Friday, January 20, 2017, PM | Leave Comment
You’ve graduated college, landed a job you really like and you’re living in your dream city.
Or, even if it’s not where you thought you’d live, the job you fell in love with requires you to move to a major city.
In both scenarios, you might be wondering if you’ve made the right decision. Sure, it’s likely a smart move for your career, but can you really afford the expensive rent while trying to pay down your student loan debt?
If you live in a city with a high cost of living after graduation, here are six suggestions that can help you more easily balance your loan and living expenses:
Get a roommate
If you live alone in a major city, you may be shelling out 40 percent or more of your annual income in rent. With your other financial responsibilities – like student loan payments, utilities, food and transportation costs, car payments, insurance and more – that may not be manageable.
Getting a roommate can help you cut those rent payments in half, allowing you to apply more money toward paying down your student debt.
While you may sacrifice a little privacy, having a roommate has its advantages – like enhancing your social life, dividing chores, and ensuring someone can pick up your mail, water your plants or feed the cat while you’re away on a business trip.
Rent out extra space on Airbnb
Not sure if you want a roommate full-time? Consider short-term roommates by renting your space on Airbnb as frequently as you want.
As an Airbnb host, it’s important to remember that you do need to meet certain hospitality standards and that your city may have its own regulations for this type of business.
Do your research, find out what insurance you and your renters may need and be sure to meet with and get references from potential roommates before you agree to let them stay.
Ditch your car
If you live in a city with reliable and convenient public transportation that can get you to and from work, errands and social engagements, consider ditching your car.
Why spend money on car payments, insurance, gas and maintenance for a vehicle you barely drive? And you’ll avoid the headache of trying to find (or pay a high premium for) parking in a crowded city.
When you do need to venture outside the city, investigate the rates for transportation services like Uber and Lyft, consider a car sharing service or rent a car on a temporary basis.
Saying goodbye to your car means you’ll have more money to contribute to those monthly loan payments – saving you interest in the long-term. If you absolutely have to own a car, do your homework first.
Learn if your career offers student loan forgiveness
Some career paths now come with the prospect of loan forgiveness – an important perk for young workers carrying tens of thousands of dollars in student loan debt.
Though these jobs may start on the lower end of the salary range, require a significant time commitment or carry more risk than other careers, you may be eligible for a federal student loan forgiveness program to pay off some or all of the debt you’re carrying.
Occupations that may be eligible for loan forgiveness include:
Federal agency positions
Public service careers (family and child services employees, law enforcement and correctional officers, public defenders, etc.)
Medical careers (doctors and nurses)
Some volunteer organization positions
See if your employer offers to help pay off student loans
Several best-in-class employers, like PricewaterhouseCoopers, Aetna and Staples, already offer employer-sponsored student loan repayment programs as part of their benefits packages.
Your company may offer something similar. Talk to your company’s human resources representative or business manager about loan repayment opportunities.
Take advantage of contests and awards offered by large research companies
Spending an hour or so per week entering contests or answering surveys is a low-effort way to win extra money to put toward your student loan debt.
These typically require 10 to 15 minutes, during which you’ll answer simple, straightforward questions. The Penny Hoarder recently released a list of the best survey sites that will pay you.
Strike your best balance
Facing new financial responsibilities and a monthly commitment to pay off your college education may seem daunting, especially if you live in an expensive city.
But there are smart steps you can take to ensure you make those payments and successfully manage all your expenses.
You can learn more about paying down your debt without sacrificing your lifestyle by downloading our guide “11 Strategies to Paying Off Your Student Loans Faster”.
These habits can make you successful for a lifetime.
Mike Brown, National Student Loan Union Knowledge Director
Mike is responsible for the editorial and marketing direction of National Student Loan Union. He has a history of helping people thru his educational background – first as a teacher at the Pennsylvania State University and then through 15 years of development and marketing of education programs.