This past week I was way too busy to spend any money. I didn't even buy gas or grocery shop. I know my husband is out there shopping - so money is being spent, but that's ok. We've got to eat!
So I've been looking at all of our payments and debts and stuff. One major thing I'd like to accomplish is getting rid of my student loans. I was just looking at student loan info and we're paying $60 in interest every month on one of them, and the other one is about half. We're paying $100 bucks in interest every month and that makes me sad.
Besides paying them off faster - and lowering the interest by lowering the principal - is there anything else we can do? Does it benefit our family to pay them off faster? Isn't student loan debt, "good debt"? Don't we get a tax break for this interest? I need to look into it. I consolidated my loans when interest rates were high, is there a way to get a lower rate? Would a personal loan be better, would a home equity line of credit help us?
If you have any ideas for me, please let me know because I'm going to start working on this problem. $100 is a lot of money to be "wasting" every month on interest....
Hmmm. Well, what is the actual interest rate on each one and are they federal loans? https://loanconsolidation.ed.gov/AppEntry/apply-online/appindex.jsp has information on consolidating Federal loans (generally stafford or perkins loans.
ReplyDeleteA home equity line of credit will likely only be extended to you if you have gained equity in your home. I'm wary of moving federal loans onto a private loan or equity line of credit. However, if you have private loans, perhaps this would be a good option.
Also, check out if there is a penalty for paying off the loan early. Sometimes there is, 'cause they want that interest money... it's how they make their profit ;-)
If federal loans and you've structured this debt into your monthly budget, you might just want to think of it like a mortgage. Structured and stable debt that will eventually get paid off in the long run.
ReplyDeleteHey, you should be able to claim the interest on your taxes. Your lenders should send you a 1099 form... or they can make it available to you online for you to print out.
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