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5 Tips for Tackling Student Loan Debt

Maybe your plan was to work from home all along, or maybe your current career choice was never on your mind in the days of textbooks and lecture halls. Whatever the case is, there are steps you can take to get yourself debt-free, including flexible payment options, taking advantage of tax deductions, asking for a deferment, and not being afraid of small payments.
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Maybe you're like me and had no idea going through college that you would one day own your own work-from-home business. Or perhaps that was the plan all along. Maybe you were even a work-from-home mom as you finished your degree. Regardless, those student loan bills are rather scary when you aren't sure exactly how much your next paycheck will be. Ready to tackle that fear and take another step towards being debt-free? Here are five tips to tackling those student loans as a work-from-home mom.

Talk to your lender about flexible payment options. Student loans may be scary, but they do have a variety of different repayment options. Have a chat with your lender to make sure the payment plan you are using is the best suited to your current needs. Here are a few of the options that come in handy when you are self-employed, courtesy of Financial Web:

  • Biweekly repayment -- Instead of paying the same amount on a loan every month, switching to a bi-weekly payment plan means you'll make payments every two weeks. There's a few advantages to this option. One, the payments are smaller (since there are two) and easier to manage. But you'll actually end up making one more payment a year this way than you would paying by month, so you can actually pay off your loans sooner.
  • Income-based or Income-contingent -- With an income-based repayment plan, your lender will look at your income and calculate a payment for you based on how much you make, which can be a good option if you are self-employed. An income-contingent plan is similar, only it also takes into consideration how many dependents you have.
  • Income-sensitive repayment -- With this plan, you pay a certain percentage of your income every month. It can come in handy when your income isn't consistent, but it may also take you longer to pay off the loan.

Every lender is different, so it's a good idea to chat with a representative to find the best repayment plan for your unique situation.

Work towards establishing an emergency fund. When you work from home, it's a good idea to have some income saved for periods when you aren't earning as much. Many recommend having three months of income in savings for this reason. Cut back on what you are spending and put the difference into a savings account. Then, to pay off student loans early, once you've reached your target amount in savings, add what you were previously putting into the emergency account on top of your usual loan payment.

Take advantage of tax deductions. Don't forget to tell your tax preparer about your student loans. The interest is tax deductible, according to Financial Web. If you receive a tax return, use it to help pay off your student loans early.

Don't be discouraged by small numbers. Every time you pay more than the minimum payment, you are taking steps towards paying your loan off early, even if it isn't very much. Simple things like skipping your morning coffee a few times a week or packing your lunch can save a few extra dollars and even little amounts add up over time. Round your payment up every month to make the payment easier--and even that little amount can make a difference over time.

Don't be embarrassed to ask for a deferment. If you haven't yet gotten your work from home business off the ground or are going through a rough patch and can't afford monthly student loan payments, don't be afraid to talk to your lender about a deferment. In a deferment, you won't earn any additional interest and payments can stop for up to a year. Sure, it will take you longer to pay off the loan, but you'll have some breathing room to start building up your income without paying penalties or extra interest.

When you work from home, paying off student loans will help give you more flexibility in your income. But with some work and understanding of how your loan works, student loans are manageable, even as a work-at-home mom.

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