Learning how to lower student loan payments can be a lifesaver if you’re struggling to afford your bills. Fortunately, you don’t have to be stuck with sky-high payments every month.

Here are nine strategies to reduce student loan payments or even repay your loans early.

How to lower student loan payments

1. Apply for an income-driven repayment plan
2. Sign up for a graduated repayment plan
3. Consider an extended repayment plan
4. Consolidate your loans
5. Move to another state
6. Enroll in automatic payments
7. Get help from your employer
8. Refinance your student loans
9. Search for repayment assistance
● Plus: Choosing student loan payment plans

1. Apply for an income-driven repayment plan

If you have federal student loans, you’re automatically enrolled in the standard repayment plan when you graduate. With this plan, your payments are fixed and divided over 10 years — but the monthly payments can be high.

Luckily, there are other student loan payment plans available. There are four income-driven repayment (IDR) plans, which base your payments on your income:

Under an IDR plan, the loan servicer extends your repayment term to 20 to 25 years while capping your monthly payment at a percentage of your discretionary income. Depending on your income, family size and loan balance, your payment could be as low as $0 a month.

As your situation changes, your payments will change, too. If your income decreases or increases, or if your family grows, your payment will be adjusted.

Although your payments can be significantly smaller with an IDR plan, you could pay more in interest over the life of the loan. But if you’re struggling to afford your payments, an IDR plan could give you some more breathing room in your budget as you build your career.

Use the federal loan simulator or our income-driven repayment calculators to find out how to lower student loan payments on each of these repayment plans.

2. Sign up for a graduated repayment plan

If you make too much money to qualify for a lower payment with an IDR plan but still can’t afford your payment for your federal loans, another option is to sign up for a graduated repayment plan.

Unlike IDR plans, which are based on your income and family size, payments under a graduated repayment plan start low and then gradually increase every two years. After 10 years of payments, your loans are paid off.

However, because the payments start out so low, you’ll pay more in interest over the length of your loan than you would with a standard repayment plan. Plus, your payments increase every two years, regardless of your income — as such, even if you have to take a lower-paying job, you’ll still have to make a larger monthly payment.

3. Consider an extended repayment plan

If you have more than $30,000 in federal direct loans, you might be eligible for an extended repayment plan. With this option, you’ll repay your loan over up to 25 years, and you can choose between fixed and graduated payments.

Because of the long term of this plan, your monthly payments will generally be lower than they would be under a standard repayment plan or graduated repayment plan. But it’s not dependent on your income, so it might be cheaper to sign up for an IDR plan instead.

Although your payments will be low under an extended repayment plan, you could end up paying more money than you borrowed because of interest charges over time.

4. Consolidate your loans

If you have multiple federal student loans, all with their own interest rates, repayment terms and minimum monthly payments, consolidating your debt with a direct consolidation loan might be a wise decision.

With a direct consolidation loan, you take out another federal loan for the total amount of all your old ones. You’ll now have just one monthly payment and one due date to manage.

Your interest rate will be the weighted average of your previous loans’ rates, so you may or may not get a lower rate. But you can sign up for an IDR plan after consolidating most of your direct loans and reduce your student loan payments that way — and have only one payment to remember rather than juggling several at once.

5. Move to another state

Moving might sound drastic, but where you live could impact your student loan repayment. Some states offer student loan repayment assistance programs and incentives to new residents, helping you pay off some or even all of your loans.

If you can qualify, student loan repayment programs could mean more money in your pocket. But before you pack your bags, make sure you consider other factors, such as your earning potential in the new state and the cost of living.

6. Enroll in automatic payments

Most lenders offer discounts for signing up for automatic payments. Connect your bank account, and you could qualify for a 0.25% rate discount. Although that might not sound significant, it could reduce how much you pay over time.

For example, say you had $30,000 in student loans at 7.00% interest rate. If you were on a standard repayment plan and qualified for the 0.25% discount, you’d save nearly $500 over 10 years.

7. Get help from your employer

To attract top talent, more and more employers are offering student loan repayment assistance. With many programs, employers match your payments on your loans, much like a 401(k) match. With their help, you could pay off the debt faster and save money.

Ask your human resources office if your company offers such a program.

8. Refinance your student loans

If you have private student loans, those loans won’t be eligible for federal alternative payment plans like IDR. If that’s the case, or if you have a mix of federal and private loans, another option to consider is refinancing your student loans.

With refinancing, you work with a private lender to take out a new loan for the amount of your current ones. The new loan will have different terms, including repayment term, interest rate and monthly payment. You could opt for a longer repayment term to reduce your student loan payments, and you might qualify for a lower rate that decreases your monthly payment, too.

For example, if you had $30,000 in student loans at 7.00% interest rate, you’d pay $348 a month under a 10-year payment plan. And you’d pay $11,799 in interest charges.

If you refinanced your loans and qualified for a 4.00% interest rate, your new monthly payment under a 15-year term would be $222. Plus, you’d repay just $9,943 in interest. Refinancing would save you nearly $1,900, despite having a longer loan term.

Not everyone can qualify for refinancing, though. To maximize your chances of getting approved for a loan, ask a friend or relative with good credit and a stable income to act as a cosigner on the loan. You should also keep in mind that refinancing your loans has some drawbacks, especially if you have federal loans.

If you decide that refinancing is for you, compare offers from multiple refinancing lenders to get the best rate for you.

9. Search for repayment assistance

It might sound too good to be true, but there are hundreds of legitimate student loan repayment assistance programs. Depending on your occupation and location, your state could provide thousands to help you repay your student loans.

To find out if you’re eligible, check out our database of repayment assistance programs.

Choosing student loan payment plans

If you’re wondering how to lower student loan payments, there are a variety of options from which to choose. Unfortunately, there can be a lot of confusion around what options are available for student loan borrowers. By using this guide, you can learn ways to confidently reduce your student loan payments and make them more manageable.

Before you choose a plan of action, understand what benefits you might give up and estimate how much extra interest you might pay over time. While lowering payments may feel like a quick win, it could also have long-term consequences. Choose wisely.

Rebecca Safier and Melanie Lockert contributed to this article.

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