I have 3 student loans. 2 small Perkins and one large Stafford. Several years ago, when interest rates were low, I consolidated my undergraduate Stafford loans into one big loan so that I was making one payment instead of paying on 4 separate loans. At the time, I didn't realize that this would extend the payment period, and I regret doing this now, although paying on 4 loans would have been a challenge. I received a letter on Friday congratulating me for making all payments on time, therefore they were reducing the interest rate of that consolidated loan. 2.25% is the new rate. Doesn't change the monthly payment amount, but will cause the loan to be paid off sooner. Continuing the current payment amount and the loan is paid off by 2025--just in time for my boys to start college. That is not acceptable for me. I have a plan to have my two smaller Perkins loans paid off this year. I will then send the $72 to pay on the principle of the Stafford loan. I ran the numbers on a loan calculator today. This will get the loan paid off 6 YEARS EARLIER!!!!
I don't regret taking out students loans. That was my only option in order to get a college education as my family was not well-off, I just wish I hadn't inadvertently extended the repayment period. Advice: sign-up for autopay so that payments are received on time as you will get an interest rate reduction for timely payments.