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How to Get Out of Debt After College


How many people do know that currently have student loans? They may still be in college, or perhaps they have graduated and moved onto their career; however, their student loans still follow them wherever they go. I want to show you how to get out of debt after college.

Adults with Student Loans

I remember very vividly (when I was in high school); my Spanish teacher came bouncing into class one day. She was all smiles and announced proudly, “I paid off my student loans today!”

My initial thought was not excitement for my teacher, it was more like, “What the heck, you’re 42 and you still had student loans?” But, as I found out later in life, this is not all that uncommon.

When students graduate, they normally don’t have a job lined up and they suddenly have to find money for an apartment, food, transportation, and clothes. They can’t take out loans to pay for their necessities anymore! Because of the immediate expenses, those student loans don’t often get paid off too quickly.

Paying Off Your Debts After Graduation

Ideally, students should be working hard to keep their debts under control while they’re still in college, but that’s not an easy thing to do. With a demanding class schedule and a part-time job, there’s sometimes not even enough time to socialize when you’re a student, let alone take on another job.

Plus, while in college, $20,000 doesn’t really seem like that much debt. I mean, when you get out you’ll be making at least $75,000 a year, right? You could pay it off in just a few months! …..Not likely. Some Masters students are only making $30,000 after college, and then add in all of their new expenses and there are very few dollars left to put toward that student debt.

So How Can You Get Rid of the Debt?

1) Keep your housing expenses to a minimum

If your parents want you back home (fat chance, but who knows?) and you don’t mind their company, then head back to that free shelter!

If you’re not fond of having your dates meet your parents every night, then perhaps you could save money by sharing an apartment with your friends. $900 a month is pretty steep for your small income, but $300 is certainly doable when you share it with your 2 friends!

2) Decrease You Transportation Expenses

Many of you might think that you need to drive your car all the time, but be honest with yourselves, you know there are alternatives. You just have to seek them out.

  • Check to see if the bus route travels near you. If you can get to work and the grocery store, then you could really do without your car. This would save you money on insurance, gas, and the maintenance, not to mention the overall cost of the car.
  • Get reacquainted with your bicycle/rollerblades/skateboard/walking shoes. You’ll get exercise, plus you’ll save a load of money in gas each month.
  • Carpool – you’ll develop better relationships while saving money and helping the environment.

3) Learn to Barter

Why is it that no one barters anymore? Most likely, you have a bunch of junk that you don’t really want, but is of interest to someone else. Let’s say your friend is a builder and you have a room that needs to be finished. Rather than pay him with cash, ask him if he’s interested in any of your things. Chances are, he’s been envious of something you own and you never knew it. You could soon have a finished room and finally get rid of that statue that you always hated (or whatever it is that you wouldn’t mind giving away)! All while keeping your cash safely in your pocket. 🙂

There’s actually a section on Craigslist devoted to bartering. Not only is it useful for those of you that need to get some projects done, it’s also a blast to look at!

4) Increase Your Income Without Improving Your Lifestyle

Let’s say you just found out that you received a promotion today. First of all, congrats! But, don’t get so excited that you go out and reward yourself with a brand new car or boat. Adding payments to your life will not help you get ahead.

I have a friend that recently graduated from medical school with quite a lot of debt. He’ll soon be a doctor and have colleagues that own multiple houses, yachts, and brand new cars. His late 90s car will most certainly be the crappiest of his friends, but if he really wants to get out of debt, he’ll keep his junker until the last penny of his student loan is paid. If he gives in, he’ll most certainly have debt for a very long time.

5) Find Creative Ways to Earn Additional Income

There are so many ways to earn some extra money these days. All you have to do is open your eyes! I give countless ways to increase your income on my site, so I won’t get into it here, but take my website for example. I started this silly operation about a year ago and it’s already yielded me over $7,000! Next year, I have a goal to make over $40,000, and I think that goal might be a little too easy!

Do you still have college debt? How about your friends? What are you doing to get rid of it?

Get Out of Debt Money


My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.


  1. I have a son in college right now and I worry a lot about his ability to pay back his loans. I know he’ll work hard, but even at a state university the cost is still so high that he’ll need to get a real good job right away.

    • That is a valid concern. If I were you, I’d make sure that’s he’s aware of how difficult it will be to pay back those loans. Of course, if he’s like other young adults, he’ll just brush it off and assume he knows better than you… but I think you should try anyway! Good luck to him (and you).

  2. ALL great tips Derek. I especially think transportation is an area where so many of us make bad choices. It’s too easy to be fooled into thinking an expensive car is the best option when there are so many other alternatives.

    • Yep yep. I’ve already purchased a more expensive car that was supposed to be more reliable…. then came the immediate $2,500 in repairs. We would have been better off buying a $1,000 junker.

  3. I agree with Hunter. I drove a beater for a couple of years after college, but then purchased a new car after that. I should have looked for a used car instead. At least I didn’t buy a BMW like some of my friends.

    • It seems like people that drive new cars are always upset about the decision a few years later. If I ever buy a new car, I’d better be a millionaire.

  4. I agree with Hunter and Retire by 40 on the car. drive extremely used cars and don’t let your new salary go to your head. The other thing you can do is get roomates. If you drive a beater and have roomates you can avoid a lot of lifestyle inflation.

    • You’ve got that right YFS! It’s best not to let that new salary go to your head. Most likely, it’s really not that big considering the new expenses you’ll experience. Unfortunately, it’s normally too late when the realization strikes you…

  5. Praise the Lord I never accrued debt after college. The only debt I willingly entered into was my Acura TL. I paid it off before interest rates sky-rocketed, however. I loathe debt. The thought of it sickens me and petrifies me. EVERYONE can go through college without being enslaved to debt. I did it. You just have to work hard and be motivated.

    • Great comment Jon! I believe that everyone can get through college debt-free as well! It definitely takes some hard work and some knowledge about living cheap and getting those grants, but it certainly is possible! Great job getting through college debt-free!

  6. Useful tips!

    I would add: Save money on your health expenses! Get a high deductible health plan, and check out the internet resources to keep yourself healthy.

    • Good point. Almost all college students should sign up for the high-deductable health plan. It saves a ton of money each year!

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