Are you ready to graduate and you know that student loan repayment is right around the corner? Have you been properly informed as to what you are going to be dealing with and what exactly you are about to go through? There are many things you must know including education student loan consolidation and the process. Here are some of the things you should know.
First, when it comes to paying back your student loans you get 6 months from the end of school for you to find a job and start paying on them. This is a deferment or grace period that you are allowed to pay on them, but not required to. After 6 months you will be making regular monthly payments on all the loans you took out.
Second, you can use education student loan consolidation to combine all your loans into one. This will give you one monthly payment instead of multiple to manage. You will also get one low interest rate and only one loan provider to deal with. Using education student loan consolidation will make your loans much less of a headache and will allow you to make the payments with ease.
Last, you also have the deferment and forbearance options to use if you cannot pay on your loans for one reason or another. The deferment option is an option you can use for any reason at all for up to 2 years. Forbearance is for financial hardship and you can use if for 6 months at a time with no limit to how much you use it.
Posts Tagged ‘ Financial Hardship ’
Aug
Credit cards are often seen as the bad guys, leading to spiraling debt and financial hardship. Well, this really shouldn’t be the case if you use your credit card effectively. In fact, using a wisely can actually help you cut your costs by several hundred pounds a year. Even further, by playing your cards right, you can easily make money through spending on your card. So why are you still using cash?
They carry frightening baggage, with high interest repayment rates, and of course this is true – this is how the companies make their money. However, as a result of the competitive nature of the market, there are many special offers available that make the credit card more beneficial than cash. Firstly, d companies guarantee against fraud by securing certain transactions.
This means that if someone tries to thieve your money, you know the credit card will refund the payment so you don’t have to. Secondly, they have introductory offers like 0% for the first six months, which means you can effectively obtain a short-term loan provided you pay it back within the period. This can be really helpful if you’re facing temporary cash flow problems on the run up to pay day. Furthermore some cards offer cash-back incentives of up to 3%, meaning you’re effectively saving money every time you make a purchase.
Because there is such fierce competition in the market between the various card providers, it is possible for you to actually make money from using your credit cards. The free 6 month period on cards is great news for consumers. Simply take out one and transfer the balance to a high interest savings account. Provided there is no charge on balance transfers, and you always pay off the bill in full, all you need to do is let the money work for itself to earn you interest, and switch to a different card when the 6 months is over. You can expect a return of around 5% on your money per year, which is obviously a nice earner running alongside your other forms of income.
Credit cards aren’t all bad, but they can lead you into financial trouble. Do your homework before opting for one, and shop around to find the best deal that’s out there for you and your needs, whatever your purposes or intentions.
The biggest financial decision you are likely to make is buying a home, closely followed by less expensive must-haves like a vehicle. But the one deal you should aim to get right is the decision on life insurance. This is the difference between leaving your dependents with an adequate amount of cash to see them through the times of economic hardship after your income is lost, and leaving them with nothing. In this, the decision on term as against permanent insurance is the key. Put the wrong key in the lock and you open a door into real financial hardship. So what’s wrong with term insurance? Think of this as like a bet. If you die within the term, your dependents are the winners. If you prove healthy and live too long, you lose the premiums you paid and your dependents get nothing. Now, when it comes to permanent insurance, this builds up a cash value. The longer you have the policy in place, the more valuable it comes as the premiums you pay attract investment returns. During your own life, you can take some of this money back or borrow using the fund as collateral. When the sad day finally comes, the benefits are paid out to your dependents less whatever drawings or borrowings you have made.
From these short sentences, you will immediately suspect the other difference between the products. Term life insurance is the cheap option. It gives you security in the amount of the benefits for the number of years you select. If you buy one term policy after another, the premiums are higher each time because your life expectancy is less on each renewal. Permanent insurance premiums are higher because a percentage of what you pay is invested on your behalf to generate the cash value. So your fund receives the benefit of the interest, dividends and other returns the investments generate. This makes the total of the cash value the key factor. Do you want a higher rate of return on the premiums? This can be for your own benefit should there be an emergency during your life. Or it can build up over the years for your dependents. If the answer is yes, you must be prepared to pay more to start off the policy – the first year’s premiums often disappear into a black hole representing set-up costs and the selling agent’s commission. But the amount you pay stays the same throughout the lifetime of the policy. So, with inflation, what starts out a struggle slowly grows easier to pay.
The real problem is the uncertainty of the future. Who knows how inflation may affect different aspects of life. What may be cheap now, may be expensive tomorrow and vice versa. So here are a few simple rules. If all you want is cover over the next few years (no more than ten), get life insurance quotes for a term policy. Ten years is not a long enough period of time to build up a worthwhile cash value. Estimate what benefits might be needed, e.g. your daughter will need $50,000 to cover her college tuition fees, and the total will set the amount of the insurance. If you are looking at a period of at least twenty years, you should think seriously about permanent insurance. Again, get life insurance quotes but you should also take advice on the different types of policy available and create or review your estate plan. Between ten and twenty years is a gray area and whichever way you decide is not going to be wrong.