I may earn money or products from the companies mentioned in this post.
Paying off debt can be a huge pain in the ass. Graduating from school with thousands or even hundreds of thousands of dollars can really suck. It can be really intimidating at first when you look at your outstanding loans, whether it be from college, graduate school or wherever.
Somehow a lot of my friends are studying to either be pharmacists or doctors, so I've heard firsthand how much they have in student loans to pay back when they get a job. One of my buddies literally has $1 million in loans. He hasn't even started his residency yet. Granted, he's studying to be a doctor in a field where the average starting salary is $300,000, but still, I mean that's a boatload of student loans, I don't care how much you make.
- Create a Blog with SiteGround
- How Changing the Student Loan Payment Plan and Refinancing with SoFi Saved My Girlfriend Over 5 Years and Thousands of Dollars
- How to Know if Loan Consolidation is Right for You
- Make $11,520 Extra This Year Playing With Cats
- 10 Ways to Make Money from the Comfort of Your Home This Week
- 5 Ways to Make Extra Money This Week
Whether you have $5,000 or $1 million in loans, there are several ways to improve your situation to pay the debt back sooner. There is always a solution, it's just sometimes you might have to be a little more creative! It can even be fun sometimes and pretty satisfying taking in checks on a monthly basis from putting in a little extra work while you're working to pay off your debt.
Here are 18 ways to pay off your debt faster:
Create a side hustle:
Obviously, this is my favorite one. Below are some of the ways you can make a little extra cash for yourself:
- Look at all of these blogs that create a steady monthly income
- The amount of work you need to put in starting up your blog can be a lot, but once you have everything in place and get in a rhythm, depending on what you want to do, you don't need to put in as much time as other side hustles
- All you really need is a good story and network with other bloggers and editors at sites specific to your niche
- For example, JP Livingston says she puts in around just 5 hours a week but makes over $60,000 in a year; She's been featured in Forbes, CNN, Business Insider and CNBC because she has an amazing story of retiring at the age of 28 with $2 million
- Find your story and get it out there
- On Glassdoor, the average salary for a part-time bartender as of this writing is $18,071
- That's pretty good, I was going to try to be a part-time bartender while I was looking for my first job, but then I got one, so I never ended up doing it
- But I thought it would be cool to learn how to make drinks for when I have friends come over to my future apartment! Which is now, and I don't know how to make many..womp.
- This is also a very lucrative side hustle in case you've been living under a rock and don't know
- Let's be real, those babysitters aren't paying any income tax on that cash
- Depending on the area you live in, I know some people when I was in high school who would get $40/hr for a 3 hour night
- That's such easy money all you do is make sure the kids eat if they haven't, put them to bed and watch TV until the parents get home
- You can make up to $11,520 literally playing and chillin' with cats
- Most of the time cats and dogs are much nicer than people, so that's fun
- Especially in cities, there are definitely opportunities to snag a few bucks to pay your loans off quicker
Give sports lessons
- When I was in high school I got paid literally $60/hour
- It was easier than taking candy from a baby
- Nobody cried, and the parents basically begged me to take their kids off their hands for a couple of hours
- All I really did was have them dribble the ball around and shoot it in the net a bunch of times; world-class training right there
Be an Uber/Lyft driver
- The average hourly wage for an Uber drive is $15.68 while the hourly wage for a Lyft driver is reportedly $17.50
- That adds up to $6,522/year for 8 hours on a weekend, and $32,610 in 5 years for Uber and $7,280/year for 8 hours on the weekend, and $36,400 in 5 years for Lyft
- I also see plenty of drivers signed up for both to increase their chances, so that's also a good strategy
- There are several companies online that allow you to make some extra cash for giving them your input through surveys
- Here is a list I found that won't take up a lot of your time in return for some money
Debt snowball method
- This is only if you haven't consolidated your loans
- Psychologically, this can be a huge confidence boost for you
- By paying off the smaller loans relatively quickly, you'll start to see you can really pay everything off
- In some cases even sooner than you realized!
- Before you know it, you're on your way to paying off your second, third, fourth loan and then you're finally debt free after your hard work of keeping the course
Look at monthly payments
- It can be motivating knowing the extra money you have set aside is being used to pay off your loans
- When you look at the big picture, it can feel really good
- For example, my girlfriend changed her minimum payment each month from $1,000 to $4,000
- Yea that's 4 times as much, but it just seems like $3,000 more
- But when you look at it through a 12-month frame, that's $48,000 vs $12,000!
- That's a $36,000 difference, that's nice man
Use your extra checks you get from your job for your monthly loan payments
- If you get paid every 2 weeks out of 52, there are 26 pay periods in a year; there are 24 two-week periods (2 per month), so you'll essentially be getting an extra check in two of those months compared to the frequency you need to pay your loans
- That means you'll be getting 3 checks instead of 2 checks in a month twice throughout the calendar year
- Put those 2 extra checks a month towards your loan payment
- Don't think of it in terms as them already being part of your salary
- Think of it like you get paid twice a month, but instead for these two months you get paid an extra time that you don't account for 10 months of the year to pay for everyday expenses
- You should really put it towards your loan payment, you'll feel better
If you get bonuses or commission, put that towards your loans
- It's the same idea, extra money should be put towards your loans
- My girlfriend is planning on putting all of her bonus into her monthly payment to get it over with as soon as possible
- It might not seem like much, but when you make extra payments through bonuses, extra pay periods, extra cash from side hustles and add them all up, it makes a big difference
Put your salary increase towards your loans
- You were able to live on the salary you just had before you got a raise, so why not put the extra money towards your loans?
- You won't notice the difference and you'll be paying them off sooner!
- It's a win-win if you ask me
Move back home for a little if you can
- Time will fly, and you might think you're wasting your years living at home instead of being on your own in your twenties, but trust me, it really, really helps
- I felt the same way when all my friends moved out of our hometown
- I thought I was missing out on all the time to finally be on my own the first 3 years or so, but then I realized I just had to get through a couple more years of saving and wait for my girlfriend to graduate pharmacy school (which was in the next town over) and I'd be in amazing shape
- The funny thing is, once I moved out, a bunch of my friends began moving back home because they hadn't saved anything and were living in Manhattan
- It was nuts, there was no way they were able to afford it without have to buy Bud Light every single time they drank, like that's miserable man we're not in college anymore, come on!
Sell some of your stuff
- I read somewhere, I forget where exactly, that there's on average $3,000 worth of items people could sell online that they don't need or use anymore in their home
- That's a whole lot of money for stuff you don't use!
Practice mindfulness and read some books on it
- This sounds super cheesy, but I promise it actually helps
- I read The Obstacle is the Way, Mindfulness for Beginners and Mindfulness in Plain English
- It sounds so lame at first and I even admittedly hated myself for caving in and buying these books because I thought it was a bunch of nonsense
- But I was losing my mind from my commute turning into 4 hours a day from NJ Transit for the better part of a week in most cases, so I figured why the hell not
- And slowly but surely after I recovered from burning out, these books really did make a difference for me
- Now I always try to be present and in the moment instead of always thinking hours, days, weeks, years ahead
- This will help you become less impatient with paying your loans off
- You'll become grateful for what you have and resist the urge to want to buy things all the time
Track your spending habits with the Coffee Habit Worksheet
- I always say it's the little expenses here and there that when you add them up, make a big impact
- Maybe you still have a monthly fee for a membership you forgot about
- Maybe you don't realize you don't need that gym membership because you use a fraction of what's there
- Delay the gratification and put the work in now to enjoy life later when you really want to relax in your later years
Live below your means
- The only way you're going to be able to pay off your loans is if you're spending less than you're bringing in
- When you're in your twenties and thirties, you most likely won't have the highest salary of your career yet
- Figure out ways to live more frugally while you're young
- Cut your cable bill, revise your cell phone plan, whatever it takes to improve your financial situation to pay those loans off sooner
Reward yourself every once in a while
- This is probably the most important thing to remember
- You don't want to burn out and go on a spending spree only to find yourself back at square one
- I've had this happen to me a couple of times
- I was saving so much, barely doing anything fun that I went out every weekend in July one summer in the city with my friends and girlfriend
- As you can imagine, that wasn't good, I had to pay a huge credit card bill that month
- Celebrate the small wins so you feel like you're making progress
Update: Check out this article from CarefulCents on these 3 additional online jobs you can start and make great money
What else do you guys think will help others pay off debt faster? If you have any other ways, what's been working for you?
Like what you read?
Join all of us to get the latest posts on how to make, save and invest more. It's the only way to your financial freedom. In addition, you get the FREE Coffee Habit Worksheet to track your minor spending and see how it's really costing you over the long-term.