductionsTax deductions can put money back into your bank account that you can use to pay off debt. Pro: You don’t have to itemize deductions on your tax return to write off student loan interest. 

Con: There’s an income limit for claiming the student loan interest deduction. 
You may qualify for tax deductions and tax credits for eligible education expenses, but you can only claim one or the other for the same expenses, not both. 
Make lump-sum paymentsLump-sum payments can knock out a chunk of your student loan debt in one go. Pro: A lump-sum payment could reduce your loan balance very quickly. 

Con: Drawing from savings to make lump-sum payments to your loans could leave you short on cash if an emergency comes along. 
You’ll need to make sure the payment is applied to the principal only.
Use loan forgiveness programsLoan forgiveness can help you get out of student debt without paying the entire amount that you owe. Pro: There are different ways to get forgiveness for federal student loans.

Con: This isn’t an option for private loans. 
If you’re considering public service loan forgiveness, you’ll need to make sure you’re making qualifying payments to be eligible. 
Join the militaryThe U.S. military offers student loan repayment benefits to eligible service members.Pro: Military loan repayment could significantly reduce what you owe and your debt repayment time. 

Con: You’ll need to meet program requirements to qualify and private loans aren’t eligible. 
Joining the military is a serious undertaking and you’ll need to be sure you’re comfortable with what it entails, which can include a minimum service commitment. 

1) Pay more than the minimum

Paying more than the minimum and putting the extra money toward reducing your principal balance is a fast way to become debt-free. This strategy lowers the remaining amount due and, because interest is calculated on your remaining balance, reduces the total interest owed.

How it works

Here’s an example of how paying more than the minimum can shorten student loan repayment. Assume you owe $30,000 at a 6% interest rate with a 10-year repayment period. 

Monthly paymentPayoff timeInterest paid
$333120 months$9,967
$43385 months$6,899
$53366 months$5,296

As you can see, a monthly payment of $200 extra can cut your payoff time nearly in half. You’d also save over $4,600 in interest. 

What you need to know

Setting up automatic monthly payments for more than the minimum ensures you always pay a little extra. Enrolling in autopay might give you an additional benefit through an interest rate discount. 

Just be sure your lender applies your payment to your principal rather than advancing your due date.

2) Refinance your student loans

Refinancing involves getting a new loan at a lower interest rate. If you keep payments the same or increase them but reduce your interest rate, you’ll pay less in interest in the long term. And more of your payment will go toward reducing the principal balance with student loan refinancing.

How it works

Once again, assume you have $30,000 in loans at 6% interest with a 10-year repayment term. You refinance to a new loan at 5%.

Here’s what your monthly payment, payoff time, and interest paid would look like with different repayment terms. 

Monthly paymentPayoff timeInterest paid
$318120 months$8,184
$38096 months$6,461
$48372 months$4,787

Choosing a shorter repayment term would get you out of debt at the fastest pace and save you the most money in interest. However, it would mean a higher monthly payment. 

What you need to know

You give up important protections on federal student loans by refinancing, such as the ability to use an income-driven repayment plan, and you need to qualify for a new loan based on your income and credit score. You might need a cosigner for approval if you have less than perfect credit or no credit. 

If you want to learn more about refinancing, you can check out our guide to the best places to refinance student loans.

3) Make biweekly payments

Instead of paying your loan monthly when the payment is due, you can divide your required payment in two and pay it every two weeks.

How it works

Biweekly payments may not save you a lot of money on interest, but they can help you pay off your loans faster. 

Here’s an example of how biweekly payments might affect your repayment of $30,000 in student loans at 6%. 

Monthly paymentPayoff timeInterest paid
$333120 months$9,967
$167 biweekly108 months$8,967

Essentially, you’d get out of debt one full year faster just by making this small change in how you pay. 

What you need to know

This little trick helps you pay off your student loans faster because you will end up making 26 half payments, which amounts to 13 months’ worth of payments instead of the 12 you would have paid with once-a-month payments. 

4) Pay off high-interest loans first

Some of your student loans may charge interest at a higher rate than others. If you can pay those more expensive loans with higher interest rates first, you’ll save more on your total interest.

How it works

Assume the $30,000 you owe is split between three loans. You have a $20,000 loan at 5%, a $10,000 loan at 9%. Here’s how much interest you’d pay with each one, assuming a 10-year repayment period:

  • Loan A for $20,000 would cost you $5,455, with a $212 monthly payment
  • Loan B for $10,000 would cost you $5,201, with a $126 monthly payment

Even if the second loan is half the amount of the first, you’re still paying almost the same amount in interest. Throwing everything you have at the second loan could help you pay it off faster while saving money. 

For example, doubling the monthly payment would knock six years off the repayment time and save over $3,000 in interest. 

What you need to know

While you’ll need to pay the minimum on every loan, putting any extra cash toward your highest-interest loans first helps pay them down faster. 

That leaves loans with lower interest rates to accrue interest for a longer period than those with the highest rates. If all of your loans have higher rates, refinancing could help bring them down. 

>> Read more: Which student loans to pay off first

5) Take advantage of interest-rate reductions

Many student loan servicers provide a deduction on interest if you set up autopay. Some also reduce interest after you’ve made a certain number of on-time payments.

How it works

The most common interest rate reduction is a 0.25% reduction for enrolling in automatic payments. So how much is that really worth? 

Here’s another example to illustrate your projected money and time savings. 

Loan termsMonthly paymentPayoff timeInterest paid
$30,000 at 6%$333120 months$9,967
$30,000 at 5.75% with autopay discount$329120 months$9,516

This strategy assumes you’re following a standard 10-year repayment plan. However, if you were pairing rate discounts with other extra principal-only payments or biweekly payments, you could get out of debt much sooner. 

What you need to know

Interest rate reduction programs vary among lenders, so find out your options for getting your lender to reduce your rate. And remember, even a slight interest rate reduction can make a big difference if you’re dealing with $100K in student loan debt.

6) Create a budget

With a budget that includes student loan repayment, you’ll be more mindful of where your money goes and can plan to put more money toward paying off student loans early so you can eliminate debt faster.

How it works

To create a budget, track your spending to see where you’re going overboard. Budget for necessities first, such as rent and food. Then work money into the budget for extra student loan payments before allocating for your wants.

If you have irregular income, you may want to create a baseline budget that covers your bare minimum expenses. You can use an average of your monthly income for the past six to 12 months to figure out how much you realistically have to commit to student loan repayment. 

What you need to know

Budgets are only effective when you’re sticking with them. If you’re not checking in with your budget regularly, you could be setting yourself up for failure regarding loan repayment. For help following a budget, consider using a student loan app.

7) Work for an employer with repayment assistance

Employer student loan repayment assistance is growing in popularity as a workplace benefit. The type of benefits you can take advantage of can vary, depending on what your company offers. 

How it works

There are different ways that employers can offer student loan repayment assistance, including:

  • Signing bonus. If your employer offers a signing bonus for student loans, you’d get a lump sum when you start your job that you could apply to your loans. 
  • Recurring direct payments. Some employers make direct payments to loans on behalf of eligible employees. Payments may occur monthly or annually. 
  • Retirement savings incentive. To encourage employees to enroll in workplace retirement plans, some employers may offer a benefit arrangement that can help you pay down your loans faster. 
  • Vacation time swap. Companies may also allow employees to cash in their accrued vacation time and apply the amount to their loan balances. 

What you need to know

When you work for a company that offers this benefit, keep paying the minimums yourself and use the extra funds from your employer to pay down the balance faster.

8) Avoid extended repayment terms

Many federal student loan repayment options, including income-based plans, extend the time to pay off your loan. Instead of a 10-year term, for instance, you may have 20 to 25 years to pay off your loans. 

How it works

Choosing a longer repayment term can lower your monthly payment but add to your interest paid. Here’s another example showing the anticipated cost of a longer repayment term. 

Loan termsMonthly paymentPayoff timeInterest paid
$30,000 at 6%$333120 months$9,967
$30,000 at 6%$215240 months$21,583.04
$30,000 at 6%$193300 months$27,987.13

As you see here, a longer repayment term can mean less out of pocket to pay each month. But it can skyrocket the total amount of interest you’ll pay. 

What you need to know

Extended repayment can make your monthly payment lower and help in times of financial hardship. Choosing a longer term with an income-driven plan is also a requirement for public service loan forgiveness. 

However, avoiding extended plans is best if your goal is to pay off your loans faster. You’ll pay more in interest when you stretch out your repayment period, and it will take years longer to become debt free than if you stuck with the standard plan.

9) Use tax deductions

For most student loan borrowers, you can take a tax deduction of up to $2,500 per year for student loan interest. When you take this student loan interest tax deduction based on the actual amount of interest you pay, it reduces your adjusted gross income (AGI), so you pay less in taxes.

How it works

The student loan interest deduction is an above-the-line deduction, meaning you don’t need to itemize on your tax return to claim it. Each January, your lender or loan servicer should send you a Form 1098-E showing how much interest you’ve paid. You’ll use this to claim the deduction on your taxes. 

What you need to know

If your income exceeds $75,000 as an individual or $155,000 if you are married filing jointly, you lose part of the deduction. You lose the full deduction if you make at least $90,000 as an individual or $185,000 if married filing jointly.

10) Use extra cash to make lump-sum payments

A LendEDU survey found that more than half of student borrowers who pay off their student loans in one to five years made at least one lump-sum payment of $5,000 or more, making this one of the best strategies for paying off student loans fast.

How it works

When you come into extra money—for example, from a tax refund—you can apply the funds to your student debt in one single payment or several smaller payments. This will reduce the principal balance you owe if you ask your lender to apply it to the principal rather than the interest and fees. 

For example, say you have $30,000 in student loans at 6%. You come into a $12,000 windfall from an inheritance which you decide to put toward your debt. You’d cut your repayment time by nearly five years and trim nearly $7,000 off the interest. 

What you need to know

Certain types of lump sum payments you receive may be taxable to you. For example, if your employer hands out a $5,000 bonus to you and your coworkers at the end of the year, that money would be treated as supplemental wages and be subject to tax. 

11) Use loan forgiveness programs

Student loan forgiveness allows you to get part of your debt canceled, typically after making a certain number of payments or meeting other eligibility requirements. 

How it works

If you work in a qualifying public service job, you may be able to get your debt forgiven after you make 120 on-time payments. After about 10 years, you can have your remaining balance forgiven, which allows you to become debt-free much faster. 

You’ll need to enroll in income-driven repayment to qualify, but that could reduce your payments to $0, depending on how much you earn. As long as you’re employed by a qualifying employer any $0 payments would still count toward your 120-payment total. 

What you need to know

Public Service Loan Forgiveness has strict criteria, so know the rules if you want the government to forgive part of your debt. You may be eligible for other student loan forgiveness programs, too; just be sure to read the fine print before pursuing one of these options.

12) Join the military

If you join the military with student loan debt, you may be able to pay it off using the GI Bill or another form of relief, such as military student loan forgiveness.

How it works

There are different ways to get student loan relief from the military. Your options might include:

  • Qualifying for public service loan forgiveness
  • Department of Defense (DoD) loan repayment
  • Student loan discharge for disability

Military members can also qualify for interest rate reductions and rate caps, as well as special deferment periods. 

What you need to know

You’ll often need to commit to a certain number of years in the active military to get help with your debt. Loan repayment assistance may require you to forgo your G.I. Bill benefits. Research programs to find out requirements and explore your options.

What is the best way to pay off student loans faster?

The best strategy for how to pay off student loans fast is the one that fits your budget and timeline for becoming debt-free. For instance, that might mean a combination of:

  • Paying more than the minimums
  • Enrolling in automatic payments
  • Paying biweekly
  • Applying tax refunds to your loan balance

Certain options, like public service loan forgiveness or military loan forgiveness, have a narrower scope and won’t work for everyone. The same is true of employer student loan repayment assistance. 

Evaluating your budget and financial situation can help you decide which of the above methods you can apply. You may also find it helpful to estimate your monthly payments and interest savings with some of the different options using a student loan calculator. 

Break your budget into “must-haves” or needs versus “nice-to-haves” or wants. Look to reduce, suspend, or eliminate items in the “nice-to-have” category to create extra cash to pay off loans.

Jim McCarthy


Additional resources

Here are additional resources for those looking to speed up the time it takes to pay off their loans: