Student loans might not seem urgent while you’re still attending lectures and writing papers, but waiting until graduation to think about them can cost you. Interest keeps adding up while you’re busy with exams and projects. The good news? You don’t have to wait. Starting early even with small steps can ease your future loan burden in a big way.
Let’s break down a few practical, low-stress tips to help you pay off student debt while you’re still in school.
1. Make Interest-Only Payments During School
Most federal and private student loans start collecting interest the day the money hits your account. If you have unsubsidized federal loans or private student debt loans, that interest keeps adding up while you’re in school. And if you’re not paying it as it comes, it could be added or “capitalized” into your loan later. That means you’d start paying interest on your interest once repayment begins. Ouch.
But here’s something simple you can do: make interest-only payments during school. Even small monthly payments toward your interest can help lower your total loan cost.
Before you decide how much to pay, check the interest rate on your student loan. Knowing this helps you understand how quickly interest adds up, even if you’re not required to pay right now. This one move can stop your balance from growing unnecessarily and make repayment easier after graduation.
If you’re not sure how much interest you’re building up, log into your loan account or contact your servicer. Most of them provide a breakdown showing how much interest is accruing and what you’d need to pay monthly to keep it from growing. Seeing those numbers can help you plan and budget better.
2. Set Up Small, Regular Payments
You don’t have to make big payments. What matters is consistency. Setting up small, automatic monthly payments say $20 or $50 can go a long way. Many lenders even offer a slight interest rate discount when you use autopay. You’ll stay on top of your loans without needing to think about them every month.
It also gets you in the habit of budgeting for your student loans, which will be useful once you’re out of school and the payments become mandatory.
Even a few dollars each week can chip away at your interest. If you’re working or have any form of income, try committing to a weekly transfer into your loan account. You’ll hardly notice the difference, but your loan balance will.
3. Use Part-Time Income or Side Hustle Money
If you’re working a part-time job or running a side hustle while in school, you might be tempted to use every dollar for books, food, or fun. That’s fair you’re juggling a lot. But if you can put aside even 10% of your earnings toward your loan, you’ll thank yourself later.
Try setting up a second savings account just for student debt loan payments. Every time you get paid, drop a little in. Once you hit a small goal like $100 make a payment. It’s a satisfying way to see your efforts pay off.
Don’t overthink it. There’s no perfect amount. What matters is getting into the habit of contributing. Even small payments reduce your overall interest and get you closer to being debt-free.
4. Avoid Forbearance Unless You Really Need It
Forbearance might seem like a helpful option if money’s tight, but it comes with a hidden cost. When you pause your payments under forbearance, interest continues to grow. And if it’s not paid, it could be added to your loan balance later.
Unless it’s an emergency, avoid putting your loans on pause. You’re better off making small interest-only payments now than facing a larger balance after graduation. If you’re struggling financially, talk to your loan servicer about options instead of jumping straight to forbearance.
Deferment is another option, but the rules vary. For some loan types, interest still accrues. That’s why checking the details of your loans and understanding the type you have makes a big difference.
5. Use Scholarship Refunds or Extra Aid
Some students receive more in grants, scholarships, or aid than they need for tuition and fees. If you get a refund check from your school, consider using it to pay down your loans. It might be tempting to spend it elsewhere, but applying even part of it to your student loan can reduce your balance.
This is especially helpful if you’re receiving unsubsidized loans, where interest builds while you’re in school. Use any extra money as a smart shortcut to save on future payments.
If you get gift money or financial help from family, consider using a portion of it toward your loan. You don’t need to use all of it just a small percentage can make a noticeable difference down the road.
6. Track Your Spending and Make Room for Loans
It’s easy to lose track of small purchases late-night food orders, subscriptions, impulse buys. Take a week to track everything you spend. You might be surprised where your money goes.
Once you see the patterns, you can choose one or two areas to cut back slightly. That extra money could go directly to your loan. You don’t need to sacrifice everything, just make small adjustments that free up cash.
Use a simple spreadsheet or a free app. Just having a clear picture of your finances can make you feel more in control and help you reach your student debt loan goals faster.
7. Set a Simple Repayment Goal Each Semester
Goals help keep you motivated. Instead of trying to pay off a big chunk all at once, start small. Set a goal like “pay off $250 by the end of the semester.” Break that down into monthly or even weekly targets.
These small wins add up. They also make it feel more doable and less overwhelming. Every dollar you pay now is a dollar you won’t owe later with interest.
Once you hit that goal, set another. You can even make it a personal challenge or reward yourself when you reach it. These bite-sized steps keep you on track without stress.
Paying off student debt while still in school might not be common, but it’s smart. You don’t have to pay it all off. You just need to start. By covering your interest, setting up automatic payments, and using extra income wisely, you’ll stay ahead of the curve.
Future-you will appreciate that you didn’t wait. And you’ll graduate knowing you’ve already taken steps to lower your debt before the bills even start.
