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Paying Off Student Loans - Smarter and Faster

Published on Author Purefy Staff

How to Pay Off Student Loans Faster?

There's no magic formula to pay off student debt, but there are several strategies you can use to save time, money, and keep yourself motivated. These strategies, paired with refinancing are a smart approach to paying off debt faster.

Bi-weekly Payments

A strategy popular in the mortgage industry, making bi-weekly payments can cut down on your interest costs by applying a higher portion of your payments to the principal balance. Student loan interest accrues daily, so paying half of your monthly payment one week and the rest two weeks later helps reduce the amount of interest that accrues each month. Remember, there are no prepayment penalties with PenFed, so you can pay early without consequences.


Putting your monthly payments on auto-pay doesn't technically save you money, but it could still keep you from forgetting a payment. Automating your finances is a simple way to ensure you don't miss a payment, which could cost you in late fees. Auto-pay can also make paying loans less painful — if you never see that money, you don't miss it as much!

Avalanche Method

Some borrowers who refinance don't include all of their loans in the consolidation. If that's the case for you, you can focus on paying off loans with the highest interest rate first. You save money on interest costs by prioritizing your high interest rate loans while still making the minimum monthly payment on your other loans. But remember, you may find that refinancing can lower your rate on both federal and private loans, to get everything on one easy monthly payment and a more favorable term.

Snowball Method

If you have a small loan with a low interest rate that you don't wish to refinance, one strategy is to focus on paying that loan off first by aggressively putting extra cash toward the balance. Having one loan completely gone — even a small one — is a great way to stay motivated and get out of debt. Once you pay off the smaller loan, take the money you were putting toward that monthly payment, and apply it to the your next loan.

It's important to remember that with these repayment strategies, you'll still need to make monthly payments on all of your loans every month — just focus any excess cash you have using the method you choose.

Having a strategy isn't just beneficial to your wallet — it also helps you feel in control of your debt. Personal finance is about finding a strategy, or combination of strategies, that works for you.