How to pay off student loans fast in 2025 | Earnest

How to pay off student loans fast

By Kat Tretina | Published on February 5, 2026

)

TL;DR

When you first graduate from college, debt freedom can feel like a far-off pipe dream. But what if we told you it’s possible to pay off student loans in just a couple of years?

College these days is expensive. The average undergraduate student takes out almost $40,000 in student loans just to cover their undergraduate education. The average medical student takes out even more, often surpassing the six-figure mark to get a doctoral degree. If you got saddled with high interest rates on your loans, those numbers can quickly balloon.

But if you bring in a decent income, dramatically trim your living expenses, and make a plan to pay down your loans aggressively, you could dig yourself out of debt. Small, consistent strategies are the key to paying off student loan debt fast. Here’s a case study to illustrate how one recent grad utilized them to do that just.

Case Study: How Becky ended up with $98k in student loan debt

Like many high school students, Becky Blake dreamed of going to college away from home to enjoy her independence. Despite her parents encouraging her to take advantage of in-state tuition, she decided to go to a private, out-of-state university.

It was a pricier school, which means Becky graduated with $98,400 in student loan debt. Worse, some of her financial aid came with high interest rates, which meant that number was only going to grow.

Becky had applied for federal student aid on her own. However, the federal government limits how much undergraduate borrowers can take out in Direct Subsidized and Subsidized Loans each year, and Becky needed more money to cover her education.

Many students use private student loans to fill in funding gaps. But in this case, Becky’s parents applied for a federal option, Parent PLUS Loans, which Becky agreed to repay herself.

The catch was that Parent PLUS Loans tend to have the highest interest rates of any federal student loan. In this case, Becky’s parents’ rates were as high as 9.08%, causing the loan balance to grow rapidly.

“I was going to end up paying five figures in interest over the length of the loan,” Becky said. She wanted to do everything she could to minimize that number, and to become debt-free as fast as possible.

By coming up with an aggressive debt repayment plan, she was able to pay off a good portion of her student loans — approximately $68,000 — in just under two years. While Becky only had federal student debt, her approach will work for private loans, as well. Here’s how she made it happen.

When Becky realized she had to make a change

It wasn’t until Becky sat down and reviewed her loan terms that she realized she needed to accelerate her student loan repayment if she wanted to be debt-free any time soon.

“I wanted to rip the Band-Aid off and get rid of the bulk of the loans that were going to cost me the most money in the long run,” she said. Becky also decided that she wanted to retire early. But to do that, she’d have to pay off her debt so she could focus on investing and growing her money. And the faster she paid off her loans, the more money she’d save.

“If I waited, the student loan interest was just going to accrue, and it would ultimately take me longer to pay off,” she said.

How did Becky pay off her student loans fast?

Becky found answers to these questions and used certain strategies to tackle her debt and pay down her student loans fast.

When does the debt avalanche method make sense for student loans?

Most student borrowers have a handful of different loans with different interest rates. To save the most money, it’s best to prioritize paying off the higher-interest loans first to nip interest accrual in the bud.

In this case, Becky had a mix of different federal loans: Direct Unsubsidized, Direct Subsidized, and Parent PLUS Loans. The Unsubsidized and Subsidized Loans had interest rates as low as 6.53% — much lower than the Parent PLUS Loans.

To pay off her debt as quickly as possible, Becky used the debt avalanche method strategy. Here’s what she did:

By tackling the more expensive debt first, she was able to cut down on interest charges and save money over the life of her loans.

Why is refinancing high-interest debt a good idea when paying off student loans?

Becky realized her high interest rates would make it nearly impossible to stay ahead of her rising debt. She also knew she had a way to lower those interest rates: student loan refinancing.

What is student loan refinancing?

Student loan refinancing involves bundling several existing loans into a single new loan with new terms. You can refinance federal loans, private loans, or some mix of the two. When you refinance through a private lender (as opposed to doing “student loan consolidation” through the U.S. Department of Education), the lender takes a close look at your personal finances and adjusts your rate accordingly.

That means that if you have a better job or a higher credit score now than when you originated your loans, the lender will likely offer you a lower interest rate on your new loan. That’s because you’re considered a lower-risk borrower now than you were before.

Refinancing your student loans helps lower your costs and shorten your repayment term, both of which can lead to a faster payoff.

Keep in mind that while refinancing may help you pay off your student loans faster, it comes with some tradeoffs. For example, if you have federal loans, refinancing will eliminate federal protections, such as student loan forgiveness or income-driven repayment plans. It’s up to you to weigh the pros and cons of this strategy to determine if it’s worth pursuing.

How does the refinancing process work?

“What I decided to do was refinance all my high-interest loans, which I counted as anything with a 8% interest rate or above,” Becky said. Her parents helped her apply to refinance her high-interest loans through a private lender, and she was able to qualify for a 3.94% interest rate on that debt — a significant improvement. Thanks to student loan refinancing, a higher proportion of her monthly payment started going toward the principal balance of this new loan instead of just the interest.

Is a student loan refinance right for me?

Refinancing is especially useful for student loan borrowers who took out their original loans when interest rates were high or when their personal credit score was low. If your financial situation has improved since you took out your loans — or if you know national interest rates are lower now — it might be time to consider refinancing.

Student loan refinancing has perks aside from just lowering your interest rate. Because you’re getting a new loan, you may also be able to secure more favorable loan repayment options. Refinancing can allow you to switch from a variable to a fixed interest rate, lower your monthly payment, release a cosigner, or change the length of your repayment period. You can also switch to a new loan servicer that offers better borrower protections, like deferment or other hardship options.

Why is student loan refinancing a smart idea?

If you meet the eligibility requirements for student loan refinancing, you may be able to:

When does student loan refinancing not make sense?

All that said, refinancing isn’t right for everyone. Here are a few caveats to consider.

How does reducing expenses make it easier to pay off student loans?

After graduating from college, Becky continued living on a college student’s budget.

“I didn’t change my lifestyle at all after college,” she said. “So I essentially didn’t spend money on anything like clothing or going out to eat — what I would consider discretionary categories — because my whole philosophy is spending based on your goals and values.”

Because she lived in a high-cost area, she also lived with her parents for nine months.

“It was really humbling that this decision I made to have four years as an independent adult resulted in another period of my life where I had to live with my parents and be dependent,” she said. “That was kind of tough on my ego. But ultimately, it was very helpful for my financial goals.”

Can a side hustle help pay off student loans faster?

Becky did get a job right out of college as a consultant. Her starting salary was $65,224 — a solid income for a new graduate. But because she wanted to pay off her debt as quickly as possible, Becky focused on boosting her income so she could make extra payments.

“I got a part-time job as a public educator,” she said. “And I got into rewards points, mostly cashback rewards from credit cards and banks, to make more money.”

By keeping her living expenses low, refinancing her parent loans and other high-interest debt, and working a side gig, Becky was able to put as much as $2,500 extra toward her loan payments every month.

In under two years, she was able to pay off approximately $68,000 of her high-interest loans. By paying off her loans early, she was able to save about $24,000 in interest charges — the amount she would have paid if she’d stuck with her original standard repayment plan.

What are some more ways to pay off student loans fast?

Becky’s approach showcases some of the best strategies for getting debt-free fast. However, if you don’t have the option to live with a relative or take on a side hustle, there are other options out there. Here are eight more ways to pay off student loans fast.

1. How can you organize your student loan debt and design a repayment plan for a faster payoff?

If you’re overwhelmed by their debt and unsure where to begin, it can be helpful to face the hard facts right away.

“Make sure you collect all your debts and organize them, whether that’s on a spreadsheet or just on a piece of paper,” Becky said. “Know how much you owe, what the interest rates are, and what your minimum payments are. It’s scary to do. But once you have it all in one place, you can make a plan and figure out what direction you want to attack it from.”

If you’re not sure how much you owe, your first step is to track down your outstanding debt online. For private loans and other debt, like credit card debt, start by pulling your credit report from annualcreditreport.com (this won’t affect your credit score).

If you have federal student loan debt, you can either log into your studentaid.gov account to figure out how much you owe, or look up your debt using the National Student Loan Data System.

2. Should you pay more than the minimum payment if you want to repay your student loans fast?

Your “minimum payment” is the amount you have to pay each month to avoid defaulting on your student loans. For federal loans, this is generally $50 on the standard plan. For private loans, your minimum will vary, but it should be visible on your bill. (If you can’t find it, contact your loan servicer.)

For most student loans, the minimum payment is largely composed of interest and fees. That means only a small fraction of your money is actually going toward paying down the principal, or the actual amount you borrowed.

And the longer you take to pay off the principal, the longer those interest and fees have to pile up. Over time, you could pay thousands of dollars, as in Becky’s case, in interest without appreciably lowering your actual debt.

However, when you pay more than the minimum due, the extra goes straight toward the principal. That can help you pay off student loans fast and save money over the life of the loan.

3. How do extra payments help reduce student loan debt and make it faster to pay off?

You don’t have to commit to a bigger monthly payment every month to pay off your student loan debt faster. You can also make additional payments whenever you have any “found money” to put toward your debt. “Found money” refers to gifts, unexpected tax refunds, or other financial windfalls. Instead of using that extra cash to splurge, put it toward your student loan balance.

4. Can applying for loan forgiveness or repayment programs speed up student loan repayment?

Some federal student borrowers may qualify for student loan forgiveness programs. If you’re eligible, these programs can help you dramatically decrease the amount you owe. Employees in certain careers may also be eligible for repayment assistance. Here are the most common pathways to loan forgiveness and repayment:

If you can’t currently afford your federal student loan payments or are in danger of defaulting, you may also qualify for an income-driven repayment plan. Keep in mind that this may forgive some of your debt, but it will extend your loan term to 20 to 25 years. If you can afford to pay down your loans more aggressively and get out of debt faster, an income-driven repayment plan might not be your best option.

5. How can interest rate discounts help pay off student loans fast?

Some lenders offer discounts for setting up automatic payments from your bank account. For Earnest, for example, this discount comes in the form of a 0.25% interest rate reduction. While minimal, an auto-pay discount can help limit the pace at which your student loan debt grows, and make that debt a little easier to pay off.

Other discounts are harder to find, but it’s worth asking your student loan servicer if they’re able to offer a slight interest rate reduction for making a high grade-point average, making a certain number of on-time payments, or referring other customers. Contact your loan servicer and ask if there are any discount options available.

6. Are there tax deductions and credits that can speed up student loan repayment?

If you’re currently paying tuition to either an undergraduate or a graduate program, you may qualify for a tax deduction.

While tax credits are usually more beneficial than deductions, both reduce the amount of money you have to pay in taxes. That leaves you with a bigger tax refund, and therefore more disposable income to put toward your student loans each month. This can help you pay down your student loan balance more aggressively and get out of debt faster.

7. How can biweekly payments help pay off student loans faster?

If you can, switch from automatic monthly payments to automatic biweekly payments. When you pay biweekly, you end up making 13 payments per year instead of 12. That helps you pay down your student loan balance faster without even thinking about it.

8. Can employer-based student loan repayment assistance make it easier to pay off student loans fast?

A growing number of companies, including certain hospitals or medical facilities, offer student loan assistance programs as an employee perk, both to attract new employees and to retain existing ones. Before you take a new job, consider any repayment programs as an important part of your benefits package. If you already have an employer, ask them if they have a program in place that you can qualify for.

See how much you could save with Earnest

Student loan debt can seem insurmountable, but by making a plan and sticking to it, you can get on top of your debt and fast-track your journey to financial freedom.

As Becky’s story illustrates, student loan refinancing can be an invaluable tool in reducing your interest rate and attacking your debt head-on. When you refinance with Earnest, you can customize your loan term, release a cosigner, and sign up for automatic biweekly payments. On top of that, Earnest never charges fees for paying early or extra.

Try plugging your student loan amount and interest rates into Earnest’s refinancing calculator to see how much you could save. Then, check your interest rate using our free rate-checker tool. There’s no commitment required, and it won’t affect your credit score.