Student Loans, experience?
For those of you who have/had student loans, what repayment approach did you take? Student loan forgiveness plans/income-driven repayment plans, or refinance/consolidation plans? Or did you just straight up try to pay it all off ASAP however/whenever you can? For those who chose refinance, anyone have any experience with low interest rate lenders/companies like SoFi, Earnest, LaurelRoad, LendKey, Commonbond, etc? Out of college I went with the lowest payment option possible (forgiveness plan), but I’m learning that might NOT have been a good move because it just tacks on considerable interest with the idea that in ~20 years whatever is still left will be wiped clean. Sounded decent, until I learned you’re still taxed on that big forgiveness chunk 🙄. Been out of college for many years now and higher payments are less of a problem, so now I’m looking at better options. Unless, maybe I don’t need to make a change? Any insight appreciated!
Refinance and/or debt approach overall is to look into the debt avalanche approach of paying as much as you can to the highest interest account and work your way down.
Good insight, thank you.
Very low payments. In no rush to pay them off. And I’m pretty sure I won’t be worried about it in 20 years.
I thought this as well, and I figured it couldn’t hurt to just not think about it and pay it off very slowly and eventually it will go away. But then I thought… Do I really want this debt hanging over me for the next 20 to 25 years? When I’m buying a house, etc?
It can actually work for you. Building up a long credit history. It’s actually docked a few people I know who paid of early because they didn’t have a huge credit history.
To start I’d recommend doing a refi to lower interest. Then as a second step I’d defer to taking the Dave Ramsey approach and being laser focused and paying off those loans and any other debt (minus your home) in a much shorten time frame (say 1-3 years). Check out his podcast / or google his 7 baby steps for more insight.
Thank you. I’ll look into this for sure.