| Hi Taylor
- I graduated college last spring with about $60,000 in student loans.
My grace period is about to end and I have to start paying them back,
and I'm wondering about all these email offers I keep getting to refinance.
Should I look into refinancing? Is that worth it?
Hi Henry - Adulthood comes at you real fast once the student
loan payments begin. In the right circumstance, I'm a big fan of refinancing
the loans and saving yourself a little money. Over the life of the
loan, you can save thousands and get the debt off the books much more
quickly. Before you refinance, here are some things to consider.
of debt. If you're looking at a $60,000 tab, that's going
to add up to a lot of interest over time. Anything you can do
to lower the interest rate will be a good idea. One thing to be
careful of is making sure you check the rate on each loan in case
you have multiple loans all bundled by the same lender. Some borrowers
have a $7,000 loan with a rate of 4% and another $8,000 loan with
a rate of 3%, so consolidating both of those at 3.5% isn't going
to do you much good. Lenders can be a little tricky with their
presentation, so you want to be very clear on your loan amount
and how everything is structured.
2. Refinancer. Don't just go with the first loan consolidation
offer that hits your inbox, because not all financiers are made
equal. Even a reputable company might not be the best choice for
you, depending on your loan amount and what your degree is in.
For example, Splash Financial is a solid refinancing company that's
especially good for people out of medical school. Whatever you're
looking to do professionally, there might be an industry-specific
consolidator you should look at. This is a really important decision
and you owe it to yourself to do the research before pulling the
trigger on some bank you've never heard of.
3. Don't stop at refinancing. Refinancing can definitely
save you money. You know what saves you more money? Paying off
the debt once and for all. Like I said, I'm a big advocate of
lowering your interest payments, but you still have to make those
monthly payments and do whatever you can to get the debt paid
off as quickly as possible. I understand this is easier said than
doneit's all but impossible to land a high-paying job right
out of college. Whether it's working more or spending less, I
encourage you to focus on paying that debt down and becoming financially
free as soon as possible.
| My guess is
that you would do well to refinance. Check out Splash Financial and
some other refinancing options and compare their offers, then go for
it when you find something that's a good fit. Good luck, Henry!
Information presented is for educational purposes only and is not
an offer or solicitation for the sale or purchase of any specific
securities, investments, or investment strategies. Investments involve
risk and, unless otherwise stated, are not guaranteed. Be sure to
first consult with a qualified financial adviser and/or tax professional
before implementing any strategy discussed herein. To submit a question
to be answered in this column, please send it via email to Question@GoFarWithKovar.com,
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