Introduction

Student loans debt has been rapidly increasing over the past ten years, primarily because student tuition fees are now higher than at any time and also because many student grants have been abolished. As a result student loans debt has become an essential part of the university process. However the sinister side to student loans debt is the stress and anxiety it can cause and so to combat this we have researched some practical ways in which you can reduce your students loans debt and remove some of the emotional worry.

1. Only Borrow What You Need

This sounds simple but much of the current student loans debt could be avoided by applying this simple principle right at the start. Our advice is to carefully think through your financial needs and prepare a budget for the year. If this is your first year at university then creating a budget may be a daunting task but think about some of the following costs including; accommodation, University materials such as books and stationery, electricity, water and other utilities charges, council tax (unless you live in an all student property), food, clothes and socialising costs. Also whilst it might be nice to have a car, think through whether this is essential. Keeping your borrowing to minimum will stand you in good stead for reducing your student loans debt in the future and mean that your debt will be smaller and accumulate less interest.

2. Get A Part Time Job

The days of solely relying on your student loans debt to support you whilst at university have long since disappeared and it is now essential to get a part time job of some description. You can turn this to your advantage by using the money to start to reduce your student loans debt from day one and even small but regular contributions from your part time job will help reduce the rate at which interest accrues on your student loans debt. Also the internet has bought about a revolution in home based working, so why not turn your skills into cash online, we offer a variety of ways in which you can earn money online without leaving the house and you can view them here.

3. Take A Gap Year Before University

There are many great reasons to take a gap year before University. Not only does it allow you to experience real life but it also enables you to be better prepared for University by developing independent living skills, especially if you have never lived away from home before. In addition it can be a great way to reduce student loans debt in the future. Try to find some type of paid employment and use the opportunity to build up a reserve fund of money which you can use whilst at University. By doing this it is possible to reduce your initial student loan borrowing and therefore reduce student loans debt in the future. To maximise your earnings try to live at home so that you have minimal accommodation costs to pay out for. It is perfectly possible to build up a reserve of between £3000 - £5000 during this period, which may pay for a good chunk of your first year at University as well as reducing your overall student loans debt.

4. Make More Than The Minimum Student Loans Debt Payment.

When it comes to paying off your student loans debt where possible try to make more than the minimum payment. Remember that the longer it takes you to pay off student loans debt the more expensive it will be because of the amount of interest you will have to repay. Even making an overpayment of £20 or £30 more at a time will have an effect upon reducing interest and paying off your student loans debt more quickly. Try to factor this into your monthly budget and automate the process by setting up a standing order directly from your bank account. That way you won’t even notice the financial impact as acutely.

6. Parental Financial Support

One of the key problems with student loans debt is that it is difficult to make substantial payments whilst at University to keep your student loans debt under control. As such when you finish your studies your student loans debt already looks formidable and it is not unusual to leave with £25,000+ worth of student loans debt. If your parents or other family members or friends are keen to help consider asking them for small but regular financial assistance to keep your student loans debt under control. Think about it, if you asked 5 family members to contribute £5 per month towards servicing your student loans debt it may be enough to more than cover the interest payments for that year. £25 over a twelve month period equates to £300 and over a three year period totals £900. But there is an added effect because by staying in control of the interest payments, you won’t be charged further interest on top of the original interest and thus reduce your student loans debt overall.

7. Student Loans Debt & Lump Sum Payments

Should you receive any larger amounts of money either from a family member or through an insurance policy that has matured then consider making a lump sum payment on your student loans debt in order to stay in control and avoid it increasing. This can be both very satisfying and very effective.

8. Getting Help With Your Student Loans Debt

If you feel that your student loans debt is beginning to get out of control, then speak to your students union about getting some professional debt counselling. If you have already left University then why not visit your local citizens advice bureau and get some free independent advice on student loans debt. There are also some useful links available to help you with tackling student loans debt here;