Attending graduate school is a great way to expand your career prospects and gain some real knowledge in your chosen field. But while graduate school is a goal for many college students, the harsh reality is that many will also struggle with student debt.
It’s no surprise that college is expensive. Graduate school may be a wise investment in the long run, but that doesn’t change the fact that student loan debt can be a major stressor for adults after graduation.
So, how much debt are we talking? Research shows that the average yearly tuition for graduate school at a public university is around $30,000. This number rises to $40,000 for private universities. Add to that the cost of living expenses and you’ll begin to understand the vast economic undertaking involved when deciding to attend graduate school and why so many graduates explore ways to refinance grad school loans.
But while expensive, millions of graduate students remain undeterred and continue to take out loans to pay for their degrees. Student loans are, of course, the easiest option to choose when it comes to paying for tuition, but how do you know these loans will serve you well after graduation? How can you be sure you are approaching your student debt with the best possible plan of action?
Paying back student loans isn’t easy. The stakes become even higher when dealing with expensive graduate school degrees. But there are ways to ease the impact of sky-high tuition costs and student loan interest rates.
For many, the answer is student loan refinancing. Finding ways to refinance grad school loans can lead to significant savings in the future and there’s no better time to start weighing your options.
What does the average graduate student owe in student debt?
How much you’ll pay for graduate school tuition depends on several variables. On average, graduate students accumulate $71,000 of student loan debt, according to NerdWallet. This doesn’t even include undergraduate loans. What’s worse – the numbers for a Ph.D. are even higher. But just because you’ve taken out tens of thousands of dollars in student loans doesn’t mean you’ll be forced to pay them back immediately. You have options when it comes to student debt relief and how to refinance grad school loans, and they come in several forms.
How to pay off grad school loans
The sooner you begin researching how to pay off grad school loans, the sooner you can begin working toward a debt-free future. Here are a few ways how to pay off grad school loans.
Public Service Loan Forgiveness
This is a great option for graduates that borrowed loans from the federal government. You do, however, need to meet certain requirements in order to be granted loan forgiveness. To qualify, you must:
- Be employed full-time by a U.S. federal, state, local, or tribal government or not-for-profit organization;
- Have Direct Loans (or consolidate other federal student loans into a Direct Loan)
- Repay your loans under an income-driven repayment plan
- Make 120 qualifying payments.
While public service loan forgiveness isn’t something that is granted overnight, it can still serve as a valuable form of relief for how to pay off large student loan debt.
Make larger monthly payments
The fastest way to rid yourself of debt is to pay it off more quickly. You can start by making larger monthly payments. While your minimum payment is designed to incur interest, you can circumvent this harsh reality of loans and instead pay it off as quickly as you can. You may need to do some serious budgeting for this, but you’ll save thousands of dollars in the long run if you can manage to pay off your student debt sooner rather than later.
Make multiple payments each month
Getting into the habit of making multiple payments on your loans each month will set you up for success. You can do this by cutting back on some discretionary spending, like going out to eat or ordering take-out. By carefully budgeting your money, you can make multiple payments each month and pay off your debt that much more quickly.
Use cash windfalls to put toward debt
Whether it’s a large tax refund or perhaps an inheritance, those cash windfalls come in handy when you’ve got student debt. It can be tempting to take new money and purchase the things you’ve been wanting, but be aware that there will be time for that in the future. Putting cash windfalls toward your debt rather than splurging can set you up for good financial decisions in the future and get you debt-free much sooner than you’d thought.
Refinance student loans
Refinancing student loans is another wise option if you’re hoping to save some money throughout the course of your loan. Many students look to refinancing to clean up the financial messes of their pasts and begin a path toward wise spending and budgeting. For instance, you may have taken out a loan at a high interest rate because you needed tuition money quickly. But making decisions in haste can lead to consequences down the line, and they make come in the form of sky-high interest payments. You can avoid this by refinancing your student loans.
If you’ve recently graduated an advanced degree and have secured reliable employment, you might make a great candidate for student loan refinancing. Often, graduates with a high income and credit score are considered good lenders, and this is also true for student loan refinancing.
How to find your best student loan refinance rate
Refinancing your student loans can result in big savings when deciding how to pay off large student loan debt. When refinancing, you’ll likely get offers from a variety of lenders, so it’s up to you to determine which makes the most sense for your unique goals. Using a rate comparison tool can help you make sense of what each lender is offering, allowing you to make an educated decision about student loan refinancing. Refinancing now is a great move in securing a bright financial future.