Lingering debt has the potential to prevent you from maximizing your earnings. Specifically, hefty student loan payments can interfere in building an emergency financial cushion or saving for a down payment on a home. When these payments eat up a good portion of your paycheck, your standard of living can be impacted. Early student loan payoff is one option to consider to reduce these heft payments. However, before you go down this route, it’s important to look at the big financial picture.

For many college graduates with a steady income, taking ten plus years to pay off student loan debt is inconvenient. With payments spanning such a long time period, borrowers are forced to put the rest of their financial lives on hold. One way to prevent this is by paying off your student loan debt early. However, if you are seriously considering this option, refinancing your loans first may be a smart move.

Consider refinancing before early student loan payoff.

  • A student loan refinance typically offers a single lower interest rate relative to your existing loans. You can use this loan to pay off multiple higher-interest rate loans. The lower interest rate often results in a lower minimum monthly payment and reduces the total cost of the loan.
  • Student loan refinancing could result in a longer loan term.  With a longer repayment period, your required minimum monthly payment can be reduced, even if the interest rate reduction is less than you’d planned.
  • Lowering your payment by reducing the interest rate, or extending the repayment terms, can help protect your finances. If you experience an unexpected hiccup on your path to early student loan repayment, don’t fret. It’s important to remember you can make smaller monthly payments without experiencing negative consequences to your credit rating.
  • Refinancing your student loans could free up money to put toward an emergency savings account. You can funnel that extra cash into a savings account before moving full steam ahead with your early student loan payoff plan.
  • A student loan refinance allows you to potentially replace your high adjustable-rate loan with a low fixed-rate one. This can stabilize monthly payments and ensure that all your extra money is applied to the principal amount.
  • You may gain greater budgeting flexibility. If your income varies each month, you can adjust your student loan repayment plan to cater to your income variations.


Doubling your student loan payments is a sure-fire way to pay your debts off early. However, this is not a feasible option for many people. Luckily, there are other ways to shorten your repayment timeline, such as making biweekly payments on the refinanced loan. Some lenders will reduce your interest rate when you have these payments automatically deducted from your checking account.

Additionally, speaking with your employer is a great way to find student loan repayment assistance programs. Some companies offer employees student loan repayment assistance as a workplace benefit.

LendKey’s Resources

It only takes a few minutes to find out how refinancing might help with your plans to pay off your loan early. The less you have to repay, the sooner you can pay off your loans. LendKey can connect you with lenders who refinance private student loans with no origination fees and repayment terms as short as five years. Check your rate today and discover how much you can save!

*Refinancing federal student loans with private student loans may cause you to lose eligibility for specific federal benefits like Public Student Loan Forgiveness.

Please note that the information provided on this website is provided on a general basis and may not apply to your own specific individual needs, goals, financial position, experience, etc. LendKey does not guarantee that the information provided on any third-party website that LendKey offers a hyperlink to is up-to-date and accurate at the time you access it, and LendKey does not guarantee that information provided on such external websites (and this website) is best-suited for your particular circumstances. Therefore, you may want to consult with an expert (financial adviser, school financial aid office, etc.) before making financial decisions that may be discussed on this website.