A couple years ago, my husband and I decided to buy a new TV. Ours was on the fritz and it was approaching the Super Bowl so TVs were on deep discount at Costco. While we hadn’t planned on this expense, between the cushion in our budget and some savings, we were able to pay for the TV out of pocket. But what if we had put this amount on a credit card?
I have to admit that I didn’t give my student loans very much thought until I graduated from graduate school. By that point, I had been accruing debt for nearly six years. In college, even though I knew there was debt involved, I lived blissfully unaware of how much I was really racking up in the background between tuition and living expenses. By the time I got to graduate school, and had the reality check that most college seniors get during their final month before graduation, I was paying a little more attention and tried very hard to be extra careful about my budget so I added as little as possible to my college debt. But still most days, it didn’t register on my financial radar screen.
A few weekends ago, I attend the BossedUp Trainer Certification Program with a bunch of other amazing entrepreneurs, side hustlers, and all around boss ladies. During lunch, I sat next to another trainer who asked: “What do you recommend for people with student loan debt? This is a critical issue and it doesn’t seem like many financial advisors are paying attention to it.” I have to agree. While most financial professionals understand that student loan debt is a critical issue not many people in the financial industry have a lot of recommendations for how to handle this debt well.
Welcome back to our brief series on credit cards! Two weeks ago I took a look at how to evaluate whether or not you really need a credit card, and last week I explored some things to consider as you choose your card. This week, we’re exploring what to do if you end up carrying a balance on your card (or cards) and need some assistance getting out of debt.
Step 1: Know what you owe
I know it may seem obvious but it’s important that you have a solid understanding of what you owe before you can make a plan to pay it off. When you’re in trouble it can be easy to get so overwhelmed by fear that you avoid taking the first step. Avoiding the problem won’t make it go away. Facing it head on, with all of the facts on the table, is the first key to success. You’ll want to know the interest rate, total balance, minimum payment amount, and the balance due date.