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7 Steps to Pay Off Your Student Loans in 5 Years (or Less)

Ben Luthi
student loan tricks
student loan tricks

Federal and private student loans often come with a repayment term of 10 years or longer. But even though you have that long to pay back your college debt, there are advantages to paying it off ahead of schedule.

In this quick guide, you’ll learn how to pay off student loans in 5 years or even less, and if it makes sense for your budget and financial goals.

How to pay off student loans in 5 years or less

Paying off student loans in 5 years or less is no easy task, but depending on your financial situation, it may be doable. Even if you can’t manage meeting that timeline, you may still be able to save money on interest and become debt-free sooner than expected.


1. Determine your pay off goals

You may be tempted to jump in and start increasing your monthly payments, but your repayment plan could be much more effective if you take a step back and look at your bigger financial picture.

To start, consider your goals. Do you want to pay off student loan debt in 5 years or less? Or do you simply want to get rid of it a little sooner than planned?

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As you think about what could work for your budget, focus on why you want to pay off your debt early to help you maintain motivation. Maybe you want to buy a home, have kids, or go on a dream vacation. Or you may just want to enjoy the relief of not carrying that burden everywhere you go. Whatever it is, make it concrete so you have something to look forward to.

2. Consider student loan refinancing

Before you get into the nitty-gritty of budgeting, think about whether you could save money and meet your pay off goals by refinancing your student loans.

If you qualify, student loan refinancing may allow you to get a lower interest rate than what you’re already paying. You’ll also have the option to choose a new repayment term. So if paying off student loans in 5 years is your goal, you can request a loan with a 5-year repayment term instead of one that matches your current repayment term.

Once you do that, you won’t have much extra work to achieve your goal — simply make your new payment every month as usual.

Before you pick a lender, though, take some time to shop around to compare rates and terms from several lenders. To make this process simple and quick, use Purefy’s rate comparison tool which provides rate offers from multiple lenders in one convenient place — with one easy form.

If you don’t qualify for student loan refinancing or you wouldn’t be able to afford the higher monthly payment that’s associated with a shorter term, skip this step and move onto the next one.

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3. Create a budget

Once you have an idea of when you want to be debt-free and whether refinancing can help you do it, set up a budget to help you achieve your goal.

Use an online student loan prepayment calculator and punch in the numbers for your particular situation, and it will tell you exactly how much you need to pay in addition to your regular monthly payments to make it happen.

Once you have this number, take a look at your income and expenses. Then determine how you need to manage your money going forward to ensure that you’re paying what you need to on your college debt.

4. Increase your income

If you can’t manage your desired payment every month while covering all your other necessary expenses, search for ways to earn some additional funds to make it possible.

This may include taking on a second job or working overtime at your current one, or you could look into side job opportunities to make extra money. Whatever you decide to do, avoid the temptation to use the money for other things — unless, of course, you can already afford your desired monthly payments but want a little extra spending money or more cash to set aside in savings.

5. Cut your expenses

Cutting back on certain areas of your budget isn’t always possible, but it’s still worth checking to see if it’s an option. Take a look at the budget you created and look for common expenses that you don’t need to incur.

For example, you may want to cut back on going out with friends and invite them to your place instead. Or look at your recurring subscriptions to see if you can consolidate some entertainment options, switch cell phone carriers, or get rid of a subscription you don’t really need.

Again, if your budget is already barebones, this step will be difficult. But if you can manage to cut even a little each month in other areas, it can make a big difference over several years on your student loans.

6. Look into loan forgiveness and repayment assistance programs

If you have federal student loans, you may have access to a handful of loan forgiveness programs and several loan repayment assistance programs. These programs are typically based on the type of job you have, so search for options based on your chosen career.

Most of these programs are run by government agencies and nonprofit organizations, and some offer up to tens of thousands of dollars in aid. However, some private employers also provide repayment assistance. Check with your employer to see if it offers that as an employee benefit. If not, keep that benefit in mind if you’re ever in the market for a new job.

7. Don’t give up

Figuring out how to pay off student loans in 5 years instead of the standard 10-year repayment plan can be exciting. But that’s still a long time to stick to your plan, and it can be easy to fall off the wagon at some point.

It’s important to evaluate your progress at least once or twice a year to make sure you’re still on track. Also, it’s easy to set goals, but you may find with this process that you need to make some adjustments along the way to make your goals more reasonable.

The bottom line

If you’re interested in learning how to pay off student loans in 5 years or less, it is possible with these steps. That said, the process is still lengthy. So it’s important to create a plan based on your goals and financial situation to make sure your plan is doable.

As you put your plan in motion, take time periodically to check-in to see if you’re still on track, and make adjustments if needed to achieve your pay off goals.

Need help with a personalized plan for your student loans?

At Purefy, our award-winning experts are ready to guide you through your best options to save.





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Education Loan Finance is a nationwide student loan debt consolidation and refinance program offered by Tennessee based SouthEast Bank. ELFI is designed to assist borrowers through consolidating and refinancing loans into one single loan that effectively lowers your cost of education debt and/or makes repayment very simple. Subject to credit approval. See Terms & Conditions. Interest rates current as of 11-21-2022. The interest rate and monthly payment for a variable rate loan may increase after closing, but will never exceed 9.95% APR. Interest rates may be different from the rates shown above and will be based on the term of your loan, your financial history, and other factors, including your cosigner’s (if any) financial history. For example, a 10-year loan with a fixed rate of 6% would have 120 payments of $11.00 per $1,000 borrowed. Rates are subject to change.

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Fixed rates range from 3.99% APR to 8.24% APR with a 0.25% autopay discount. Variable rates from 2.24% APR to 7.99% APR with a 0.25% autopay discount. Unless required to be lower to comply with applicable law, Variable Interest rates on 5-, 7-, and 10-year terms are capped at 8.95% APR; 15- and 20-year terms are capped at 9.95% APR. Your actual rate will be within the range of rates listed above and will depend on the term you select, evaluation of your creditworthiness, income, presence of a co-signer and a variety of other factors. Lowest rates reserved for the most creditworthy borrowers. For the SoFi variable-rate product, the variable interest rate for a given month is derived by adding a margin to the 30-day average SOFR index, published two business days preceding such calendar month, rounded up to the nearest one hundredth of one percent (0.01% or 0.0001). APRs for variable-rate loans may increase after origination if the SOFR index increases. The SoFi 0.25% autopay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. This benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. The benefit lowers your interest rate but does not change the amount of your monthly payment. This benefit is suspended during periods of deferment and forbearance. Autopay is not required to receive a loan from SoFi.

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Actual rate and available repayment terms will vary based on your income. Fixed rates range from 4.24% APR to 9.24% APR (excludes 0.25% Auto Pay discount). Variable rates range from 3.49% APR to 8.24% APR (excludes 0.25% Auto Pay discount). Earnest variable interest rate student loan refinance loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent. The rate will not increase more than once per month. The maximum rate for your loan is 8.95% if your loan term is 10 years or less. For loan terms of more than 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95%. Please note, we are not able to offer variable rate loans in AK, IL, MN, NH, OH, TN, and TX. Our lowest rates are only available for our most credit qualified borrowers and contain our .25% auto pay discount from a checking or savings account.

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Fixed Rate Loan Terms: 5 years/60 monthly payments, 7 years/84 monthly payments, 10 years/120 monthly payments, 15 years/180 monthly payments, or 20 years/240 monthly payments. Annual Percentage Rate [APR] is the cost of credit calculating the interest rate, loan amount, repayment term and the timing of payments. This rate is expressed as an APR. Fixed APRs range from 3.94% to 8.48% APR [low to high range with 0.25% auto-debit rate reduction]. Rates are subject to change without notice. Fixed rates will not change during the term. Since there are no fees associated with this loan offer, the APR is the same percentage as the actual interest rate of the loan including a 0.25% auto-debit rate reduction. These rates are subject to additional terms and conditions, and rates are subject to change at any time without notice. All estimates are based on information provided by you and are for informational purposes only, accuracy is not guaranteed and may not reflect actual rates or savings and do not constitute an offer of credit. Your actual rate, payment and savings may be different based on credit history, actual interest rate, loan amount, and term, including your cosigner [if applicable]. If applying with a cosigner, we use the higher credit score between the borrower and the cosigner for approval purposes. All loans are subject to credit approval.

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