How To PAY OFF FEDERAL STUDENT LOANS Faster | Pay Down LOAN PRINCIPAL |Daily Interest Rate Explained

How To PAY OFF FEDERAL STUDENT LOANS Fast | Pay Down LOAN PRINCIPAL | Daily Interest Rates Explained | NELNET | Paying Off Loans | College & Money

I recently received my monthly statement for my federal student loan, and I was confused as to how I could make over $5000 in payments, but only half of that went to my loan principal. I have been paying on my 16k loan since December 2016 and I haven't made a dent in the outstanding principal amount. I took out two direct unsubsidized federal loans when I began my graduate program. The first amount was $11, 555, which now has an outstanding principal balance of $10,329.83. The second was for $4,445 which has an outstanding principal balance of $3962.78. From loan #1, I've paid $1,225.17 towards my principal, and for loan #2 I've paid $482.22 towards principal. Again, I have made over $5000 in payments and I am still at this point with my loans.

In order to understand what I could do to make more of my payment go towards principal, I called my loan provider at Nelnet and asked them to explain to me the details of the type pf loan I had, the interest rates and the rate structure. I was on the phone with these people for over 2 hours!!! After being on the phone for over an hour and a half, I asked to speak with a supervisor. After speaking with him for about an hour, I finally was able to understand why 40% of my monthly loan payment was going towards interest. My goal has been and still is for 25% of my payment to go towards interest and the other 75% to go towards the principal. It took a lot of mathematical equations that I'm not versed in, but I finally got it down.

I'm sharing what I learned with all of you and showing you the complete calculation process. I was mentally exhausted after doing all of this, but I have complete peace of mind about student loans and I feel at ease with what I need to do to pay off this debt and secure my future. My goal is to pay off my loan by December 2020. I'll keep you guys updated on the entire process and my progress.

DISCLAIMER: I (Jennifer "Jaye" Hodges) am not a loan officer, specialist nor am I a certified public accountant, therefore please consult with a competent professional prior to engaging in any financial strategies. Not everyone will have the same experience by using this strategy, because interest rates are specific to the user and every loan is different. The technique of paying down loan principal using the formula mentioned in the video requires a commitment to keep applying this strategy over time until the desired result is achieved. I (Jennifer "Jaye" Hodges) do not promise or guarantee any specific outcomes and/or results from the use of this strategy.

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