It’s no secret that no generation has carried a burden of student loan debt quite as millennials have. This means that you need to be smart about managing your student loan debt so that it doesn’t prevent you from doing other important things financially, such as buying a home, and saving for retirement.

Know Your Debt

The first thing you need to do is look at exactly how much debt you have. This can be a much more difficult step for many people than it appears to be. Confronting the reality of debt can produce anxiety in many people, so if this sounds familiar, consider sitting down with a trusted friend or family member to go over the figures. This is a little bit like pulling a bandage off a wound. It may be painful in the moment, but it will be a relief to know the precise number even if it’s a scary one.

Understand Negative Amortization

Failing to understand this is one reason people get into trouble with their student loans. It seems reasonable to assume that making the minimum payment means you are being financially responsible.

Unfortunately, if the payment is small enough, it may not even cover the amount of interest that you accumulate in that month. This is how people can pay off loans for years and end up owing substantially more than they did originally. Once you understand how this works, you’re in a better position to consider different strategies for paying off your debt.

Refinancing

The good news about your student loans is that you are not necessarily trapped in any unfavorable repayment terms that accompanied your original loan. Refinancing can be an excellent way to deal with your debt, especially if that original loan had high-interest rates or if you have a variable rate loan, which means your interest rates are climbing. Refinancing into a new loan can help bring down the total amount you will have to pay and can aid in making a new plan to pay off the debt.

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Have a Repayment Strategy

Your next step is to learn how to live a savers lifestyle and make a realistic repayment plan. Set a goal for when you want to have the total paid off, and figure out how much you need to send in each month in order to reach that goal. Pay attention to the interest and how it will affect your plan. You may need to create a budget and look for ways to spend less money.

Discretionary spending, such as meals out and entertainment, may be one way to cut back, but you could also look at ways to save even more, such as getting a roommate or moving to a cheaper place to live. Stick to your schedule, and reward yourself when you reach certain goals.

Your Overall Financial Strategy

There is an important point that you shouldn’t lose sight of in this. While it is important to pay down student loans aggressively so that you aren’t overwhelmed with interest and to reduce your overall debt load, it shouldn’t be to the exclusion of all your other financial goals. You may want to continue contributing to your employer’s retirement account. Above all, it’s important to have a plan that is compatible with your overall financial strategy.