Should you pay off your student loans or your credit cards?
For many recent college graduates, student loans and .credit card debt are their biggest financial concerns. These loans can make it difficult to get started on a professional life, especially if the payments are getting in the way of being able to pay other bills. When this happens, many people feel as if they have to choose which one of these bills to pay.
In fact, this is one of the most dangerous places to be in your financial life. Choosing not to pay a bill almost always means that you are making a decision that will have devastating consequences. No matter which bill you choose, you will have to come up with the money for late fees, your credit will be ruined, and you’ll have problems finding anyone who will be willing to give you another loan for months.
If you choose to not pay your student loans, the effects can be even worse. Because these loans operate under a different set of rules than other types of credit, they can have serious consequences if a former student does not make his or her payments. These loans cannot be easily discharged in bankruptcy, so you will be stuck with this debt until it is paid off. In the meantime, a creditor is allowed to garnish a portion of your wages, and if they’re government loans the government is allowed to keep your tax returns and Social Security checks until the debt is paid.
Rather than trying to decide which loans to pay each month, you need to take steps to make your payments manageable. A debt consolidation loan can help you with this. These loans pay off all of your existing debt and leave you with a single loan with a low interest rate. In addition, they can extend your loan term, giving you more time to get the loan paid off. This means that your payment can drop by over half every month.
<p data-sp-element=”content”>With a lower payment, it is possible to pay your debts and have some extra money to put towards savings or other bills every month. These loans make it possible to save up for a down payment on a house, save for retirement, and still make progress on your debts. They are designed to keep your payment the same every month, making it easy to include them in a spending plan.