Experts: How To Pay Off Six Figures in Student Loans

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The total amount of student loan debt in the United States is approximately $1.77 trillion. Considering millions of Americans have education-related debt, this number isn’t too surprising. In fact, according to a recent study, the average borrower owes roughly $37,717 in federal student loans and $40,505 in private student loans.

Over the past few years, there has been a lot of discussion about student loan debt repayment and forgiveness. Since President Biden took office, the Biden-Harris Administration has forgiven over $116.6 billion in student loans. Even now, the Department of Education continues to try to find ways to forgive student debt, particularly for those on income-driven repayment plans.

This is good news for millions of borrowers, but it might not be enough for those who either don’t qualify for student loan forgiveness or owe six figures in education-related debt. And with student loan payments resuming in October 2023, many borrowers are concerned about how they’ll manage their debts.

When the pause on student loan repayment ends, many borrowers worry about what that’ll mean for their financial situation. In a recent GOBankingRates survey, around 14% of respondents said they think they’ll no longer be able to pay all of their other bills. Nearly 10% of people said they expect to go into more debt to pay for everything, while almost 8% indicated they’ll probably have to skip some of their student loan payments.

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Having significant amounts of student loan debt — say, six figures — can feel overwhelming. Here are some approaches you can take to better manage your debt and start paying it back, according to experts.

Look Into Loan Assistance Programs

Various loan assistance and loan forgiveness programs exist, particularly for those working in specific industries. These programs may help with all or a portion of your debt.

“Loan assistance programs are relatively common in certain careers (doctor, nurse, dentist, pharmacist, lawyer, teacher, veterinarian),” said Robert Humann, chief revenue officer at Credible. “These typically require two-plus years of service in a low-income facility/high-need community in exchange for partial loan repayment.”

Federal student loan borrowers also might qualify for student loan forgiveness.

“Consider federal forgiveness programs such as public service loan forgiveness for social workers and [government] employees or teacher loan forgiveness,” added Humann.

Switch to a New Repayment Plan

If you have federal student loans, you might want to switch to a different repayment plan. Depending on the plan, you could end up with more reasonable monthly payments or a better repayment term. Certain plans work based on your income, meaning you can pay what you can afford.

Remember, federal student loans may be eligible for student loan forgiveness. Ask yourself whether you want to pay off your debt or wait for it to be discharged.

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“With the new REPAYE/SAVE plan, student loans are forgiven in 20 years (or less) for undergraduate loans and 25 years for graduate loans,” said Jay Zigmont, Ph.D., CFP, founder of Childfree Wealth. “That may sound like a long time, but you may be able to get credit for the time you have already had the loans as long as they were not on in-school forbearance.

“If you are going to wait for forgiveness,” he added, “then enrolling in the new SAVE plan is a must. The new SAVE plan lowers your payment and stops interest from accruing over your minimum payment. It stops the loan from growing.

“If, on the other hand, you plan on paying off the student loans before forgiveness, SAVE may still help you to lower your required payment, but then you will have to pay extra each month.”

Pay More Than the Minimum

If money’s tight, it can be hard to pay more than the minimum. But if you can manage it, it could save you money and get you out of debt sooner.

Paying more than the minimum “can significantly reduce the total interest paid over the life of the loan,” said James Allen, CPA, CFP, CFEI and the founder of “Additionally, consider using any extra income, such as bonuses or tax refunds, to make lump-sum payments on your loans. It’s like chipping away at a mountain with a pickaxe — every little bit helps.”

Refinance Your Student Loans

Refinancing your student loans could make it easier to manage monthly payments, especially if you qualify for a lower interest rate. If you refinance federal student loans, they will no longer qualify for federal forgiveness programs, however.

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“One approach is to refinance your loans, which can potentially lower your interest rate and monthly payments,” Allen said. “Companies like SoFi, Credible and Splash Financial offer competitive refinancing options.”

Make a Long-Term Plan

“Earlier in my career, I found myself in six-figure debt, so I understand the burden of financial liabilities like student loans firsthand,” said Lisa Fischer, Mission Lane’s chief lending and growth officer. “But being in debt doesn’t mean you can’t enjoy your life; you just need to be mindful. To start, ask as many questions as possible of your lender, parents and advisors to understand your financial situation, like how much debt you can pay off each month while meeting other financial obligations and still enjoying life. They may also help uncover options for relief that you may not have been aware of.”

Once you have a plan, Fischer suggests tracking your finances.

“Recording everything not only helps hold yourself accountable for how you spend but also encourages you to regularly save your money,” she said. “Tracking finances on a monthly basis is something I started when I was building myself out of debt, and I’ve found it helpful to this day, even after my financial situation has improved.”

Budget and Prioritize Your Financial Responsibilities

“Balancing student loan payments with other financial responsibilities can feel like trying to navigate a ship through a stormy sea, where every wave is a new bill and the lighthouse of financial stability seems miles away,” Allen said. “But it’s not impossible.”

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Allen suggests creating a budget that includes all of your debt obligations — from student loans to rent to groceries. If your income is consistent, automate your payments so you don’t miss any due dates. Or consolidate your student loans to make it easier to manage payments.

Use the Debt Avalanche or Debt Snowball Repayment Method

When it comes to managing multiple financial obligations and large amounts of student debt, you may want to consider using a tried-and-true debt payoff method. Two popular options are the debt avalanche and the debt snowball methods.

With the debt snowball method, Humann said, you “focus on the loan with [the] smallest balance first and make extra payments until it’s paid off. Then, move to the next-smallest balance, etc. This won’t save money on interest, but you can get quick wins for motivation.”

With the debt avalanche method, Humann explained, you “focus on the loan with largest interest rate first and make extra payments until it’s paid off. Then, move to the next-largest rate, etc. This can minimize interest costs and help you prioritize your debts.”

Timeline for Repaying Six Figures in Student Loans

“The timeline for paying off six-figure student loan debt varies based on factors such as income, interest rate and personal budget,” Allen said. “However, it’s not uncommon for repayment plans to span 10 to 20 years.”

Doug Ornstein, CFA, senior integrated solutions manager at TIAA Wealth Management, offered the following example based on a repayment timeline of 15 to 20 years:

“If you start with $100,000 in debt at 6% interest rates, paying $500 per month should have the debt paid off in about 18 years. The size of your monthly payments really matters though; a $750 monthly payment holding all else equal means paying the whole thing off in 12 years, saving over $20,000 in interest paid.”

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Allen added, “It’s like running a marathon, not a sprint. You need to pace yourself and keep your eyes on the finish line, knowing that every step, no matter how small, brings you closer to your goal.”

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