How Paying Student Loans Biweekly Saves You Time and Money

paying student loans biweekly

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If you’re looking to pay off your student loans faster, there’s an easy hack to make it happen: paying student loans biweekly. That’s right, if you split your monthly payment in half so you’re making payments every two weeks, you’ll end up making one full extra payment each year. You won’t have to change your spending habits at all, but that extra payment will cut down on interest costs and get you out of debt faster.

Here’s why paying student loans biweekly helps you knock out debt, plus tips on how to set up your biweekly student loan payments.

Why paying student loans biweekly accelerates debt repayment

When you pay your student loans on a monthly schedule, you make 12 payments per year. But if you split those payments in two and make them every two weeks, you end up making 13 payments per year.

Allow me to explain.

Even though there are four weeks in a month, there aren’t 48 (12 x 4) weeks in a year. Instead, there are 52 weeks every year, which is why your biweekly student loan payments equate to an extra full payment annually.

One extra payment isn’t going to make your debt disappear overnight, but it can seriously cut down on interest charges and time spent in repayment. Let’s use a biweekly student loan calculator for an example.

Let’s say you owe $40,000 at a 5% interest rate. On the standard 10-year plan, you’d make monthly payments of $424 and pay $10,920 in interest over the course of repayment.

But if you split that amount into two and make biweekly student loan payments, you’d pay $212 every two weeks. Over the years, you’d save $1,183 in interest and get out of debt 12 months faster — that’s a full year!

And you don’t have to put in much effort to do so, since you’ll still essentially be paying the same amount every month.

How to set up biweekly student loan payments

Now that you see how easy it is to save money with biweekly student loan payments, let’s talk about how to set them up.

Step 1: Make sure your loan servicer allows you to pay biweekly

Some loan servicers make it easy to set up your biweekly student loan payments on autopay. You can simply set it and forget it, and you won’t have to worry about missing a payment.

But others don’t offer this feature, which would mean you’d have to do it manually. If you’re on top of your bill payments, doing so could be worth it.

But if you’re worried that you’ll forget to make payments, it might be better to stick with the usual monthly autopay schedule.

Step 2: Consider lining up your payments with your paychecks

If you receive biweekly paychecks, you could line up your student loan payments with your paycheck schedule. That way, you can feel confident that you have enough money in your account to cover your payments.

Step 3: Double check your due date

If you’re switching to a biweekly schedule, you need to make sure your payments arrive ahead of your usual monthly due date. If you choose to pay your student loans on a biweekly basis, double check that your payments are getting in before the typical deadline.

Step 4: Direct your loan servicer to apply your payments to the principal

Finally, make sure your loan servicer is applying your loan payments correctly. You don’t want them to save your payments for a future date. Instead, instruct them to use your payments the way they’re intended — to pay down your student loan.

Potential cons of biweekly student loan payments

While paying student loans biweekly is an easy hack for getting out of debt faster, it could have a few potential downsides.

As mentioned, you need to make sure your loan servicer applies your payments correctly. You want them to use the payment to your principal, and not save it for a future payment.

Second, you need to make sure your payments arrive ahead of your due date. You wouldn’t want to accidentally make a late payment on your student loans.

Finally, you should double check that setting up biweekly student loan payments won’t cost you your autopay discount. Most student loans offer a rate discount of 0.25% for autopay.

Double check with your loan servicer that you won’t lose this perk, since you want to save as much on interest as you can.

Extra payments will get you out of debt faster

Paying student loans biweekly is an easy way to make extra payments without even realizing it. But if you want to get out of debt even faster, you could make additional extra payments.

In fact, you can prepay your student loans at any time without penalty. So if you can afford to pay more each month or once in a while, you could save even more money on your loans.

Another strategy that could save you money is student loan refinancing. If you can qualify, you could snag a lower interest rate and choose a new repayment term.

Refinancing student loans can be a savvy way to conquer your debt faster, but not everyone will qualify. You’ll need a strong credit score to meet a lender’s criteria (or a cosigner).

And it’s not the best move if you’re struggling to afford your student loan payments or are relying on any federal protections.

But if you’re committed to getting out of debt fast, consider making extra payments or refinancing your loans to speed up your progress.

Head to this guide for more on the pros and cons of refinancing student loans!

Want better rates? Here are the best banks to refinance student loans:

 Variable rates start at...Fixed rates start at...Repayment termsWelcome bonus Check your rates
refinance student loans1.98%2.99%5 - 20 years$200Visit LendKey
refinance student loans1.99%2.98%5 - 20 years$200Visit Earnest
refinance student loans1.89%2.80%5, 7, 10, 15, and 20 years$120Visit Laurel Road
refinance student loans1.92%2.49%5 - 20 years$100 or $200, depending on the amount you refinanceVisit Credible
refinance student loans2.25%2.99%5, 7, 10, 15, and 20 years$100Visit SoFi
refinance student loans2.39%2.79%5, 7, 10, 15, and 20 years$100Visit ELFI
refinance student loans1.98%2.83%5, 7, 10, 15, and 20 yearsN/AVisit CommonBond