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At the end of each year, I review my personal finances to see how I’m progressing towards my goals. I also take stock to see if I need to make any course corrections. I refer to this annual ritual as getting my financial house in order. It has proven to be a worthwhile exercise over the years. It’s helped me navigate the inevitable peaks and valleys, and also review my financial goals annually. It especially helped when it came to handling student loan debt.

Student Loan Debt

While I am no longer handling student loan debt, there was a time when I did. While studying for my bachelor’s degree, I borrowed money to help pay for tuition, fees, and housing expenses. Fortunately, I was able to work part-time in school, and full-time during the summers. When I graduated, I had what I considered a modest level of debt.

The Realization of Repayment

After graduating, I remember receiving my student loan statement and payment slips in the mail. It had been several months since graduation. I hadn’t thought much about handling my student loan debt. Because I deferred my principal and interest payments while in school, I didn’t know exactly how much I owed. I didn’t even know when my payments were due. I can still remember looking at my loan statement and seeing how much I owed and the monthly amount due. Then, I counted the number of payment slips. I realized it was going to be quite some time before I could pay my loans off in full.

Reality set in. Having taken some finance classes while in school, I knew the high interest rates on my loans would cause interest to accrue rapidly on the remaining principal balance. The longer it took me to pay off my loans, the more it would cost. So, I sat down and developed a plan. I set up a monthly budget to manage my finances and pay off my student loans as soon as possible. This was the start of getting my financial house in order.

Discovering Repayment Options

Since that time, student loans, both federal and private, have greatly evolved. There are now many more repayment options available to students and parents to help them handle student loan debt. These include various income-driven repayment plans, federal loan consolidation, and private student loan refinancing. Each of these options has distinctive features and eligibility requirements, so it makes sense to compare them to one another to see if any meet your needs. You can learn more about federal student loan repayment plan options by visiting the Department of Education’s Federal Student Aid website. Learn more about student loan refinancing and loan consolidation, and which one may be right for you.

Making a Repayment Plan

Creating a solid financial plan and sticking to it is an important part of any person’s financial well-being. If you haven’t already done so, I highly encourage you to review your financial situation, create a plan, and set a monthly budget.

Once you’ve created your plan, be sure to review it at least once per year, as your goals and/or financial situation may change. This way you can make any needed adjustments to ensure you stay on track. By keeping your financial house in order you can increase the likelihood of achieving financial success.

Does your January credit card statement have you feeling blue? Find out how personal loans could provide credit relief.

It Happens to the Best of Us

The holidays have come and gone. You may be feeling a bit relieved that all the seasonal hustle and bustle is over. Sure, it may be a bit cold outside. Sure, work is back in full swing. But, things are looking good with your New Year’s resolutions. You’re feeling optimistic and energized.

Then, you receive your January credit card bill. Whoa, the new balance is much higher than you expected. As you go down the list of purchases on your statement you ask yourself, “Did I really spend that much?” You also notice the available credit on your credit card is pretty low. There are some big purchases coming up in your future. You were planning on using your credit card to pay for them. Now, you no longer have enough available credit to pay for everything as planned.

With average credit card APRs over 16%, and many exceeding 20%, you know if you don’t pay your balance in full you’ll be hit with a hefty finance charge, which will be added to your outstanding credit card balance. And even worse, if you’re late making the minimum payment that’s due, you could be hit with a penalty APR, which can be as high as 29.99%.

Personal Loans Could Provide Credit Relief

This is where personal loans could provide credit relief. Unlike a credit card, which is a revolving line of credit, a personal loan is an unsecured loan that doesn’t require any collateral, such as a car or house. Personal loans come with a specific repayment period, usually between 1 and 7 years. Fixed interest rates are more common than variable interest rates, and some lenders will offer you a choice.

The main reason people take out personal loans is to pay off existing debt, such as high interest rate credit cards or loans. Other common reasons include making major purchases, for home improvement projects, for special occasions like weddings, to take a vacation, and to pay off medical bills.

Personal loans can range from as little as $1,000 to as high as $100,000. APRs vary widely among lenders and are based on the borrower’s (or co-signer’s) credit history, annual income, repayment term selected, and type of interest rate chosen. Some personal loans even come with money saving automatic payment discounts and loyalty discounts.

Tip: Some lenders charge upfront fees, which add to the total cost of the loan, so be sure to take that into account before choosing a lender.

A really nice feature for personal loans is how quick and easy the process can be. If you submit a completed loan application, you can receive a decision in a matter of minutes, and if approved, receive funds in your bank account as soon as the next business day, provided your application has no typos or errors.

Now that the holidays are over, you may be suffering from the post-holiday credit card blues. If so, check out a personal loan for credit relief from U-fi From Nelnet’s partner. It just may be what the doctor ordered.

Winter break is often a favorite time of year for college students. It’s a chance to go home, visit family and friends, enjoy home-cooked meals, and maybe do a little holiday shopping. Unfortunately, working off that extra helping of pumpkin pie may be easier than off your holiday spending.

5 Holiday Spending Tips

As you prepare to enjoy the holidays, these tips can help you avoid spending traps. Here’s how you can ring in the New Year without a mountain of debt and  holiday spending regret.

  1. Don’t use student loans to pay for a holiday trip or gifts.

    Using a student loan to finance a trip over the holiday break or a shopping spree might be tempting. But remember, your student loan is intended for educational expenses. Plus, you really don’t want to take on student loan debt for a short term benefit that you’ll be paying back for 10-plus years with interest.

  2. Avoid paying for everything with a credit card.

    Much like using a student loan, you’re better off to simply pay with cash and avoid using a credit card for holiday expenses. Credit cards will typically have high interest rates, especially if you carry a balance. If you can’t pay cash for your holiday purchases, it’s probably not worth the cost.

  3. Don’t feel obligated to buy gifts for all your friends and family.

    If you’re a student, your friends and family understand that you’re on a tight budget and may not have the resources to buy gifts for everyone. Simply spending some time with friends and family will likely be more meaningful than any gift you could purchase at the mall. Find ways to do small but meaningful things that will be appreciated.

  4. Don’t forget to set a budget or spending limit.

    It’s important to know in advance what you can reasonably afford to spend. It’s a good idea to set a budget for yourself and cap your spending at a certain dollar amount. That will help keep you on track and also let you plan better for the people on your gift list, and possibly help you cut back on the number of people on your list. Some families draw names for gifts or find other creative ways to help family members keep their expenses down and enjoy their time together.

  5. Avoid paying for gift wrapping or expensive gift bags and cards.

    It’s convenient to drop your gifts off and have someone else wrap them. However, there’s a cost for convenience and it simply might not be worth paying for. Buying wrapping paper after the holidays is a great way to save money and plan ahead for the next year. Plus, if you plan and don’t make all your gift purchases at once, you won’t be bogged down wrapping a lot of gifts at the last minute. Often, a card and a gift bag may actually cost more than the gift you’re giving.

With a little discipline and planning, you can set yourself up for a fun-filled holiday season without incurring the stress of spending too much or putting yourself into debt. Remember to enjoy the holidays and the time spent with friends and family. Many times, the best gifts are the ones that don’t cost anything at all.