Paying off student loans ahead of schedule is a worthy goal. For most people dealing with big monthly payments, being free of student debt sooner would be a welcome relief.
Your ability to repay student loans, however, is limited by your discretionary income (the portion of your paycheck that’s left over after covering basic living expenses). Unless – you figure out how to earn more.
So how do you get more money to pay off student loans?
The discretionary income equation
One place is in your own budget, by cutting back and spending less to put more dollars towards debt.
But this approach has a limit: your costs of living. You can only reduce costs so far before you run up against the necessities of life, from rent to groceries to utilities.
While there’s a minimum amount you can live on, there’s no maximum on your earning potential. That’s the other end of the equation: your income. The more you earn, the more money you’ll have to work with and the quicker you can achieve your goal of paying down student debt.
Target student loans with a side hustle
One of the simplest ways to get more money coming in is to create a new source of income with a side hustle. This side hustle can be any work or gig you have outside of your regular job that generates extra income.
A side hustle has a double benefit to help you pay off student loans. First, it helps you have more money to put toward loans today. Second, an extra income source makes you more financially secure and prepared for tomorrow.
With more money come in, you’ll be empowered to work toward goals like paying off student debt more quickly and efficiently.
By putting more money toward student loans, you’ll save thousands on interest and shave months or even years off your repayment. And the sooner you’re free of debt, the sooner you can use that money to build wealth and accomplish what’s important to you.
More income sources = greater financial security
Starting up a side gig can also give you more flexibility and security as you add new income streams.
If you’re laid off or get hours cut for one job, you’ll still have money coming in from other sources. Should some unexpected expense pop up, you’ll also have the flexibility to ramp up your side gig to make more to cover them.
This additional income helps you stay up on financial demands, like student loan payments, no matter what. So a side hustle is an added layer of protection against student debt pitfalls like missed payments, delinquency, and even default.
How to start up a side hustle
Chances are you’ve probably had a side hustle at some point in your life – maybe babysitting, house or pet sitting, doing yard work, or performing other odd jobs for neighbors.
Your opportunities to earn more through a side hustle are even greater today. You have more skills, experience, and education. You can likely qualify for a greater number of side jobs and for higher-paying ones, too.
Here are a few tips to identify earning opportunities and get a side hustle going.
Use your unique skills or knowledge
You’ll almost always earn more using your unique knowledge and abilities than taking low-skill jobs. Take some time to think about what you are better at than most people, and how you could capitalize on that to earn some money.
These could be talents that come naturally to you, knowledge you’ve acquired in your studies, or even a skill you typically think of as a hobby. It might also help to think of favors you’re commonly asked for, whether it’s a batch of your famous chocolate chip cookies or IT help.
Figure out what you want
In addition to figuring out what value you can offer, you’ll need to know what value you’re expecting from a side hustle. It’s important to be clear on your goals and constraints from the get-go, and to use these to guide your decisions.
Decide how much time you can devote to it, what kind of initial investments you’re willing to make, and how much you’re hoping or expecting to make. Then weigh any opportunities against these considerations to find which are the best fit for your goals.
Tap your network
Once you’re ready to get started on a side hustle, let your social circles know that you’re up for hire. Send emails and post social media updates with the news. Make sure to request referrals, too.
On top of reaching out to people you know personally, you can also turn to other platforms to generate work. Create listings on local job boards, or put up a flier at a public space. You can also tap sites like TaskRabbit, Upwork, Fiverr, or Elance for freelancing opportunities.
As you work toward making more with a side hustle, make sure to keep your eyes on the prize: being student loan debt free. This will help you stay motivated to keep hustling and earning. And you’ll need to stay disciplined to put that extra money toward debt. The reward is worth it.
Interested in refinancing your student loans?Here are the top 6 lenders of 2018!
|Lender||Rates (APR)||Eligible Degrees||More Info|
|2.58% - 7.25%||Undergrad & Graduate||Visit Sofi|
|2.99% - 6.99%||Undergrad & Graduate||Visit Laurel Road|
|2.57% - 6.32%||Undergrad & Graduate||Visit Earnest|
|2.57% - 6.49%||Undergrad & Graduate||Visit Commonbond|
|2.56% - 7.82%||Undergrad & Graduate||Visit Lendkey|
|3.11% - 8.46%1||Undergrad & Graduate||Visit Citizens|