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Paying off student loan debt

If you’re one of the 44 million Americans who owe over $1.6 trillion in student loan debt, the student loan debt crisis is a daily reality. The pursuit of higher education has brought with it a hefty price tag and you’re not alone.

More and more Americans find themselves shackled by student debt - postponing buying a house, getting married or even having kids in order to get out from under the piles of student loans.

According to a 2016 Consumer Reports survey of people with student loan debt, almost half said that - if they had it to do over again - they would accept less financial aid to pay for their school. They would cut costs, find other ways to pay for their education, or go to a less expensive school.

There’s a lot of information about navigating student loan debt, before and during college – but what about after graduation?

The cost of achieving your educational goals can stick with you long after college is behind you.

Let’s dive into some things you need to know about paying back student loan debt:

  • There are only 4 ways to cancel student loan debt
  • 3 things to get ahead of your student loans
  • What to do if you’re having trouble repaying your student loans

There are generally only 4 ways to cancel student debt entirely

  • Pay off the debt in full
  • Find a student loan forgiveness program*
  • Become permanently disabled
  • Pass away

*Beware! There are a lot of hoops to jump through to qualify and the percentage of applicants actually getting approved for loan forgiveness is very low. According to the U.S. Department of Education, only 1% of applications for loan forgiveness have been approved.

In the state of Washington, Attorney Bob Ferguson is urging Washington student loan borrowers who have had trouble with public service loan forgiveness to the Attorney General’s Office.

Watch out for repayment scams. Don’t be fooled by websites or companies advertising “student debt forgiveness” or too good to be true repayment plans. These companies will charge you high fees and “ensure” monthly payments. Always make sure you are contacting legitimate companies.

Even if you do not graduate with a degree, you are still responsible for repaying your loans. Repayment typically begins six to twelve months after a student leaves school. Keep in mind that consolidating student loans may result in your payments starting sooner.

Are there exceptions to these ways to cancel student debt? You bet. But these are general guidelines to follow.

How to pay down student loan debt

1. Create a budget

Here’s the deal. You need to budget. One of the best ways you can make a dent in your student debt is to look at your other expenses, credit cards, interest rates on loans, etc. Can you consolidate or get a lower interest rate on them? If you do, put that extra money toward your student loan payment.

2. Make more than the minimum payment

One of the best ways to pay down your student loan debt fast is by making more than the minimum payments. Even one or two extra payments through the year can have an impact. For example, you could apply part of your yearly bonus from work or a tax refund to your debt. Or you could participate in a 6-month savings challenge or a no-spend month to come up with the extra cash.

Don’t think those extra payments add up? Take a look:


  Starting Loan
Balance &
Interest Rate
(10-Year Loan Term)
Total Pay-Off
Extra $100
Paid Monthly
(Split Equally
Between Loans)
Total Pay-Off
Amount Saved
Loan #1 - Subsidized at
5% interest rate
$10,000 $93 $12,728 $143 $11,610 $1,118
Loan #2 - Unsubsidized at
7% interest rate
$10,000 $116 $13,933 $166 $12,251 $1,682
Combined Monthly Payment:   $209   $309    
Combined Total Pay-Off:     $26,661   $23,861 $2,800

3. Apply for the Numerica Student Loan Repayment Scholarship

Numerica Credit Union created the Student Loan Repayment Scholarship as a way to help support its membership. Two scholarships are available for up to $2,500. Check out the details for the Student Loan Repayment Scholarship.

Trouble repaying your loans?

Your loan provider can look into deferment or forbearance options for you. While this might allow you to postpone payments, it should only be used as a last resort. Keep in mind that when you extend the loan term it may reduce the monthly payment, but it­­ could also increase the amount of interest you pay during the life of the loan.

Contact your loan provider immediately if you are unable to make payments.

Don’t stop making payments on your student loan until you have another plan in place. If you stop making payments, you not only lose negotiating power of showing your effort to pay the bill, but the loan could go to collections and have an impact on your credit score.

The pursuit of education, and the debt that results in, is a balance. There is no magic way to cancel your student loan debt and if it seems too good to be true, it’s probably a scam. Paying off your student loans takes dedication to a budget and time as well as having some friends at the credit union who can lend some tips along the way.

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March 27, 2023