Student loans are an extremely stressful part of graduating college, but repaying the debt can be done by being extremely savvy and smart with your money. Currently, students can pay can cap off their payments at 10% of their monthly income. Obama is working to expand this legislation so that if you borrowed money before October 2007 or haven’t borrowed since October 2011, Obama is extending the 10% of monthly income as the cap of loan payments to you! White House Officials say that this will assist with bad credit for young workers. It is an important order to pass, as it fits with in a more general government goal to “stimulate faster economic growth without relying on legislation.”
Despite this new executive action, you will still have to repay your student loans. But there are many ways to be savvy and get out of your debt just a couple years after graduating. While some people are extreme (see here), here is some advice to make a quicker escape from your student loan debt through the way you live. Take some tips from these extremists:
- When all of your friends are going out to drinks or dinner, eat and/or drink beforehand at home so that you don’t spend money on eating out or pay extra for expensive cocktails.
- Always keep in mind the future: the bigger picture. Remember that if you follow these money saving tips, you will be out of debt more quickly and you will be able to move on with your life!
- Follow savvy money saving tips on Pinterest (some of the extreme savers made their own furniture and shampoos and other types of cleaners)
- If you have a car, use it less and cut the costs on gas. Walk or ride a bike instead!
- Save big travel plans until you can definitely afford it. Move back in with your parents or live in a cheap place (NYC may be the hot spot, but it’s definitely not affordable)
- Keep a record of your spending/budget yourself
- Before you purchase something or go to spend money, ask yourself: Do I really need this or can it wait?
As stated on the Huffington Post, “Senate Democrats have proposed legislation that would allow millions of Americans to refinance both federal and private undergraduate student loans at lower interest rates,” while Republicans feel that this may be too costly for the government. While it is a debate between the two parties, President Obama signed the order on Monday June 9th.
What do you think of Obama’s executive action?
Featured Image via salon