There are several ways to reduce your total loan cost. Here are some of them:
1. **Develop a budget**: A budget will help you meet your expenses and prioritize the most important things first.
2. **Borrow only what you need**: Borrowing more than you need will increase the total cost of your loan.
3. **Pay early and often**: Paying early and often can help reduce the amount of interest you pay over time.
4. **Make more than the minimum payment each month**: Making more than the minimum payment each month can help reduce the amount of interest you pay over time.
5. **Make extra payments**: Making extra payments can help reduce the amount of interest you pay over time.
6. **Set up auto-pay**: Setting up auto-pay can help ensure that you never miss a payment and can help reduce the amount of interest you pay over time.
7. **Increase your credit score**: Improving your credit score can help attract better and favorable rates.
8. **Shop around and compare offers**: Shopping around and comparing offers can help you find loans with better interest rates.
9. **Refinance your loan**: Refinancing your loan can help you get a better interest rate, lower monthly payments or even a shorter loan term, which can help reduce the cost of your loan over time.
For example, if you have a $10,000 loan with an interest rate of 10% and a term of 5 years, your total cost would be $12,748.20. However, if you make extra payments of $50 per month, you could save $1,000 in interest and pay off your loan 7 months early.
