Graduates: 7 Strategies to Deal With Your Student Debt

You've spent the last few years experiencing some of the best (and worst) times of your life. Independence -- it's marvelous, isn't it? Freedom from your parents -- pretty sure you've taken advantage of it. Your education -- I know you've probably studied long and hard for that final GPA. Now the moment that seemed as if it would never come is here. You're about to graduate and six months later someone's going to begin communicating with you to remind you of something you borrowed from them.

Who? Oh, you know exactly who!

But see, I don't want you to dread the moment when you realize you probably borrowed a little too much for school. I want you to prepare for it. Don't be scared and run away from your problems. I can assure you ten years later they'll still be waiting for you to settle up. Keep calm, make a plan, and listen to what I have to say. You're going to want to know these seven strategies when it comes time to deal with your student debt.

1) Hack your grace period.

Your student loan provider gives you six months after graduation before you have to start paying on your student loans. Think of it as a graduation present, even though it's a really lousy one. You have time to get yourself together before you have to start paying your debt, so use this time to get a job. Even if it's not in your field of choice, find something! Make a budget and then pay yourself your student loan payment. When your grace period is up, you will have a huge payment stashed away in savings to apply to your loans. Plus, you've just trained yourself to come up with the money for your monthly payment.

2) Consolidate your loans if necessary.

If you have loans with multiple companies, use the National Student Loan Data System to view all the student loans you have borrowed. This database pulls all student loan information in your name and provides you with the carrier and how much you've borrowed. If having multiple student loans carriers bug you, consider consolidating into a Direct Consolidation Loan.

3) Sign up for auto-pay.

Interest is not your friend. This is the part about student loans that's going to cause you the most headache. It seems every time you send in a payment, very little goes toward the actual amount you borrowed and the majority goes towards interest! So here's the thing, if you sign up for automatic payment through your student loan carrier, many of them offer interest rate deductions. You betta save that money! Sign up for the auto pay and keep a nice little buffer in your checking account so you don't have to worry about the money being available when it's time for your payment to be withdrawn.

4) Consider student loan refinance.

Again, it's worth repeating -- interest is not your friend. However, using auto-pay to reduce your interest rate is not your only option. If you can afford the standard repayment plan (usually 10 years), you can probably afford to refinance your student loans and get a lower interest rate. Here's one thing to consider -- if you refinance, you lose those little perks the government offers like economic hardship deferment. Make sure you explore your options and choose what's best for you.

5) Start a side hustle.

Now this one is big! Consider this -- make a $500 student loan payment for 10 years under the standard repayment plan, or pay $1,000 a month and cut your repayment period in half? Not only does the second one sound appealing because you'd be getting out of debt quicker, you would be saving money too! That's years shaved off the life of your loan and less interest paid. So, how can you pay twice your minimum payment a month? Pick up a part-time job, work overtime, or utilize my favorite money making method -- side hustling. It's what I'm doing and I can vouch that it's working!

6) Accept forgiveness.

There are two ways you can go about this forgiveness thing -- volunteer or choose a career path that allows student loan forgiveness. If you work in public service roles such as teaching, nursing, or certain legal fields, you may qualify for student loan forgiveness. Read up on the terms to make sure your loans and profession qualify. Also, don't overlook several volunteer opportunities to get portions of your loans forgiven such as PeaceCorp and AmeriCorp.

7) Avoid new debt like your life depends on it.

Drake says, "no new friends." Well, I'm telling you, no new debt! As long as you're in debt you are missing out on the power of compound interest. With compound interest, instead of paying interest on a loan, you invest your money and reap the rewards of your money working for you. This is much better than paying to borrow others money.

Wrapping This Up

These seven strategies aren't complex formulas that'll cure all your money woes, but it's sure as heck going to help you save money and get out of debt faster. The quicker you ditch your student loans, the sooner you'll be able to reach financial independence. If financial independence doesn't sound appealing enough, then let's just say, ditching your loans will keep you a step further from having to move back home and losing the independence you've been relishing these last few years.

I know, I know... You're welcome.