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How to Pay off Student Loans Within 6 Months of Graduating

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How to Pay off Student Loans Within 6 Months of Graduating

69% of seniors who graduated from public and nonprofit colleges in 2013 had student loan debt, averaging $28,400 per borrower. College was an unforgettable experience that we’d do over again if possible. It was a safe place to explore new opportunities and build relationships that could last a lifetime.

Fast-forward to today and graduates are forced to make decisions within financial constraints. For example, someone graduating with 40k in debt might move in with their parents to save money on rent. While this decision is fiscally responsible, it can impact one’s career trajectory. A lot of smart people credit their career success to having optimized learning early on in their careers.

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There are two ways to pay back loans. The first is to make the minimum payment each month for 120 months and put payback on auto-pilot. The second is to pay them off as quickly as possible to avoid interest. With most lenders offering a six-month grace period for interest, I’d like to explore a few ways to eliminate them.

Craigslist

People are usually more than willing to part with old stuff. I’d never recommend soliciting to sell people’s junk. Start with your old stuff, friends that could be moving, or family member’s stuff that might be ready for a spring cleaning. You’d be surprised at how well things retain their value. Offer to split the sale 50/50. To make this worth your time look for things that are in excellent condition, vintage, or retain value well. I’ve written an extensive guide with examples that helps with the listing process.

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eBay

If it can fit in a box, sell it on eBay. I’d start with electronics or brand name clothing. Remember all those things you “had to have” before being a poor college student? Give your listings a title that would appear if they were sold new on a retail site, take great pictures, and start them as an auction at $0.99 with no reserve. This will help your listings get seen by the most amount of people.

Pro tip: Anything Oakley brand or related to sunglasses will sell for way more than you’d expect.

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Trove

If you’re moving away from campus after graduating, you can use Trove to sell furniture before you go. There’s always a large amount of furniture in perfect condition sitting on the curb during move-out week. People will pay good money for well-kept, used furniture. If posted on the right website, you should have no problem getting back some of what you paid for yours. Trove is also a great option for buying brand name used furniture at a fraction of the cost.

Airbnb

Being an Airbnb host is a legitimate alternative to living at home after graduating. The supplemental income earned from one room can cover a month’s worth of total expenses. This can free up regular income and allow you to throw entire paychecks at those annoying loans, bringing them down quickly. Even further, hosting after completing loan payback, can eliminate living paycheck to paycheck.

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Of the four options mentioned, Airbnb has the highest return on effort. Home sharing is relatively new, and a lot of people are still on the fence about it. I’ve hosted over 100 guests and have never had a terrible experience. LearnAirbnb is a great resource for getting started.

The freedom of being debt free significantly outweighs the sacrifice it takes to get there. Implementing the tactics above increases your ability to chase opportunities and take calculated risks. It will also give you a real world crash course in personal finance. Be entrepreneurial, work on projects that you find interesting, or your passion. This is much easier to do without having the burden of student loans.

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Featured photo credit: Evonne via flickr.com

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