Student debt has actually always been a big problem, but it only really appears to be a huge issue at the moment because the negative effects of it are coming to the fore in a much bigger way than before. Millennials in particular who are dominating the workforce these days realise that the cost of their education was perhaps a lot higher than they anticipated and so they find themselves working more towards paying off their student debts than anything else. So many are even realising that it’ll take close to their entire working lives to pay back their student debt, which is really a cause for concern for anyone who is currently studying on credit and effectively building up student debt that mounts rather quickly.
If you are indeed studying having received financial assistance in the form of a student loan or even a scholarship, you may perhaps be guaranteed a job by your sponsor once you’ve completed your qualification and you graduate, but a lot of the hours you’ll put into your career will go towards paying back your student debt. Ask graduate engineers who believed that at this point in time they’d be earning comfortable salaries for a good day’s work, yet the student loans they’re busy working to pay back have them earning way less than some of their colleagues whom they deemed to have followed ‘softer’ fields of study.
If you’re at the very beginning of your academic studies at an institution of higher learning, you’ll likely be aware of the fate awaiting you once you graduate, if you are studying under a student loan. This doesn’t mean you can’t do anything to help the situation of course, and if you start right now you can work towards seriously softening the negative financial effects of the realities of a student loan.
Building up Capital
The trick to paying off your debt quickly lies in either periodically overpaying on your repayments or you should aim to reduce the interest rates by negotiating a new repayment deal having paid the equivalent of a deposit in the form of a lump-sum. Simply put, you’ll need some capital to your name by the time you enter the job market, so you have to start building that capital up right now through savings and through making smart choices with all the financial services made available exclusively to students.
I’m not suggesting you go through what’s meant to be the best years of your life without spending anything on making your student life more enjoyable. What I’m trying to say is that things like reduced student bus fares are there for exactly this reason, that being to help alleviate the financial burdens you face as a student right now and those which you’ll face in the future.
Build up some savings so that you can effectively chop the student loan repayments, while at the same time building up a good credit record so that you can perhaps get access to consolidation services or make use of loan swaps to perhaps benefit from lower interest repayments than those traditionally high ones attached to student loans.