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Hello All.
So here is my situation. I have a job that pays $40,000 a year. I commute just over 30 miles each way to work and pay $3 in tolls a day. I choose the toll road because it is a lot faster and less traffic. And even though I commute 30 miles and two counties away to work, its takes me less time to get to work than my boyfriend who commutes within the city; Miami.
So here is my dilemma; with gas prices rising and no way for me to commute by bus/train without it taking 2-3 hours each way and costing close to the same as to drive. I have a private student loan that is roughly $600 a month. Which I have been paying on time or early for the last year and a half. And I also purchased a condo in February of this year, which is roughly the same I was paying to rent. I was thinking about taking classes at the community college and deferring my student loan to putting the $600 a month towards my credit card debt which is about $7,000; half of that being on 0% cards. If I get rid of my credit card debt it would save me about $200 a month.
Is this a good idea? I was worried about not being able to cover the interest that will accrue during the time its deferred and it capitalizing. My interest rate on the student loan is a horrible 14%.
I'd suggest paying down the highest interest rates as fast as possible.
If $3,500 is at 0%, I'd pay only the minimum and and make extra payments to the higher interest credit card or student loans. At 14%, I have a hard time justifying defferring payments. Can you pick up a second job on nights or weekends to pay down that student loan faster?
Have you tried consolidating or getting a better rate? Is it a private loan or a federal loan? Subsidized federal loans will not capitalize interest during in school deferrment.
I'd suggest paying down the highest interest rates as fast as possible.
If $3,500 is at 0%, I'd pay only the minimum and and make extra payments to the higher interest credit card or student loans. At 14%, I have a hard time justifying defferring payments. Can you pick up a second job on nights or weekends to pay down that student loan faster?
Thanks for your reply DasNootz. And Yes I only make the minimum to the 0% cards. And the student loan is the highest interest rate, so I would like to put more towards it, but it being $600 a month, i really don't have the extra funds to put towards it. Thats why I was thinking of defferring it until I pay off credit cards completely. As far as a part time job, I am training to work part time as a personal trainer, but that wont start until maybe August. I was thinking of getting a part time job, since I have my nights and weekends free in the summer months. But a friend of mine told me about Primerica and said I should join it with him.......from what he said it looks like money can be made, but its like a multi-level thing. Do you know anything about Primerica?
Have you tried consolidating or getting a better rate? Is it a private loan or a federal loan? Subsidized federal loans will not capitalize interest during in school deferrment.
Its a private loan with the devil; "Sallie Mae" . I have tried everything to get it consolidated and refinanced and my rate lowered with the lender, but nothing worked out. I'm kinda of stuck.
I've never given much respect to Primerica... Not to be rude, but what makes someone who's openly questioning what they should do about their debts on an online forum suited to be a financial advisor?
On the surface it seems like a complete multi-level scheme... the Amway of life insurance and financial services.
Wouldn't you have to spend money up front too?... That money would probably be better spent paying off your current debt. If your buddy is making good money from it, maybe he can hire you to be his/her assistant, or pay you to cold call for him on an hourly basis. Then at least you're learn more about the "system" before you've put your money into it.
Typically only the top couple of percent of people in multi-level programs ever make money (or at least enough to live on). In my opinion, you'd be better off spending that money on your debt, or paying for bartender's school. At least you're selling a product to willing customers, and not calling your friends to buy insurance and mutual funds... or asking the go go into business with you.
I've never given much respect to Primerica... Not to be rude, but what makes someone who's openly questioning what they should do about their debts on an online forum suited to be a financial advisor?
On the surface it seems like a complete multi-level scheme... the Amway of life insurance and financial services.
Wouldn't you have to spend money up front too?... That money would probably be better spent paying off your current debt. If your buddy is making good money from it, maybe he can hire you to be his/her assistant, or pay you to cold call for him on an hourly basis. Then at least you're learn more about the "system" before you've put your money into it.
Typically only the top couple of percent of people in multi-level programs ever make money (or at least enough to live on). In my opinion, you'd be better off spending that money on your debt, or paying for bartender's school. At least you're selling a product to willing customers, and not calling your friends to buy insurance and mutual funds... or asking the go go into business with you.
, lol. I don't think thats rude at all, it makes since. I googled Primerica and found some people who weren't too fond of them either. I have made mistakes about my finances before by just being uninformed or just stupid, so now I want to research get advice and do whatever it takes to not be in the same rat race that sooo many people are in; living check to check. I live by a pretty strict budget now and watch my finances closely.
I know how you feel about Primerica, so you suggest not deferring the loan and just look into more income?
If you can defer, without having your loans continue to compound interest while you're not paying, then it would make sense to pay off your credit cards first.
However... if your loans will continue to compound interest at a rate of 14% while you're making $0 payments, it's silly to defer.
In any case, depending on your workload, lifestyle choices, etc... I'd almost always suggest looking for ways to get additional income when you're young. It really can give you a step up with the rest of your life. Understand that building wealth is a marathon and not a sprint, but it's always good to get a head start.
Good stuff. I agree about the compound interest. And I'm a 24 year old healthy individual so putting in extra time and effort now is something I could do.
Its a private loan with the devil; "Sallie Mae" . I have tried everything to get it consolidated and refinanced and my rate lowered with the lender, but nothing worked out. I'm kinda of stuck.
I have a private loan with Sallie Mae. They are vultures when your grace period is up. In order to defer a private loan you have to pay $50 per loan and their interest rate on their private loan is high. Pay the $50 per loan to defer it for 6 months and hopefully in 6 months you will be able to pay it a little easier.
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. I have tried everything to get it consolidated and refinanced and my rate lowered with the lender, but nothing worked out. I'm kinda of stuck.
, lol. I don't think thats rude at all, it makes since. I googled Primerica and found some people who weren't too fond of them either. I have made mistakes about my finances before by just being uninformed or just stupid, so now I want to research get advice and do whatever it takes to not be in the same rat race that sooo many people are in; living check to check. I live by a pretty strict budget now and watch my finances closely. 
