How to potentially save thousands on your personal loan without refinancing

A personal loan could be a powerful way to simplify your finances, especially if it's a debt consolidation loan that helps you pay off higher-interest debt. There are many ways to keep the momentum going and save money while you pay off a personal loan.

You've done the hard part by getting the loan. Now you can turn your attention to how to save money on it. No need to refinance your personal loan, either. Just a few smart habits and small moves could help you cut interest, avoid fees, and keep your financial goals on track.

Here are a few easy tips for how to save money on a personal loan without refinancing.

1. Check for an autopay rate discount on your personal loan

Automatic loan payments could lead to a lower interest rate. Some lenders offer a slightly lower APR (typically about 0.25% less) if you sign up to autopay your personal loan. You may be able to get this discount on a new or existing loan depending on your loan terms.

Even if an autopay discount isn't available for your loan, setting up autopay on your personal loan is still a good idea. That's because automatically paying your loan could help you avoid late payments and extra fees.

The main thing to watch with autopay is keeping enough money in your account that your automatic payments don't bounce. That could trigger an overdraft fee and you might get hit with a late payment fee from your creditor. Balance alerts could help you stay on top of what's in your account.

2. Never miss a personal loan payment

One of the best ways to save money on personal loans is to make sure you never miss a payment. Late fees add up quickly, and missed payments could damage your credit—which could mean higher APRs when you borrow in the future.

Consistent, on-time payments help keep these costs down. And every on-time payment could help you build credit, which may make it easier to qualify for better rates on future loans.

Achieve is not a Credit Repair Organization and does not provide, or offer, services or advice to repair, modify, or improve your credit.

3. Put windfalls to work for bigger potential savings

Any extra payments you make over your required monthly payment could go toward paying down your principal. If you can pay off your loan early, you could save money on interest fees. (Just make sure your loan doesn't have any prepayment penalties.)

So, another way to save money on your loan is by using whatever spare cash you can find in your budget to make extra loan payments. That means snagging any windfalls throughout the year, including:

• Tax refund

• Cash from a garage sale

• Year-end bonus at work

• Extra income from an inheritance

• Birthday gift money

This could all be used to pay down your personal loan balance faster. Personal loan interest is generally calculated each month based on your average daily balance. As your principal balance shrinks, so too does the amount of interest you're charged. Even if your windfall is just enough to make one extra payment per year, this could shorten your payoff period and reduce interest.

As an illustrative example, say you have a $10,000 loan at 13% APR with a five-year term. If you just made your regular payments, you'd wind up paying around $3,652 in interest over the five years. But if you put an extra $1,000 from your tax return each year toward your loan principal, you could cut the cost down to $2,394 in interest and shave 18 months off your payoff time.

4. Make biweekly loan payments

Most personal loans require one fixed payment each month. With biweekly payments, you divide your monthly payment in half and pay every two weeks. Over the course of a year, you'd make 26 half-payments, which adds up to 13 full payments—one extra payment each year.

As we showed above, even one extra loan payment each year could add up meaningfully over the life of your loan. You could save money on interest and pay off your loan faster than sticking to your regular payment schedule.

Not all lenders allow biweekly payments automatically, so you may need to contact your lender or make your payments manually.

5. Avoid running up new credit card debt

Credit card debt is typically one of the most expensive ways to carry debt due to the high interest rates. A balance on your credit cards could mean any extra money in your budget goes to card interest instead of paying down your personal loan faster.

Optimize your budget so you can pay your credit cards in full each month. Without extra interest fees to pay, you may have extra money to put toward your personal loan. This could shorten your payoff timeline and save significant money on interest.

What's next: Build momentum to pay off your personal loan faster

You don't have to refinance a personal loan or wait for the perfect rate to start saving. These everyday habits could keep more money in your pocket right now.

Want a bit more help? Check out the Achieve GOOD app for free tools on how to track your spending, save more money, and make a plan to pay off your personal loan faster.

Ready to consolidate high-interest debt or get cash for other goals? Learn more about how Achieve Personal Loans could help.