college

Your Real Net Worth

/ destinationscreditunion / Leave a comment


For accountants, your personal net worth is one of the simplest calculations they might be asked to perform. Add up your assets in column A, add your debt in column B, then subtract B from A to find your net worth. It’s a number you should know, or at least be able to estimate, and it’s good to check it every year.  Since it’s March, which is the sweet spot between New Year’s resolutions, January credit check-ups and tax time, there might not be a better time to figure out your net worth than right now.  When you do, don’t forget all of the value that might not translate into worth. We’ve got a short breakdown for you, along with a way to maximize the value in your life while minimizing how much it costs you: 

Your education increases your net worth, even though it may not look like it. Very few investments offer the rate of return that continuing education does. Those who finish their college degree earn, on average, about twice as much as those with a high school diploma over the course of their lifetimes, and the gap has been widening for at least 35 years. Still, your future earning potential doesn’t show up on your net worth, even though your student debt does. If you’re trying to decide whether to go back to school, take a few extra classes or get a new certification, the cost may seem intimidating since there’s no immediate benefit. Don’t let that fool you. 

An education can also increase the value you get out of your life, helping you find a job that makes you happier or getting that promotion you’ve been wanting at your current employer.  Outside of work, going back to school can help you learn a new language or skill you’ve always wanted to learn, get you up-to-date on current technology and trends in your field, and model good life choices for your children.  Just wait until they see you doing homework on a Friday night!

It also doesn’t have to cost an arm and a leg, and you don’t have to try for federal financial aid.  We have a variety of products designed to put some money in your pocket now, whether it’s a home equity loan, a personal loan, or any of our other financial plans.  If you’re thinking to yourself, “But I’ll be 40 (or 50, or 60) by the time I finish,” remember, you’ll be 40 (or 50, or 60) anyway.  


Find out information about our loans that could make it happen.

Your kids are a drain on your net worth, but a blessing in your life.  Let’s face it, kids are expensive. The Department of Agriculture estimates that raising a child born this year to the age of 18 will cost about $250,000.  While a quarter of a million dollars is a lot of money, that only gets them to age 18, but with tuition prices skyrocketing and kids staying at home longer than they have historically, the actual figure of raising children today gets much higher much faster.  Financial analysts predict the average four-year tuition for a public university in 2030 will be $250,000, or about the same as it cost to raise that child from birth to dropping them off at the dorm.  If you have two children, you could easily spend one million dollars on them before they leave college.  In your net worth, this is only reflected as a constant drain on your savings, a net negative.

The value of children is probably pretty obvious to you, but there has to be a way to lower the cost of raising them, right?  First, let’s cut down those college costs, because that’s half the battle.  We’ve got a Coverdell IRA college savings programs that offer good returns while also being tax-deductible.  Getting to $250,000 might seem like a pipe dream, but saving even a little every month can add up quickly, thanks to compound interest.

Next, let’s find a way to save money on school while helping your child now. There are a lot of ways to encourage a gifted child, from tennis camp to musical instruments.  If your child wants to stare at the Internet all day, maybe you should talk to them about a new laptop and some software engineering classes for kids.  If they like the outdoors (or you’d like them to go outside occasionally), try a digital camera.  All of these ideas cost money now, but could result in scholarships down the road, all while giving them a head start on a career or passion they can follow their whole life.  If you’re wondering how you can pay for all of that, check out our savings accounts.  You can contribute a little money every month, and you’ll have enough for those classes or that camera before you know it.

Your home is your biggest investment.  When was the last time you checked up on it?  When you bought your house, it might have been the best available house in the neighborhood for the price. After all, if it weren’t, you would have bought some other house, right?  Is it still the best in the neighborhood for the price?  Is the neighborhood still regarded the same way by home buyers?  How do you know? This weekend, it’s time for window shopping. Take the value of your home from your last appraisal and check the Internet for houses in your area in the same price range.  How does your house stack up? Make a list so you can compare between houses.  Next, check your decor. When you moved in, did the house feel a little dated?  Did you do anything about it? How many of the houses you saw online seemed newer or more fashionable? 

After you finish your house hunting, you’ve got three options:  If you saw a house that you like as much as the one you’re in now, but it’s going for less money, you could think about moving there.  After all, mortgage rates are incredibly low for the time being, and if you could be just as happy in a less expensive house, then that’s money you could use on something else.  If your house is as good or better as the others in the neighborhood, but could use a facelift, you might want to think about remodeling.  Remodeling your home can increase its value and make it easier to find a buyer, so part of what you spend now may come back to you when you sell, with the added benefit of living in a nicer house in the meantime. Finally, if your house is still the best around, think about refinancing while rates are low.  You’re probably not going to find fixed rates this low for a long time (if ever), so locking in that lower rate now can save you tons of money going forward, while cashing out some equity can help knock down any pesky credit card debt you need to take care of, so you only need to write one check every month, while paying far less in interest.

Brought to you by Destinations Credit Union

Your Tax Refund – Why Is It So Small?

/ destinationscreditunion / Leave a comment


This time of year, W-2 forms are coming in, shoe-boxes are coming out and kitchen tables are disappearing under a pile of documents.  It’s tax time, and the most common set of questions we hear revolve around the same issue: Why is my refund so small? How can I make it bigger? While we are not tax professionals, here are some observations we’ve had while serving our members over the years. You may want to discuss them in further detail with your tax advisor. 

Question:  Why is my refund so small?

Answer: There’s no secret to withholding. You tell the IRS factors about your life, your employer holds money back to “guess” at how much you’ll pay in income taxes, and then whatever has been withheld is paid to the IRS for covering your annual income tax burden. If, in fact, you’ve withheld more during the year than you need to pay, the IRS will pay you back any extra income you’ve withheld.

If your tax refund is smaller than you expect, then you didn’t withhold enough money to cover your tax bill. If the amount is surprising because it doesn’t look like last year’s refund, then you probably had something different happen this year. Did you pick up extra income? Did a child move out? Did you stop paying the interest on your mortgage or student loans? Knowing this, if you’re looking for a reason why your refund was smaller, start with the changes in your life.

If you still can’t figure it out, look at how much you made this year as well as your total withholding.  If you made significantly more than last year while withholding the same amount, that could be the reason.  If you want better, more specific answers, take your information to a tax preparation professional. 

Question:  So, should I withhold more?

Answer:  We hear this one a lot. Many of our members were raised on “the IRS savings plan,” particularly if they came from poorer or lower middle-class backgrounds. Families that had trouble getting ahead would plan on tax refunds for a once-a-year spending spree. Now, as the children of those families have grown up, they want to have that type of spree as well.

It’s not a good idea to withhold more money so you can have a bigger refund. In fact, it’s about the worst investment you can make, because you get paid no interest on it. Your money will even lose value due to inflation while the government holds it, so it’s like you paid someone for the privilege of not accessing your money while it earned zero interest. Imagine a free checking and savings account, except the exact opposite in every way: It’s not free, you can’t access it like a checking account, and you don’t earn interest on it like a savings account. It’s a free checking and savings account you set up for someone else. 

Question:  How can I get more money back?

Answer:  The obvious way to get more money back is to find more deductions or withhold more during the year. However, there are other ways to make tax time more profitable. 

Imagine that, instead of withholding an extra $100 every month, you invested it in a savings certificate, money market, or Christmas club account.  Over the course of the year, you’d accumulate $1,200 in principle, just like you’d have an extra $1,200 coming from the IRS. In other words, this method is just as good as the IRS savings plan: If something crazy happens on your tax return or you have some money to avoid a big tax bill, you can have a big annual spending spree.

But it’s better than withholding for a variety of reasons. First, you can access it if you’re putting that money into a money market or other savings program. (Try the high yields on our Kasasa Cash Rewards Checking account with a Saver attached.)  Second, your money will be protected from inflation, and then it will grow. Earnings on different programs vary based upon what you choose to invest in, along with other factors. But even earning a couple of percentage points above inflation could lead to another $100 in your pocket on top of the principle, and save you $100 that you would have lost to inflation. $200 isn’t chump change, particularly on a modest investment, and it could even be more depending upon how much you invest and the program you choose.  Even if you don’t earn much, though, it’s still better than giving that money away.


Even better, you can use that money to double dip.  If you withhold that extra $100 every month, then deposit it into one of our tax-exempt college or retirement savings funds, you can have a big payday while building deductions for next year, so you’ll get even more back.  Obviously, your specific situation will vary and there are limits to how much you can put into each of your tax-exempt accounts, but if you’re interested in starting the snowball effect of compound interest, tax deductions and long-term savings, give Destinations Credit Union a call at 410-663-2500 and we’ll get you set up in no time.  

Finals Week

/ destinationscreditunion / Leave a comment


Around the country, college campuses are finishing their semesters.  While your families are thinking peppermint mochas and gift wrap, you’re probably running back and forth from the library to professor’s offices, maybe also holding a peppermint mocha.  Finals week is no fun.  It’s an unsanitary, stressful, hectic time, in which the weather is usually either overcast or snowy … or both! 

The worst part is that you know most of it could be better, and you know it’s mostly your fault.  You’d probably made plans to start studying earlier, take better notes and generally act more like those students who have it all figured out.  If you’re being honest, though, are you really going to do all that?  The more complicated your resolution, the less likely it is to occur. 

Here’s an easier solution you can actually accomplish in a single day, which will make every finals week so much easier:  Stack your schedule based on the final exam.  Email some of the professors you plan to take in the spring with a simple question:  What is the format of your final exam? 

Knowing this can help you strategize your efforts. For instance, try not to take classes with all multiple choice exams in the same semester, because there’s only so much cramming a brain can do. Try not to take too many classes in which you turn in a final paper, because you can only format so many citations before your hair falls out.  You can even use this strategy to make the whole week make better sense:  If you have to take two math classes and you hate math, schedule them the same semester as courses with final papers.  That way, you can turn in your final papers before finals week begins, and all you have to do during finals week is math.  No distractions! 

You can do a lot of the same things with your budget.  Just like with finals week, the end of the month is the time you make strong resolutions to make better decisions, even when you know you’ll be going out way too late on school nights next month, too.  Of course, going out late on school nights is how you get into trouble with school and money at the same time. 

So, let’s apply the same principles as we did to finals week.  Go through your budget and find out when your bills are due.  You can often change the date with a simple phone call.  Spend some time this month rearranging your bills to come out the day after you get paid, spread out for each of your paychecks. That way, you never see money in your account that you can’t spend, because the money you need to pay the bills will disappear immediately.

College Credit: It’s On The Syllabus

/ destinationscreditunion / Leave a comment

No matter what you ask your professor over the course of the semester, the most likely response you’ll get is something like “It’s on the syllabus.” Yes, professors love to write up big documents governing every aspect of behavior in their class. In some instances, it might seem like the iTunes terms and conditions are easier to get through than that 30-page syllabus. Even worse are the instructors who offer a half-page of instructions while expecting you to interpret in a manner similar to applying the Ten Commandments to a dispute in your fantasy football league.

As exasperating as those syllabi might be, there’s something to be learned from them.  When you have a document that outlines your principles, it helps clarify confusing situations.  Do you have a syllabus in your life?  What is your policy for missing class?  What guidelines do you have for civil behavior?  How do you know if you’re living up to your principles if you’ve never sat down and tried to figure out what your principles actually are?  Without a syllabus, you’re just left to figure out every confusing situation as it comes along.

Your financial life needs a syllabus, too.  What’s your policy on work hours?  Will you pick up a shift during finals week?  Are you willing to quit your job if it interferes with school?  A budget can be your syllabus for spending to answer many of those questions.  For instance, if you know ahead of time that you can spend $20 per month on video games, then you know buying that video game you want this month means that you can’t buy another until the end of the year. It also means that, if you haven’t bought a new video game all summer, you don’t have to feel guilty about buying one now.  

This weekend, put together your syllabus.  Use one your professors have provided as your example … and fill in all the sections.  Start with who you are, what your expected outcomes for the semester are, and determine your tentative schedule.  Don’t worry about some of the odd sections until the end. You can probably find a way to incorporate them – for example, sexual harassment policies might become “dating principles” – but that’s something you can handle later.  For now, try to get down the most important principles to guide your path ahead.

Finally, after you know what you value, put together a budget.  Do you value time with your friends?  Then put more money aside to cover spending leisure time together.  Or maybe you value that time with your friends, but don’t value going out to eat or dancing on Saturday nights.  Maybe your budget should reflect that, so maybe consider putting money aside to host a dinner party or watch football.

Whatever plan you come up with, try not to deviate from it too much once you have it established.  That way, when a strange situation comes up in a few months, you’ve got a list of principles to help your decision process.  Tell yourself, “It’s on the syllabus” and use that to help guide you.  Creating a budget, scheduling your time, and formalizing your principles can be difficult, so drop us a line if you’d like some help.  You can find us here.

What School Doesn’t Teach You About Money

/ destinationscreditunion / Leave a comment


With the new school year either here or just around the corner, it’s time to fill your shopping carts with #2 pencils, protractors and all the goodies the kids will lose by the second day of school.  If they’re headed off to college, it can be even more exciting. But, instead of needing you to replace their pens on day two, your college-aged child will probably be calling to ask for money by then. 

It’s such a ritual that, at this point, many of us don’t really question it. But how much do our kids actually know about money?  You might want to only include the lessons you taught them, because their school probably didn’t teach them much at all.

Common core and other national guidelines don’t include requirements for teaching budgeting skills, how to balance a checkbook, or even explanations of basic concepts such as credit, loans, or mortgages. Basically, the last time your children learned about money at school, it probably involved finding out how many apples and oranges they could buy in some middle school math word problem.

We talked to some credit union members about the lessons they want to pass onto their kids, and below you’ll find some of our favorite lessons to teach your kids. 

  • Pay yourself first.  No one else is going to make you a financial priority, so don’t make them your financial priority.  
  • If you want to know if you can afford something, check your budget. If you have to check your checking account, you can’t afford it.  If you reconcile your accounts every month, you’ll have a pretty good idea how much is actually in each account.  But having enough money isn’t the same thing has having enough money.  Plan ahead. Make a budget. Execute the plan by sticking to that budget.
  • Take risks while you’re young.  You can afford to be more aggressive with your retirement and college funds while you have plenty of time to make it back up, so don’t be afraid to push those funds a little bit.  That said, not saving for retirement is not a risk. It’s just a bad idea.   
  • Make sure the Joneses are keeping up with you.  It’s easy to get lost trying to compete with your peers and almost as easy to ignore those consumer pressures entirely.  But what about the third option?  Instead of ignoring their financial situation, check in every now and then to see if they need help.  Our communities are better when we care about each other.

Whether your kids are in diapers or their kids are wearing them, it’s never too early or too late to teach financial literacy.  Make sure you’re instilling the right lessons, and check back in with Destinations Credit Union, because we’ve always got plenty of resources for young people to learn the lessons they aren’t getting in math class.

Three Ways To Make Your Dorm Room More Like Home

/ destinationscreditunion / Leave a comment
The first few weeks back from break can be tough. It’s a little easier in the fall when there’s the giddy rush of a new school year to distract from how nice mom and dad’s house is compared to your dorm room. In the winter, though, there’s just cold and classes.

Don’t despair! There are a few low-cost hacks that can turn the institutional discomfort of your dorm room into the comfort of your parents’ home. Make a list, pop down to the home improvement store, and check out these three quick fixes:

1.) Soften your bed

Most people don’t get a good night’s sleep in college. Part of it is staying up all night to study, but part of it is the terrible institutional mattresses. Dorm mattresses are somehow simultaneously too rigid and too squishy. Compared to the nice mattress your parents conveniently picked up when you moved out, you may notice your dorm bed is kind of lame.

You don’t need to break the bank on a new mattress. A memory foam mattress topper can give you endless comfort at a fraction of the price. Bedding is frequently discounted as retailers clear out holiday surpluses. Just $50 can leave you sleeping on an inch and a half of pure bliss.

2.) A shower landing place

One of the worst parts of winter is stepping out of a warm shower onto cold tile floors. Your parents fixed this problem with a cushy bathroom rug, but that’s not an option for you unless you want to share it with the whole floor (ick!). What’s a student to do?

Consider a pair of bathroom slippers to complement those sandals. Slippers can help you step out of the shower and onto a cloud. Look for footwear with moisture-wicking soles. Hang them up to dry when you’re not using them.

3.) Fix the lighting

Institutional lighting is the worst. The hum and flicker of institutional lighting is obnoxious. That’s why your parents put concealed, indirect lighting in every room but yours. How can you recapture that feeling?

A table lamp or clamp lamp can get the same charm of indirect lighting without breaking the bank. An LED bulb will last forever and the fixture can be had for as little as $20. Put it on your desk, on your headboard or on your dresser for all-year class.

As you face your back-to-school expenses, don’t forget that Destinations Credit Union can help with your student loan financing!

Take Your First Steps Before They Take Theirs: Financial Planning For The New Parent

/ destinationscreditunion / Leave a comment

The first few days after you bring your baby home is an exciting time that can also be a bit stressful. So can the first few weeks. Many parents also find the first few months stressful, while others are stressed over their parental commitments a while longer. It’s easy to get caught up in sleepless nights, organic baby food, and reading every book you can find, but sometimes parents forget an obvious priority: teaching and helping your child to save money as they grow up.


1.  Set up a savings account for your child and make regular deposits.

You don’t have to know what you want to do with your child’s savings yet. However, the first step is as simple as opening a savings account for your child. Studies show that young adults who had savings accounts as children make better financial decisions, are more prepared for financial emergencies and plan better than their peers who didn’t grow up with savings accounts. So, for now, open a savings account, put a few dollars into it every paycheck and invite your child to participate by making deposits of their own when he or she is old enough. Destinations Credit Union offers savings accounts specially designed for kids. They offer dividend rates and we have educational resources so your child can learn to be smart with their money. You can find out more here: http://www.destinationscu.org/accounts/savings/youth-accounts.html.

2.  Start saving for college now.

Most parents know they need to save for their child’s college education, but few seem to realize how much college will cost. Education costs have been rising much faster than inflation, and if you’ve been out of school for a few years, you might be shocked by the costs. To make matters worse, and more expensive, many universities are receiving fewer public dollars, and getting a larger portion of their income from tuition, thus passing the cost on to students.

All told, experts expect four years of public school to cost around $250,000 by 2030. It could be even higher. While it’s difficult to imagine saving that much money, don’t give up or neglect to even try. First, think of college costs as a pie that’s been split into thirds. The first third will be paid for by your loans and awards your child earns. You’ll pay for the second third using the income you earn at the time. Only one-third needs to come from a college savings fund. Granted, one-third of $250,000 is $83,333.34, and that’s a lot of money. Take a deep breath, because you have decades to save it, and you have a secret weapon: compound interest, which Einstein called the most powerful force in the universe.

Destinations Credit Union offers Coverdell Education Accounts, which allow you to contribute up to $2,000 a year and withdrawals are tax-free.

3.  Focus on what you can control.

If you’ve been a parent for more than a few minutes, you’ve had at least one moment of pure panic while thinking about the future. Perhaps, on one of the few nights your baby allows you to sleep, you decided to keep yourself up by listing every terrible thing that could happen to you, your partner or your child. There’s so much you can’t control, of course, so place your focus on the things you can control.

Disaster sometimes strikes, and when it does, it’s usually unexpected. But there’s nothing you could do to prevent it. We don’t like to think about life ending, but it is inevitable. Instead of panicking over it, plan for it. While you’re at it, start planning for some of the less dramatic problems that might crop up. Start with life insurance, then look into other savings products and programs that are designed to protect your family.

One mistake many new parents often make is to immediately start throwing money at college savings while ignoring their overall financial picture. If you read the numbers in the previous point, it’s easy to see why. Start by building a nest egg that can carry you through 6 to 9 months of lean time, and then build your retirement fund. Money market accounts are a good way to build your short-term nest egg, because you can access your money if you need it.

As for retirement, you may not have given it much thought since your initial conversation with HR. Now is the time to see what else you need. Remember, you can take a loan to pay for college, but you can’t get a loan to retire. Even if you want to put college money away now, you can still get tax incentives if you contribute to your retirement at the same time. Browse Destinations Credit Unions‘s retirement options, or call us at 410-663-2500 if you want some help figuring out what’s right for you.
Sources:

http://finance.yahoo.com/news/why-toddlers-savings-accounts-much-170151606.html

College Credit: Where will you live?

/ destinationscreditunion / Leave a comment


Brought to you by Destinations Credit Union

Top on the priority list for high school graduates is often, “Move out of mom and dad’s house.” And while sometimes mom and dad can’t agree more, this is not always the best financial move for teens.


What are some options for room and board while you are in college? There are plenty. Weighing the financial and personal benefits and downsides to each living situation can help you find the best possible option. Here are some possibilities for you to consider:

  • Staying at Home. This is often the most affordable option, especially if your parents will let you live in their home rent-free. If your college is within driving distance, you can live for free, eat for virtually nothing, and have the moral support of your parents nearby. The downside is being an adult and living in your parents’ home. This is not always an ideal situation for some new college students.
  • Living in the Dorms. The dorm life will help you meet people on campus and make it easier to get involved. However, the convenience comes with a price tag. The cost of living in the dorms varies by college and you often have at least one roommate in a very small room. There’s also the added cost of campus meals plan to consider.
  • Finding an Apartment. An apartment provides you the privacy of a home but at a lower cost than a house or some dorms. Finding a roommate will help defray some of the cost so you don’t have to foot the bill all on your own. The downside is that apartment living can be more expensive than a dorm room when utilities and other expenses are added in. Don’t forget to factor in the cost of food as well.
  • Live with Family. If your college is away from home, living with other family members that reside in or near the college town is a great option. You’ll get to know your extended family a bit more, plus live at a relatively low cost. Perhaps you can babysit for younger cousins to help cover expenses. The downside, again, is living in someone else’s home. If you’re looking to reconnect with family, though, this could be a great option.

Whatever housing option you choose during college, make sure you do your research and find an option that works for you-both financially and personally.

Four Ways To Repay Your Student Loans With Help From Destinations Credit Union!

/ destinationscreditunion / Leave a comment


Graduation day seemed like it would never come. As a freshman, you saw
seniors swaggering about like they owned the place. Then, just a few short years later, there you are. You’ve crammed for your last final, written your last paper and said tearful goodbyes to your friends. For many graduating seniors, though, leaving college isn’t “real” for quite some time.

For many college students, the reality of moving on from college doesn’t set in when they throw a mortarboard. It comes a few months later, when they get their first billing statement for their student loans. Seeing a balance of $30,000 can make the gravity of adult life hit home in a very real way.

It’s easy to put making the minimum payment on auto-pilot and to treat your student loan bill like your cellphone bill or rent payment. It gets sorted into the pile of bills to pay and never gets a second thought. However, you might be leaving money on the table by using the loan company’s bill pay service.

Destinations Credit Union can help you pay back your loan in more ways than you might realize, and save you money in the process. Here are four convenient ways you can pay for your education and get greater flexibility. You might be able to get some extra rewards out of the deal, too!

1.) A savings account for college students

You can’t start paying off your student loans while you’re in college. But that doesn’t mean you have to sit and wait to get buried under an avalanche of debt. You can take proactive steps while you’re in school to make your life easier.

Your student work or part-time job might not make a dent in astronomical tuition costs, but it can still help you get out of debt faster. Setting up automatic savings account transfers will force you to put away a little bit each month. Check out Destinations Credit Union Kasasa Cash or Cash Back (free checking with rewards) to see how you can get extra money for your savings every month.  You can use that once you’re out of school to make a big first payment. It’ll really take the sting out of the debt load.

Make sure to put this money into an account you won’t be tempted to use for other things. The $100 or $200 you put away every month could rapidly disappear through dinners out and concert tickets. Automating savings is a way to keep yourself disciplined and on target.

2.) Automatic bill pay

Your student loan provider is a business, and they’re out to make money. All aspects of their operations, from the materials they send you when you start borrowing to the bills they send you each month, are marketing materials. They’re designed to maximize profit. For lenders, that means keeping you paying the minimum amount for as long as possible.

That’s why their bills make it as easy as possible to pay the minimum and require extra work to pay more than that. They want you to pay the “amount due” every month. It’s more profitable for them that way.

You can get the advantage back by setting up automatic bill pay. When you do, you can designate an amount of your choosing to be paid to the lender every month. You can pay your bill back at your own pace and save some money on overall interest while you’re at it! As a bonus, you can often get around nuisances like “technology fees” with automatic bill payment.

3.) Pay with a Destinations Credit Union credit card

One of the benefits of a student loan is the bump you get on your credit score by paying it regularly. Lenders see your management of student loan debt as evidence of responsible borrowing, making them more likely to trust you in the future. If you want to maximize the benefit to your credit score, you can use a credit card from Destinations Credit Union to make your student loan payments.  You can earn rewards with each “purchase” but make sure you are paying down the credit card as you make these payments.  There’s not much point in trading one kind of debt for another unless there is a long-term benefit.

This advice deserves some qualification. Many lenders don’t accept credit card payments, and many others charge handling fees. A 1% transaction fee for using a credit card should be seen as a 1% increase in interest. Also, credit cards can be an easy way to get into trouble. Don’t use them if you don’t have an emergency fund to fall back on. Credit card interest rates are frequently much higher than student loan interest rates and missing a credit card payment is just as detrimental as missing a student loan payment!

Still, if you’re careful about it, you can build your credit score twice for the same loan. Both your student loan and your credit card will show as paid each month, which will make you look twice as responsible for paying one bill. You will be able to earn a few rewards points as icing on the cake.

4.) Consolidate and refinance

College is about the journey, not the destination. If your journey was a longer one than usual, you may have debt from several places. You may have used your credit card to finance your living expenses or taken out unsubsidized loans from private lenders. These variable interest rate loans can really hurt you financially.

It might be time to consider refinancing. You can take a personal loan for all your outstanding debt and consolidate it into one monthly payment. You can lower your interest rate and simplify your financial life at the same time.

This process can also include one-on-one time with a trained financial professional at Destinations Credit Union. You can gain advice on budgeting and make a roadmap to a truly debt-free future. To see if consolidation is right for you, call, click, or stop by Destinations CU today!

SOURCES:

http://www.bankrate.com/finance/college-finance/repay-college-loans-fast-4.aspx