The cost of education is rising and it’s becoming difficult for students to meet their college and tuition costs. A survey has revealed that around 25% of college students have taken out a student loan to fund their studies and graduated with debts.
Due to student loan debt burden, most of the students struggle to buy houses for themselves after meeting the basic expenses and paying monthly bills. As a result, most of them live with their parents or rent a house. Thus, they're far from financial independence. The whole scenario impacts their lifestyle, too.
In this context, you have to find out ways to save money after making payments toward student loans and other expenditure.
How can you save money after meeting your student loan payments?
If you are a college student, then it is important for you to learn strategies for managing money. Most of you tend to spend more in this age; as a result, you fall into financial troubles. Thus, saving money become next to impossible thing for you. Following are some ways you can save money even with the burden of student loan.
1. Learn how to manage money
Managing money is not as difficult as you think. At first, you need to cut down your bad financial habits. For instance, using multiple credit cards for each purchase, impulse buys, eating out, etc. In general, avoid living an impulsive lifestyle and categorize the things that are not necessary, and you can live without those items.
2. Construct a budget
Formulate a budget and get the detailed analysis of your savings and expenditures. You need to include scholarship, cash gifts, pocket money as your income and also the money you’re able to earn through part-time jobs. Expenditures will include all of the college fees, tutorials attended (if any), and other important and essential expenditures. After you list all of these, you will have to find out if the amount you spend is within your affordability, and if you can anyhow lower the expenditures.
Try to save at least 10% of your income and put the money that you're able to save from your expenditures as well. Having a savings account is important as it helps you save money and use it in times of emergencies or to save money for future use.
3. Trim down extra expenses
Apart from budgeting, cutting down extra expenses and saving money is also important. You need to try and save money on the debt payments. This can be done simply if you make on-time debt payments. You may ask as to why this is important and how this can help you in saving money.
4. Pay your bills automatically
Save money on your late fees. How can you do that? Set up automatic payments so that the amount from your checking account gets deducted automatically. Setting up auto-pay will help you to get 0.25% interest rate deduction as well. You’ll save up to hundreds of dollars on the total loan amount.
5. Start saving as early as possible
There's no right time to start saving. So, don’t wait for the right time to start saving money. Make up your mind to save a certain amount of money on a regular basis. If you don’t have an emergency fund, then you may not be able to tackle many emergencies like medical emergencies, job loss, and so on.
6. Revisit your repayment plan
Are you struggling with your student loan repayment? If yes, then you may be following a wrong repayment plan. Experts suggest that every student loan borrower should revisit their repayment strategy time to time. Take the right repayment advice and get rid of your loan.
Keep patience and stay focused on your goal. Try to become more strategic to manage your student loan debt. You may need professional help as well. It will take some time, but you’ll start saving money soon.