Work Options for Paying Back a Student Loan

So you've graduated with $40,000 in student debt. What can you do to pay it back fast?

If you're like most graduates with giant student loans, you're probably looking for ways to get yours paid off faster than the payment schedule (which could be anywhere from nine to 25 years) set by your lender. There are a number of alternatives available to you, but the first thing you absolutely must do before you attempt any of them is to consolidate your loans. This tactic won't reduce the principal, but it can lower your interest rate and make the payments themselves more convenient to make.

It's not easy choosing a work option to pay back your student loan fast. These options all involve sacrifices - and making them at a time when you've probably just finished a four-year stint of making tough sacrifices. Still, getting your financial house in order when you're young will pay huge dividends down the line. The faster you pay off your student loans, the sooner you can start funneling your money into more long-term equity like home ownership and a retirement savings plan.

Here are some options on how to do it.

Join the military

If you live in the United States, you may want to look at signing up for the Army, Navy, Marine Corps or Air Force, which all offer some kind of student loan repayment plan. The U.S. Army will pay back up to $65,000 of your loans for just three years of service.

Pros : Not only does this option pay off your debts in a concentrated period of time, but it also provides you with some legitimate job experience that you can transfer easily to a number of other careers. There is also the option of taking part in the GI Bill once you finish your service, which can help to cover the cost of graduate school if you decide to go that route.

Cons: At the time of writing, the U.S. military is still embroiled in deadly conflicts in both Iraq and Afghanistan, with the vast majority of new recruits being assigned to these hot zones. Before you sign up, you really need to consider whether paying off your student debts is really worth risking your life or suffering serious wounds in a battle that continues to have no end in sight.

Move back in with Mom and Dad

If there's one monthly expense that can give student loan payments a run for their money, it's rent. Moving back in with the parents for a few years after graduation is a good way to eliminate (or at least significantly reduce) rent costs, thus allowing you to funnel that money directly into your student debt.

Pros: This route can pay down your loans very quickly. Most people, even when fresh out of school and working in their first job, still budget several hundred dollars each month for rent. Remove that expense from the equation and you've got some serious cash to put toward extra payments.

Cons: This one's a no-brainer. Who wants to spend the most formative (and fun!) years of your adult life still living under Mom and Dad's roof? It also takes a certain discipline to make sure that you're in fact putting all those savings on rent toward your debt. If you can't do it, it may start to feel like you'll never be able to afford your own place.

Teacher payback incentives

If you have a teaching degree and live in America, there is the option of participating in various incentive programs offered in some states aimed at getting teachers working in underfunded or underserved schools. Basically, you agree to work for lower pay for a period of time (usually four to five years) in these schools and in return the government forgives or pays off a portion your student loans.

Pros: Even though you're making less money in this program, it is reassuring to know your student debt will be canceled at the end of it. This is especially advantageous if you owe more money than you could hope to pay off even when working for a more regular, higher salary. Also, the states offering these incentive programs do it because there is a real demand for teachers, and this allows you to get some legitimate job experience immediately after graduation. Once your four- or five-year term is up, you'll have a good chance of landing a better-paying job, and with no student loan payments to worry about!

Cons: Any way you slice it, four or five years is a long time to be working in a low-paying job for which you studied four years to gain the qualifications to do. If your student debt isn't all that astronomical, you might be better off giving this program a pass and just working at a regular school: even when you factor in monthly student loan payments, you may still take home more money at the end of the day.

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