Tips for Paying Off Student Loans

Our 2016 survey offers eye-opening insights into recent graduates’ experiences with their student loans. Those surveyed report owing an average of over $41,000 in student loans and 43% don’t know how many years they have left to pay off student loans.* Mapping out your student loan repayments will give you a clearer picture of your financial future and potentially help save some money, too. Here are four tips to help you plan to pay off your student loans and cut costs along the way:

1. Know what you owe

Understanding your payment responsibilities is crucial to maintaining credit and balancing your personal budget. Create a spreadsheet of all your student loans and include columns for the monthly payment, principal balance and interest rate of each loan. You can find information on all your federal student loans by creating an account on the National Student Loan Data System (NSLDS) website. Next, gather your private student loan information by reviewing your credit report, which will contain the balance, rate and repayment status reported by each lender. This will give you a consolidated view of all your student loan debt and serve as a great reference if you decide to refinance or consolidate in the future.

2. Pay it forward

It’s worth mentioning that making payments ahead of schedule is the best way to lower your overall cost of borrowing. Interest is charged throughout the life of a loan, so by making additional payments you shorten the life of the loan and the amount of time interest is charged. You may be able apply payments directly to the principal balance, but each lender is different, so ask about your lender’s policy before submitting a payment.

3. Interest rate reductions

Take advantage of any and all interest rate discounts available to you. Many lenders offer interest rate reductions on student loans for setting up automatic payments, being a customer and other factors. An interest rate discount may not seem like a lot, but every bit helps. For example, making regular payments on a $10,000 loan over 10 years with a fixed interest rate of 6.25% APR will result in a total amount paid of $13,334. With an interest rate discount of 0.25 percentage points, the same loan will result in a total cost of $13,190 – saving you $144 over the life of the loan. Ask your lender if there are any available rate reductions and what’s required to get the discount.

4. Refinance or consolidate student loans

There are many reasons you may want to consider student loan refinance or consolidation, but most often, borrowers seek to lower monthly payments and consolidate multiple loans to simplify finances. Instead of making payments to several different lenders each month, you can, for example, combine multiple federal and private student loans into one monthly payment using the Citizens Bank Education Refinance Loan®. Always consider the features and benefits of your existing loans and make sure you’re comfortable replacing those with the features of your new loan. For more on the factors to consider before refinancing or consolidating your student loans check out “Should I Refinance My Student Loans?


These tips are important to consider when you’re figuring out how to pay back student loans. Whether you want to buy a home, start a family, or save for a vacation, mapping out your repayment will help you maintain a positive credit history and get you closer to meeting your financial goals. For more information about the Education Refinance Loan and answers to all of your student loan questions, call 1-800-411-0266 to speak with one of our Student Lending Specialists.

Helpful Tools & Information
Refinance Loan Glossary An easy-to-use guide for the terms you’ll encounter in the student loan process.
FAQs Answers to frequently asked questions about the Education Refinance Loan.
Loan Refinance Estimator Use our Refinance Estimator to see how much you could potentially save.