Your Student Loan Choice at 18: How it Impacts Major Life Decisions in Your 20s and 30s

By Anna Baluch | Published on March 9, 2026

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Due to the high costs of higher education, student loans have become the norm. While these financial tools can set you up for a successful career and future, they may also have a negative impact on major life decisions.

In fact, the latest Gallup Lumina Foundation Cost of College revealed that 71% of student loan borrowers have delayed milestones, such as buying a house or tying the knot. Fortunately, there are strategies you can take to mitigate the consequences of student loans on your future and increase the chances of a happy, financially secure life ahead.

Why student loans delay life milestones

When you graduate from college with massive student loan debt, you’ll likely lack the disposable income you need to enjoy your ideal lifestyle and simultaneously save for other financial goals. Depending on your situation, your student loan payment¹ may eat up a large portion of your monthly earnings, especially if you’re earning an entry-level income or choose a lower paying career.

Whether you hope to become a homeowner, move out of your parent’s house, start a family, travel the world, launch your own business, or retire someday, you may find it challenging to meet these financial goals if you borrowed a significant amount of money to cover your education. This is particularly true if you have a higher interest rate that increases your overall loan costs.

How to minimize your student loan costs

Not only can delaying or even avoiding life milestones hinder your quality of life, it may also take a toll on your long-term financial security. With these tips, however, you can keep your student loan costs down and in turn mitigate their negative impacts on your future.

Maximize free money

Fortunately, you can earn free money for college, often in the form of scholarships and grants.

Understand the difference between federal loans and private loans

Federal student loans and private student loans are not created equal. Compared to private loans, federal loans usually have lower interest rates. Also, rates on federal student loans are always fixed, meaning that stay the same over the duration of the loan.

Private student loans², on the other hand, may come with higher rates, which can be fixed or variable. Since variable rates might go up and down based on market conditions, your payments may increase or decrease as well. Also, unlike federal loans, private loans consider your credit. If you don’t have the best credit, you may have to settle for higher rates than someone with good or excellent credit.

In addition, the government pays for interest on subsidized federal loans while you’re still in school, saving you money on interest. Subsidized loans are not an option through private lenders.

Focus on lower interest rates

A lower interest rate can save you a substantial amount of money on your student loans. That’s why it’s important to shop around and explore rates from different lenders. You may also want to refinance at some point if your credit situation has improved or market rates have gone down. Through refinancing, you may lock in a better rate and more favorable terms³. With Earnest, you can refinance your loans with zero fees and customize your payments to meet your particular needs.

Pay more than the minimum or make bi-weekly payments

The more you pay towards your student loans early on, the less you’ll spend on interest. While you might need to pick up a side hustle or part-time job to take advantage of this approach, it may be worthwhile as it can help you repay your student loan debt faster. In addition to paying more than the minimum, you can make payments every two weeks instead of once a month.

Apply windfalls toward your student loans

Financial windfalls are unexpected lump sums of money. If a family member gives you some cash for your birthday or your boss rewards your hard work with a bonus, it’s a good idea to use the funds to repay your student loans. While it might be tempting to splurge on a new pair of shoes or go on vacation, making smart use of your windfalls can do wonders for your financial future.

Work with a financial advisor

If you’re feeling overwhelmed about your student loan debt and want some guidance on the best way to pay it down sooner rather than later while contributing to other financial goals, a financial counselor may come in handy. Fortunately, low-cost advisors are available through non-profit organizations such as Student Loan Borrower Assistance and Student Loan Advisors (TISLA). An AI advisor is also worth exploring.

Earnest can help you work toward a secure future

With Earnest, you can lock in a competitive interest rate and flexible terms that work well for your unique budget and allow you to focus on your life milestones. To find out what kind of rates you may be eligible for, get a free rate check today. It takes about two minutes and won’t hurt your credit score.

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About the Author

Anna Baluch

Anna Baluch is a freelance finance writer from Cleveland, OH. She enjoys writing content that helps people from all walks of life make good financial decisions. Her areas of expertise include student loans, refinancing, mortgages, personal loans, budgeting, and debt management.

Disclaimer

Disclaimer: This blog post provides personal finance educational information, and it is not intended to provide legal, financial, or tax advice.