Pay Off Student Loan Fast
If you’re based in New Zealand, you’ll be pleased to know that your student loan is interest free for life! That is, unless you decide to move abroad. If you spend much of the year outside of New Zealand, the government will likely classify you as being based overseas and your student loan will accrue interest.
Student loans can really put a damper on your financial freedom. When we finish school and venture into the world, outstanding student debt hanging over our heads is an unwelcome remembrance of our years of education. Paying off your student loans faster means you can start saving for your future.
Also, though student loans are interest free, they have a negative impact on your future ability to secure lending. As soon as you start earning, 12% of whatever you earn is meant to be used to repay your student loan, which is then taken into account by lenders as a debt repayment commitment – which ultimately reduces the amount you’re able to lend. If you’re working hard to get into your first home, or secure lending for your investment strategy, then this can be the difference between securing the lending, or not.
If you went to school outside of New Zealand or you have moved away, you may be accruing interest on your student loan. Whether you are accruing interest or not, the good news is that there are tried and tested methods to paying off your student loan fast. Get in touch with our experts at MyFuture today for your no obligation FREE Discovery Session to find out the best methods for you to get your student loan paid off in full prematurely.
Pay Off Your Student Loan
You can’t put a price on a good education and New Zealand’s education system is considered one of the best in the world. A good university education can set you up for your dream career which, in theory, will enable you to make regular repayments on your student loan while living the life you always dreamed of.
The money management dilemma a lot of us face once we’ve entered the workforce is having our student loan debt hanging over us when we want to move onwards and upwards, save for a house, take adventurous holidays, or plan on having a family.
If you’re wondering how you can pay off your student loan debt fast so you can focus on your next financial goal, our Qualified Financial Advisers have a wealth of experience in guiding you in the right direction.
How To Pay Off Your Student Loans Quickly
Student loan payment terms are usually based on your income, your job, and where you live, so everyone’s experience will differ. Kiwis living abroad will also accrue interest on their student loans. It’s important to keep this all in mind when figuring out your next moves.
Here are a few simple ways to get you started on repaying your student loan faster:
- Make additional payments if you can afford it. Making regular, larger payments means you will pay off your loan faster.
- Establish a college repayment fund where part of your salary is automatically transferred every month so you don’t forget to make the payment.
- Take up a part time job in college to start paying off your student loan early.
- Stick to a budget and understand your monthly cash flow so you can make informed decisions on your spending where needed.
Everyone’s situation varies when it comes to student loans and their repayments. Speak to one of our Qualified Financial Advisers today to gain a better understanding of your student loan, the best methods for you to repay it, and how to have peace of mind that you can put your university debts behind you.
Get Ahead With Quality Financial Advice
Can Student Loans Be Written Off In NZ?
In New Zealand, a student loan can only be written off if the customer dies or is declared bankrupt, meaning that your best option is to keep making payments and work to pay them off swiftly.
At the very least, take comfort in knowing your student loan debt will not fall to your next of kin should something happen to you.
What Happens If You Pay Off Your Student Loans Early?
We can all agree that paying off any loans is a huge weight off our shoulders. If you’ve paid off your student loans, congratulations!
You’re free to focus on your future. If you went to university and took out student loans overseas, or moved abroad from NZ since uni, then paying off your student loans early has a significant benefit of not having to pay accrued interest.
If you went to school in New Zealand, you will not accrue any interest on your student debt. But if you have the opportunity to pay off your loans early, doing so will give you the opportunity to use those funds in pursuit of your other financial goals.
So what’s the best way to get there? Speak to our Qualified Financial Advisers at MyFuture to develop a personalised financial plan so your student debt becomes a distant memory of your uni years.