Tackling student debt: Tips to help you eliminate this bothersome burden

As the prices of college tuition continue to skyrocket, the dark cloud of student debt is becoming a long-term financial burden for more and more dental hygienists. As students, we all yearned for the days when we would be bringing home the paycheck that we dreamed of, but in stark reality the money we now receive somehow never seems to go as far as we would like. Student debt is often a roadblock that stands in the way of many of life’s goals, such as home ownership, parenthood, and perhaps even furthering your education.

According to the Institute for College Access and Success, the average college debt for the class of 2017 was $28,650.¹ Across the country, 65% of college seniors graduated with college debt from both public and private nonprofit universities.¹ Almost one out of four federal direct loan borrowers was in default or delinquent by more than 30 days.¹

According to Make Lemonade, a website that is dedicated to helping others “live a better financial life,” $1.5 trillion is currently owed in student debt across the United States.² That astounding number comes from the combined 44 million borrowers who are presently attempting to pay off their student loans.

Many people are not sure how to approach student loan debt because it can be quite intimidating. The good news is that if you follow these easy steps I discuss here, you will be able to clear this financial hurdle without too much stress. This link illustrates how the amount of money that you pay each month on your student loan dramatically affects the length of time that you will be paying for the loan. When you take advantage of the many options available to erase student loan debt, you may be surprised at how soon you can make this financial burden disappear.

Don’t delay on starting payments

One of the best ways to get a head start on your student loan is to start paying toward it as soon as you graduate. If you are a current student, you can start paying down the interest on your loans before you graduate. According to Federal Student Aid, an office with the US Department of Education, interest is already accumulating on most student loans while the person is still in school, even if the loan has a grace period.³ As explained in US News and World Report, Federal Stafford loans have a grace period of six months, and the grace period is nine months for Perkins loans.⁴ Even if you can afford only small payments, this all works to your advantage.

Add a little extra to your payments

As explained by Edvisors, the average length of a federal loan is 10 years.⁵ With private student loans, the repayment period may range from five to 15 years. Any action that you can take to pay off your loan sooner will help you get to where you want to be financially. But the burning question is, “How can I actually make this happen?”

Paying off your loan early may not be as difficult as you think. One easy step is to round up the amount on your monthly loan payment. For example, if your payment is $222.48, round it up to $230 per month. You most likely will not notice the extra $7.52 missing, and over the life of a 10-year loan you will be done paying four months earlier.

Another easy step is to make payments every two weeks instead of on a monthly basis. The amount you pay by using this method is half of what you would normally pay. Using the $222.48 monthly example, if you make 12 monthly payments, that adds up to $2,669.76 per year. If you make a payment every two weeks instead, typically when you receive your paycheck, the final annual amount paid adds up to $2,892.24. The two-week method means you pay an extra payment over the course of a year and over the life of a 10-year loan, so you can pay the loan off almost a year early. An even better option is to combine both of the above methods to make an even bigger dent in your student loan debt.

Pick up extra workdays

A very practical way for a dental hygienist to earn extra money is to occasionally work as a substitute at other dental offices. If you do this for one full workday per month, over the course of a year you could make an additional $3,000 to $4,500. The nice thing about using this method is that you can choose what portion of the extra money goes toward student loans and what can be a little fun money for you.

Finding extra days to work isn’t difficult in today’s economy and usually involves just getting your name out there. Join local dental Facebook groups and set up your notifications to receive all posts. Then make sure to check your notifications on a regular basis. You can also work with a dental staffing agency that will help you find temporary work. Another option is to call nearby dental offices and ask them to add you to their substitute list.

Be wary of student loan consolidation

As explained by Federal Student Aid, consolidation of student loans involves combining multiple federal loans into a single loan with one monthly payment.⁶ Private loans are not a part of this process, so you still have to make separate payments for these. Loan consolidation can be very tempting because it decreases the overall payment amount. The catch is that it usually increases the length of time that you will be paying on your loans, as well as the total amount of interest paid. If unemployment or other financial hurdles cause you to fall behind on your student loans, deferment or forbearance may be good options to use if you’re seeking short-term relief.

Refinance your student debt

As explained by Make Lemonade, student loan refinancing will often help you receive a lower interest rate so that you can pay off loans more quickly.² The federal government does not refinance student loans, so you must work with a private lender for this process. By refinancing you can combine both federal and private loans into a single loan. Private lenders look for candidates who have a credit score of at least 650, a low debt-to-income ratio, and a stable, consistent income. Loan terms are flexible and range from five to 20 years. But, it is better to choose the least number of years that will give you a reasonable payment in order to pay less interest overall.

A student loan calculator is available at makelemonade.co/calculators/student-loan-refinancing-calculator/ to help guide your decisions. When using this tool, type in the current amount of your student loan debt, the average interest rate, and the remaining number of years on the loan. Then enter the new interest rate and new loan term (in years) in order to calculate your new payment. This tool allows you to easily compare your current payment to your new payment, as well as view the amount of interest that would be saved over the life of the loan.

Amber Metro-Sanchez, BA, RDH, practices dental hygiene with Chris Bible, DDS, at Comfort Dental in Fort Wayne, Indiana. She also works as a professional educator on behalf of Waterpik. Amber was a member of the 2015 Colgate Oral Health Advisory Board. She is also a contributing author for the Colgate Professional and Colgate Oral Care Center webpages. Reach her at [email protected].