Even though the live stream wasn’t working very well at the time we recorded this, I’m pretty pleased with how this video / conference call turned out. Keep in mind, possibly before you watch (or listen) to our segment, that Jason has fully explained his situation in the How to Repair Your Credit post. There’s no way you could crawl out of hundreds of thousands of dollars of debt with nothing more than minimum wage. I’ve (thankfully) never been in such a dire situation before. The worst debt I’ve ever been in involved my student loans.
None of us here are credit experts – and there are plenty of people in this world who take advantage of this fact. It’s all the more reason we must start sharing these money-saving (and in some cases, life saving) tips with one another. There are so many little things you can do to help your credit rating, whether it’s in good or bad standing.
As i was poring over the responses to my most recent post on student loans, I started to vent. I can’t tell you how upset I was with the prospect of student loans, and i was never able to form a complete argument over why I think they’re more of a hindrance than a help.
Let me get this straight: as young adults, we’re expected to gain an education, and if we cannot afford said education to propel ourselves (and vicariously, our society) forward, we are given two choices: (a) avoid higher education, or (b) weigh ourselves down with tens of thousands of dollars in student loan debt before we’ve even had a chance to see whether or not our higher education was actually worth the price of admission.
Didn’t seem very fair to me then – and it doesn’t seem very fair to me now. I’m not saying that all educational costs aren’t justified, but isn’t America shooting itself in the foot with this increasingly self-destructive system? I was lucky – I found a NON-TRADITIONAL way to pay off my student loans (and even then, after forking over several thousand in excess interest). I barely knew anything about what I wanted to be when “I grew up” – let alone, the ins and outs of credit.
I wouldn’t trade my education for the world – but I will say that we’re not living a “free” society if we don’t give every single mind the opportunity to be shaped without the fear and stress of debt. It’s bad enough we have credit card companies preying on underinformed citizens – are the student loan organizations and the institutions which enable them equally as sociopathic? And before you dismiss this accusation as unfounded, let me remind you of the definition of a sociopath. According to The New Dictionary of Cultural Literacy, Third Edition Edited:
Sociopaths are interested only in their personal needs and desires, without concern for the effects of their behavior on others.
We’re not helping our society grow by imposing debt on those who would help it flourish – we’re handing it the disease and charging for the cure. Feh.
Every May, a new group of students graduate from college and begin jobs. For many of them, large student loans put a damper on cashing-in that first paycheck. I was one such student – fortunate enough to have been given student loans, and unfortunate enough to be saddled with them. I asked my experienced contacts at Linkedin to give some advice to anyone struggling with student loan debt. For me, it was landing my first book deal. The advice they give, however, could also likely apply to consumer debt (which is a WHOLE separate issue).
shop around for the lowest interest rates and ease of use
lock in a fixed interest rate rather than a variable one
(if you can afford to) pay higher monthly payments to pay off your loan faster (with less interest paid)
make payments on time every time and if possible choose to have payments automatically deducted from your account – you’ll typically get a discounted interest rate, which over the years saves you thousands of $
You’ll need to provide more specifics about what you would like to know.
Are you asking about your own student loan debt or loan debt in general? Are you trying to pay it off? Are you wondering if you should pay off your student loan vs credit card debt?
I have a fair amount of experience with student loan debt (my own), and I would be happy to help you if I can.
I would suggest staying away from, or seriously reviewing the consolidation programs ‘fine print’. Most of the time, consolidating affords you a lower payment, but is actually just a longer time period, so the end results in a much larger payment. Much like if you bought a car and chose the 5 year plan versus the 3 year plan.
I would also suggest finding someone you trust with your finances (family, friend or professional) to help review your budget and figure out a workable game plan (without consolidating – unless you have to because your debt is larger than you can handle).
For me to get out of debt I needed to recognize that I could either keep accruing debt and always live a restricted lifestyle or just go hard at paying it off in 2 years and then live exactly how I wanted. I chose the latter and even though it was hard to do, I’m so glad I did.
Look at the Department of Education. I *THINK* you can consolidate your loans directly from the government. The bonus there is that you can change your repayment plans to lower your monthly payment if you need to.
Chris – I don’t have expertise in this area. But a suggestion to you would be that CPAs generally have a vast network of people they can refer you to. I would contact your CPA or a local CPA and see if they can answer your specific questions and/or refer you to someone. The other answer is to connect with your reference desk librarian, they have tons of answers and resources.