If you are a student stuck at home and/or in a low paying job, your debts, be they your student loans or your credit cards, may be burying you alive.
However, this doesn?t necessarily need to be the case. Read on to discover how you can manage and even repay your debts soon.
Managing and Repaying Student Debts
Managing your student debts doesn?t necessarily need to be a hectic task. In fact, the only reason it seems so is because you?re too worried about how you will repay them. So, breathe and follow these tips to ensure that you?re on the right track.
- Start budgeting. This is important since it can help you save money to slowly pay off your student loan debt. Besides, it will help you become wiser while making financial decision since you will be able to differentiate between your needs and luxuries.
- Create a record to track your loans. Make sure that the file accurately states how much you owe and how much you have been paying. Also, insert any paperwork you receive from your lenders so that you can easily prove that you paid if asked.
- Always keep the line of communication open with your lender. Talking with them will help you come up with an executable plan that will make both of you happy. However, remember to be honest, realistic and upfront or else you may be forced to default and ultimately ruin your credit score.
- Consider adjusting your plan if you don?t think you?ll be able to pay your loans by their final deadline. Discuss alternative options, such as income-based repayment plans, and make sure that your lender agrees to consider them.
- Create priorities for your loans in order to pay off those with the highest interest rate first and minimize the total interest you should be.
- Try getting a job in the teaching, dentistry and medicine, law, or public service sectors. Chances are that a portion of your loan may be cancelled or you will be given the chance to join a loan forgiveness program. Some volunteering groups, such as the Peace Corps, also provide members with grants to repay their student loans.
Managing and Repaying Credit Card Debts
A survey conducted in 2012 uncovered that college seniors had an average of $4,100 in credit card debts. Though they may seem justifiable while you?re still at school, these debts are bad since they won?t increase your wealth or earning power. In fact, credit card debts may lead you to sink into bankruptcy on the long run. So, if you want to avoid a major slump, consider these tips.
- Determine which debts to pay off first if you have more than one credit card. Your aim should be to provide at least the minimum payment on each card. Another strategy is to pay more on the card with the highest interest rate or handle the smallest debts first.
- If you want to repay your debt faster and slash the amount of your interest, consider paying a little more than the total monthly minimum.
- Debt consolidation can be a helpful process if high interest rates are stopping you from paying more than the minimum. With a lower interest rate, chances are that you will pay the balance quicker without adding to your payments
- Again, budgeting is essential for managing and repaying your credit card debts. Not only will it help you save, but it will point out where you tend to overspend so that you can make wiser decisions later.
- Prepare to negotiate temporary reductions to your minimum balance payment. You will need to provide a good reason for this, but you may be able to pull this off if your creditors know exactly what you go through.
- Don?t be ashamed of getting counseling from a non-profit counseling agency like Consumer Credit Counseling Services. You may need a professional to guide you or help you if everything else fails.
So, don?t let your debts control your life. Remember these tips and make sure that you follow them for more financial peace in the future.
Source: http://www.girlsjustwannahavefunds.com/manage-student-and-credit-card-debt/
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