The Allstate Blog » Personal Finance

Financial Protection When You’re Between Jobs

Brendan — Thu, 16 May 2013 11:00:03 +0000

When you’re between jobs—whether due to a layoff or a decision to leave—you may have special financial challenges to consider. Your income is likely less than it was while you were working, but that doesn’t have to mean derailing your retirement goals or foregoing insurance. There are some strategies that can help you keep your retirement savings and insurance coverage working for you, even when you’re not. Retirement Savings When you leave a job (voluntarily or otherwise), you typically have a few options for the 401(k) at your old employer. If the employer allows it, you can leave the funds where they are. Another option is to roll over your 401(k) into an Individual Retirement Account (IRA) so that the money continues working for you in a tax-deferred manner. Liquidating your 401(k) is an option but there may be tax implications and early distribution penalties. It is best to consult your tax professional before making any distribution decisions. To continue contributing to an IRA or 401(k), you need earned income, such as a salary or profits from a small business. Unemployment benefits are not considered earned income by the IRS, so if that’s your only source of income, you would have to temporarily pause contributions to your IRA or 401(k). However, if your spouse has earned income, he or she could potentially bump up retirement contributions to compensate. If you re-enter the job market, you could resume contributions to your own retirement account. If you’re 50 or older, you can also make catch-up contributions to a 401(k). Insurance Depending on the size of the company, employees who are laid off or leave a job voluntarily often have the right to continue their health care coverage for a specified period of time through COBRA. However, health insurance doesn’t cover everything, especially in the case of an accident or serious illness, so a supplemental health insurance policy could help fill coverage gaps such as co-pays, deductibles and non-medical care (transportation to treatment, for instance). Knowing your medical costs would be covered can help provide peace of mind during an uncertain time. Premiums for supplemental health insurance can start as low as $20 per month. Life insurance is another area to consider. If you had a policy through your previous employer, you may want to consider buying an individual policy to ensure that your family would be able to cover their daily expenses if the unthinkable happened. A permanent life insurance policy can accumulate cash value over time so that you might be able to take a loan or withdrawal if needed. Want to know more about your retirement and insurance options? Contact an Allstate personal financial representative to discuss your needs.

How to Start Improving Your Credit Health Right Now

Bethy Hardeman, CreditKarma — Wed, 24 Apr 2013 11:00:41 +0000

You might not think about your credit that often, but when it comes time to apply for a loan it’s a top priority. The thing is, if you wait until that moment to concern yourself with your credit health, it’ll may be too late to do anything about it.

So instead of waiting until you need it, anticipate that someday you’ll probably apply for a mortgage or auto loan—or even a credit card—and take a few steps to start improving your credit health today.

Get rid of credit errors.

Get in the habit of checking your credit report on an annual basis to make sure that it is accurate.

Check your three, free credit reports from AnnualCreditReport.com. You’re entitled to these once per year. After you’ve pulled your reports, go through them thoroughly to check for errors. You should look out for things like accounts you don’t recognize, late payments on accounts you’ve always paid on time, erroneous derogatory marks and even incorrect personal information. Small errors, like a wrongly reported mailing address, shouldn’t affect your credit score. But an incorrectly reported account could.

If you spot an error, use the FTC’s guidelines for disputing it with the credit bureau. If that doesn’t work, you can also go directly to the information provider to see if they’ll stop reporting the incorrect information.

Spot future errors early on by getting a credit monitoring service, like Credit Karma’s free one. You’ll be alerted to important changes on your credit report and can act quickly if you don’t recognize them.

Get a higher limit.

One of the most important factors of your credit score is your average credit card utilization rate. This percentage shows creditors how much of your available credit you’re using. Ideally, you should keep this number to less than 30 percent for good credit health.

One way to ensure your credit utilization stays low is to get higher credit limits on your credit cards. This should not lead you to spend more on your cards; it should just give you a nice buffer to stay well below a 30 percent utilization rate.

Most credit card issuers review and raise credit limits every six months or so. If it’s been a while since your last credit limit increase, try the direct approach. Call up your credit card company to request one, calling out your responsible credit behavior. Keep in mind that a request like this can sometimes result in a hard credit inquiry, which will ding your score a few points.

Use your old credit cards.

Unless you have a really good reason for closing out an old credit card account—like a high annual fee, for instance—keep these cards open and active. Creditors like to see long credit histories, especially if they’re clean. But it’s not enough to just keep old cards open; you also have to use them. The reason for this is that some credit card companies will close out inactive cards or at least stop reporting them to the credit bureaus. This can unexpectedly reduce your utilization rate, too.

Make a small purchase or two on your oldest card, or set up a recurring charge like a gym membership. Just make sure to pay off the balance each month.

Bottom Line: This should give you a good start in improving your credit health. Of course, make all of your bill payments on time; that’s the best way to maintain good credit health once you have it.

Bethy Hardeman writes on credit, personal finance and the economy for CreditKarma.com, a free credit management website that helps more than 8 million people access their credit score for free.

Bethy Hardeman is not an Allstate employee and does not represent Allstate. She did not receive monetary compensation for this post.

4 Ways to Use Your Tax Refund Wisely [INFOGRAPHIC]

Brendan — Fri, 12 Apr 2013 17:00:32 +0000

Tax time may not actually be 'fun,' but once the process of filling out all those forms is completed, dotting the Is and crossing the Ts, many of us have a refund coming our way. With the average tax refund near $3,000, it's important to put that money to use in the best way possible. For some that means paying down credit cards, for others it means putting it toward retirement. In any case, many options should be considered and evaluated. Here's a brief look at 4 wise ways to use that money. [infographic]

5 Tips to Protect Your Identity at Tax Time

Melissa — Thu, 28 Feb 2013 12:00:23 +0000

Whether you owe money or are expecting a refund, preparing your tax return on your own or hiring a professional, tax time can be, well, taxing. The last thing you probably want to worry about is identity thieves tapping into your financial accounts, opening new lines of credit or committing other types of theft or fraud. But according to Identity Theft 911, tax season is a prime opportunity for identity thieves. W-2s and other Internal Revenue Service tax forms contain a wealth of information--everything from Social Security numbers to financial account information--that can be a target for resourceful criminals. Protecting your identity, however, doesn't have to be difficult. Follow these simple steps to help safeguard your personal information from hackers and identity thieves during tax season. 1. Be vigilant with your information online. According to the IRS, impersonation schemes thrive during tax season. This is when thieves claiming to represent the IRS send emails, make phone calls or send traditional mail in an attempt to steal people's Social Security numbers or other sensitive personal information. However, it's important to remember that the IRS says it does not contact people by email or social media, so, if you're the recipient of any electronic messages, you should know that they are fraudulent. If you suspect that a piece of mail you’ve received is part of a scam, you can visit IRS.gov for information on how to determine whether it is authentic. 2. Keep an eye on your mailbox. While cyber-crime has become many thieves’ preferred method of obtaining personal information, it's still important to closely monitor your mailbox. All official tax forms are delivered by mail, and some thieves find it easier to simply open someone's mailbox and steal their forms than figure out Internet passwords in order to reap personal information. 3. Leave your Social Security card at home. According to the IRS, you should not, at any time, carry your Social Security card in your wallet or purse. The card should be kept in a safe place, preferably in a safe-deposit box or another secure location. If your Social Security card is in your wallet and your wallet is stolen, then it’s possible your personal information can fall into the hands of identity thieves. With your Social Security number, a thief can compromise your bank account and open new lines of credit. 4. Be crafty with your password. Refunds from electronically filed tax returns are typically direct-deposited into financial accounts, which can help protect a refund check from being stolen from your mailbox. However, if you e-file, you need to know how to do so safely. One way to protect yourself is by creating a strong user password on the website through which you file your tax return. To ensure Internet security, incorporate a series of numbers, letters and punctuation marks into your password. 5. Know your tax preparer. Fraud rings have been known to front as tax preparation centers. Scam artists prey on the unsuspecting customers of these centers, stealing personal information and sometimes redirecting their tax refunds. According to Forbes, there have also been instances when a corrupt tax preparer has sold a client's information to a criminal, who then used the information to file for a fraudulent tax return. The bottom line? It's a good idea to research your tax preparer or accountant and make sure he or she is legitimate and ethical. In addition to taking steps to thwart tax-time identity thieves, you may also want to consider purchasing identity theft restoration coverage, which can alert you to potential fraud and help you repair any damage to your identity in case you do become a victim.

Financial Tips for the Newly Single and Over 50

Brendan — Tue, 26 Feb 2013 12:00:26 +0000

Divorce can throw a wrench into even the most careful financial planning. If you’re newly divorced, you’ve probably had to deal with dividing assets, such as investments and retirement accounts, and setting up separate households, not to mention the emotional fallout of ending a marriage. Here’s a look at several steps you can take to get your finances back on track after a divorce. Consider Life Insurance Life insurance is especially important if you have dependent children who may be relying on you to cover their daily expenses or educational costs. Life insurance could also prevent you from becoming a financial burden on other family members, because your beneficiaries could use the proceeds to cover your final expenses, such as burial or funeral costs. That money could also be used to settle any debts you might leave behind. Investigate Health Insurance If you were covered under your ex-spouse’s employer health insurance policy, you may need to secure new coverage once the divorce is finalized. If your ex-spouse’s company has 20 or more employees, you may be eligible to continue coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA), provided you notify the health plan administrator within 60 days of becoming divorced. However, under COBRA, you will be responsible for the entire amount of the premium, which is the monthly payment, so it may be more economical to secure coverage on the individual market or through your own employer. You may also want to beef up your health insurance coverage by adding supplemental health insurance. In the event of a serious injury, supplemental health insurance would help fill coverage gaps like co-payments, deductibles, and nonmedical care, such as transportation to treatment. Explore IRA and Social Security Options If you were married for at least 10 years and have not remarried, you can claim Social Security benefits on your ex-spouse’s record starting at age 62, regardless of whether your ex-spouse has remarried or not. But Social Security checks may not cover all your expenses during retirement, so it’s often a good idea to use other retirement savings vehicles, such as Individual Retirement Accounts (or IRAs). IRAs are a tax-advantaged way to save for retirement that allow you to choose the investments in your account and supplement employer-sponsored retirement accounts, including a 401(k) or 403(b). The maximum IRA contribution for 2013 is $5,500, but if you’re over age 50, you can also make catch-up contributions to a traditional or Roth IRA up to $1,000. By taking these steps now, you’ll help ensure greater financial independence and security during and after this difficult transition. Want to know more about insurance and IRAs? Contact an Allstate personal financial representative to discuss your needs.

Has Your Child’s Identity Been Stolen? Know the Warning Signs

Melissa — Wed, 13 Feb 2013 12:00:04 +0000

Many of us have heard the warnings about identity theft. But, did you know that your children can fall victim to identity theft too? Recent statistics show that it happens. Carnegie Mellon University's CyLab found that 10.2 percent of 40,000 children involved in a 2011 study were victims of identity theft. Childhood identity theft can have devastating long-term financial implications. It can affect a child’s ability to take out a student loan, receive a scholarship or get a credit card. Identity theft may even impact future job opportunities.

Child Identity Theft Warning Signs

How do you know if your child’s identity has been stolen? Be vigilant about protecting your child's identity, and watch for the following red flags:

Unsolicited credit card offers. Have you received one or more unsolicited credit card offers in your child’s name? Credit card offers are never intentionally sent to minors.
Social Security account statement. These statements track annual contributions and anticipated benefits. Unless your child has a part-time job, an earnings statement in your child’s name is a clear indicator of fraud.
A bill or a collection agency call for your child. Don’t dismiss this as a case of mistaken identity. A call from bill or collection agency can be a clear sign of identity fraud.
The Internal Revenue Service contacts you about your child. If the IRS informs you that your toddler hasn't paid his income taxes, this is a warning sign that someone may be masquerading as your son.

Tips for Preventing Child Identity Theft

Identity protection for your child starts with some privacy precautions. Here are some tips that may help reduce your child’s risk for identity theft:

Be proactive. Start by checking with the fraud divisions of all three credit reporting agencies: Equifax, Experian and TransUnion. Credit reporting agencies typically do not keep a report on file for minors. If there is a report, then there’s a good chance that your child’s identity is compromised.} And consider purchasing identity restoration coverage, which can help protect you and your family against identity theft and help repair any damage to your identity. Talk to an Allstate agent for more information.
Be cautious when giving out your child’s Social Security number. If a school, youth sports team, or a medical office asks for your child’s Social Security number, know that it’s OK to question why they need it, what they will do with it and how they plan to keep it safe.
Shred anything with your child’s personal information. Shred forms, documents and mail before disposal.
Never carry your child’s Social Security card. To help reduce the risk for theft; leave you child’s card -- and the cards of all the members of your family -- in a safe place, like a safe at home or a safe deposit box.

What to Do If Your Child's Identity is Stolen

If you find out that someone has stolen your child's identity, there are some steps you can take to minimize the damage. If you discovered that a credit report (fraudulently) exists for your child, contact any one of the three major credit bureaus (that bureau is legally required to alert the other two) and ask them to put a "fraud alert" on the file. Report the identity theft to the FTC. Also, contact your local police department to file a report. By taking a few simple proactive steps, and staying alert to early warning signs, you can minimize your child's risk for identity theft or the impact it will have should it ever occur. What concerns you most about someone's stealing your child's identity? Share your thoughts below.

Thinking About Early Retirement? A Few Things to Consider:

Sue — Thu, 24 Jan 2013 11:57:33 +0000

Early retirement isn’t for everyone. But for those who do dream of it, it’s an idea that sounds very enticing. If you’re thinking that you’d rather not spend your sunset years toiling away at a 9-5 job, you have options. Just don’t give your notice until you’ve considered some of the following factors involved in granting yourself an early release from the workforce.

You can’t begin to claim Social Security benefits until you’re at least 62

This means is that if you decide to retire from your career at the age of 59, you’ll have three potentially long years to wait before you can begin to receive monthly Social Security checks. Unless you’re in line to receive a generous pension from your employer or have a lot of money saved up from years of penny-pinching, coupon-clipping and resisting impulse shopping, you may have no choice but to keep working until you are 62 -- or even older.

If you retire before 66, you won’t get your full social security retirement benefit

In other words, the monthly check you’ll get from the Social Security Administration won’t be as high if you retire before 66 as you’d receive if you wait until reaching the full retirement age, which is determined by the year in which you were born. Although the checks will begin to increase in value the closer you get to 66, it’s an incremental process. For example, if you retire at the age of 62, you’ll only receive 75 percent of the full value of your Social Security earnings. If you retire at 63, that amount rises to 80 percent. At 64, you’ll get about 87 percent, and at 65, around 93 percent. There are plenty of retirement age and income calculators available online, include this one from Allstate Financial, which takes a snapshot of what you have and helps you make the most of it.

Give careful consideration to health care

Medicare doesn’t kick in until you’ve turned 65 – but what are your options if you choose to retire early and are still years away from that age? If your current employer’s pension plan offers medical coverage, this is likely going to be your best option, as long as it’s affordable. But, if health care isn’t offered, or if it’s too expensive or is only offered for a short period of time, that’ll leave you uninsured until you’re eligible for Medicare. You may be eligible to get group health insurance as a paying member of the American Association Retired Persons (AARP). There’s also this: If you’re retiring within 18 months of your 65^th birthday and your employer isn’t offering a retirement health care package, you could always pay for COBRA benefits to bridge the gap to Medicare coverage. Needless to say, this is expensive, but it may be a better option than crossing your fingers and hoping you won’t get sick between now and then.

Keep in mind the reality of inflation

If you decide to retire at the age of 55 and have a nest egg of a $250,000, you may want to consider: How far will that money get you in another 20 years, when inflation has its way with the cost of living, and what’s affordable now may be downright expensive then? As a rule, whenever you’re planning your retirement – early or not – it’s critical that you take into consideration what inflation will do to your savings much further down the line. Check out this inflation calculator from the Bureau of Labor Statistics to get an idea of what you may be looking at and how far your dollar will take you in a couple of decades. Early retirement may be doable, as long as you’re willing to do the math and plan far in advance. Whether you’re 25 or 55, it’s never too early to start planning ahead. The sooner you do, the better chance you’ll have at spending your sunset years enjoying yourself instead of losing sleep over money. Recommended by the Editor:

How to Go to College for Less

Sue — Tue, 15 Jan 2013 12:00:07 +0000

Outside-the-box strategies for saving money on college.

As the mother of two teenagers, news of rapidly increasing college tuition and the threat of high interest rates on student loans have me thinking about how to afford to pay for their education. Juggling the costs of a mortgage, a car payment, the needs of two growing children and various other expenses makes it hard to save for college, too. I don’t want my kids to start their young adult lives with a large burden of debt, and I also don’t want them to have to pay more than they have to as they strive for that all-important university diploma. After doing some research, here are some outside-the-box ideas on how to go to college for less:

Keep an open mind about private vs. state schools

Private schools seem synonymous with expensive tuition, so I thought they may be out of the question – but that’s not necessarily the case. Kevin Campbell, president of College Planning Authority, a college planning company based inTexas, says shying away from private schools because of the sticker price could be a mistake. “If you have a high-performing student who can get into the higher-end schools, they often have excellent financial aid,” he says. “We often send students to private schools for the same or less than a state school.” In comparing financial aid packages, be sure to ask if the aid is renewable or has any grade-point average requirements so you won’t be caught off guard later on. On the other hand, Zac Bissonnette, author of “Debt-Free U: How I Paid for an Outstanding College Education Without Loans, Scholarships, or Mooching off My Parents,” says students are most likely to get merit-based aid at schools where they’re in the top 10 percent of the incoming class, which some students wouldn’t want to attend. “If you get into a school that’s sort of a reach for you academically, you’re not going to get much merit aid,” he says. “For most families, the best thing to do will be to pick an affordable, in-state college.”

Consider studying outside of the United States

As tough as it might be to consider being an ocean away from one of my kids for four years, it could be a good way to reduce college expenses. Since college tuition in this country has risen faster than in other parts of the world, some students now choose to attend college in places likeEngland,ScotlandorCanada. “Particularly for students looking at international business, I think it starts to make a lot of sense,” saysCampbell. But, he adds, it might not be the best option if your student’s chosen career requires professional certification in theUnited States. “For instance, if you’re an engineering student, make sure the licensing agency will accept your education from out of the country.” Plus, if you want to be able to visit often or fly home for Christmas, Bissonnette cautions that travel costs back and forth could also add up quickly while attending school in another country.

Lower your expected family contribution (EFC)

Your EFC is calculated based on your answers to the Free Application for Federal Student Aid, or FAFSA, and deducted from the cost of attendance at a given school. If the COA exceeds your EFC, then your student is considered to have financial need, which could boost eligibility for grants, loans and scholarships. Campbell suggests using an online EFC calculator or working with a college planner who can explain “what assets count against you and which ones don’t.” For instance, investing in a qualified retirement account such as an IRA or 401(k) could lower your EFC, as could having more than one student in college at the same time.

Graduate Early

Spending less time in college can reduce the cost – so it may be worth encouraging your kids to do what they can to earn university credits before they even graduate high school. According to theNationalCenterfor Education Statistics, the median time it took for 2008 bachelor’s degree recipients to graduate was just over four years. Almost a third of first-time bachelor’s degree recipients took 49 to 72 months to complete their degrees, so graduating early (or at least on time) could help save money. “One of the ways to graduate early is to take summer classes through your local community college and transfer those credits,” suggests Bissonnette. Earning Advanced Placement or International Baccalaureate credits during high school can also help, depending on the college’s policies. Taking fewer credits each semester might allow your student to work his or her way through school and spread out the tuition burden, but unless they’re living at home, room and board could still account for a large portion of college costs. So, while heading off to college will undoubtedly come with a large price tag, taking a unique approach to funding your kids’ college education could reduce the debt load they have to pay back once they’ve got their diplomas in hand. Are you planning for your child’s education – or your own? Visit myallstatefinancial.com for information on starting a college savings account.

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Debt Counseling: How it Can Help You

Brendan — Wed, 09 Jan 2013 12:00:35 +0000

If you’re among the millions of Americans struggling with consumer debt, a debt counselor may be able to help you get your finances back on track. Dafne Torres, director of customer care at the Florida-based nonprofit InCharge Debt Solutions, says debt counselors work with clients on a variety of financial issues. “We have clients who are looking to buy a home, so they’re trying to improve their credit and have more money available,” says Torres. “We have other clients who can’t afford their monthly payments or are seeking assistance with their interest rates.” (However, debt counselors generally can’t make your loans disappear entirely or negotiate student loan debt or money owed to the IRS.) Here’s a look at some of the services offered by debt counselors:

Debt counseling: Counselors can typically advise you on credit card debt, home-foreclosure prevention, and in some cases, help you determine if you can afford to buy a home.

“We go through their financial situation, do a budget and create a personalized plan, providing the pros and cons of each solution,” says Torres. Some debt counselors are approved to conduct a bankruptcy pre-filing credit counseling session, which is required before you can officially file for bankruptcy. InCharge, for example, charges a small fee for bankruptcy counseling sessions, but the other counseling options are free.

Debt management:In a debt management program, the debt counselor negotiates with each of your creditors to get a lower interest rate and to consolidate your loans. You send a monthly payment to the debt management program and they disperse funds to all your creditors. (There’s usually a fee for this, so the savings on interest rates should outweigh your monthly fee for the debt management program.)“Normally, we see a monthly payment reduction of $100 to $150,” says Torres. “When it comes to interest rate savings, that’s where the big savings come in. We can help them pay off an account in five years that would have taken them 20. Sometimes, they can save $10,000 to 13,000 throughout the period of their loan.”

All too often, says Torres, people get in over their heads before seeking out a debt counselor, which is often at the suggestion of their lender. “The majority of people wait until it’s too late,” she adds. “It’s a little bit embarrassing to have to call someone that you don’t know and tell them you’re struggling with debt. By the time they do it, it’s really because they’re forced to.” However, debt counselors can help even before you find yourself drowning in debt. “People can call us at any time,” says Torres. “We can help them in any facet of their life, even if they don’t have a lot of debt but they just need some guidance.” If you are working to improve your financial situation, consider these suggestions on how to reduce your debt. Even though you think certain financial options may be out of reach, it may still be a good idea to think of ways to save for retirement, as well. Visit MyAllstateFinancial.com's section on College and Retirement Savings Plans and IRAs for more information.

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5 Tips to Manage Student Loan Debt

Lindsey — Wed, 26 Dec 2012 12:00:27 +0000

College was a great time in my life – but as the excitement of graduation neared, my student loan debt loomed. I owed tens of thousands of dollars for my education; would I be able to afford to pay a monthly bill of hundreds of dollars each month? Would I ever be able to pay it all back? Lots of young adults are in the same boat. According to the Federal Reserve Bank of New York, 2011 graduates with student loans owed an average of $23,300—quite a significant sum, especially at such a young age. For many young people, that debt causes a lot of stress, which can affect their physical and psychological health, too. “Money is one of the biggest sources of stress for Americans. And when you’re young, it’s really easy to want to spend your money on pleasurable things and not commit to the things that aren’t as fun, like paying back student loans,” says Eve Adamson, author of 365 Ways to Reduce Stress. Luckily, I was able to find a good job after graduation, but even with a steady income, juggling living expenses and student loan debt can be tricky. When my younger sister graduates from college next year, I will be able to pass on some advice.

Budget

The first step you need to take is to put yourself on a budget. The more money you can sock away each month, the more you’ll have to pay off your student loan debt. Here are some other steps from The Project on Student Debt that helped me manage my student loan debt:

Organize

Keep track of your loans. Be aware of how much money you owe. It’s important to keep track of the lender, balance and repayment status for each of your student loans. That way, you can stay on top of your debt and follow the repayment schedule you established for each loan. You can keep track of your federal loans with the National Student Loan Data System for Students. For your private loans, keep a copy of all the paperwork you receive. Also be aware of the grace period on each of your student loans, so that you can make payments on time. To get an idea of how long it’s going to take to pay off your student loans, use a student loan calculator.

Communicate

Communicate with your lender. It’s important to maintain a dialogue with each of your lenders about your student loans. Part of the lender’s role is to help you establish an executable plan to pay off your loan. That means you should be working with your lender—not against—to pay off the debt. Be upfront about issues that you encounter, and your lender should help you reach a solution and avoid defaulting on your loan. Defaulting, which occurs after you fail to make payments for nine months, can ding your credit score and cause the total amount of money you owe to increase dramatically.

Adjust

Adjust your repayment plan, if needed. Most student loans come with a standard 10-year repayment plan. If you don’t think you’ll be able to pay off the loan in that time frame, discuss alternative options with your lender. One potential solution for federal loans is adopting an Income-Based Repayment plan, which takes your income into consideration and can help make sure your loan payments will cost less than 10 percent of your income. Enrolling in an IBR plan can also mean that any remaining debt, after 25 years of qualifying payments, is forgiven. Talk to your lender to see if this is an option for you.

Prioritize

Start with the most expensive loans. Prioritize and pay off your most expensive loans first. That means starting with the loan that carries the highest interest rate (most likely, it’ll be one of your private student loans). Paying off this loan first will enable you to minimize the total interest you’ll have to pay off over time. So, while the process of paying off your student loans can seem endless, making a plan can make it seem more manageable. How are you handling paying off your student loans? Share your ideas in the comments below. Recommended by the Editor: 3 Ways to Get More from a College Education Saving for College: Where Do You Start? 11 Easy Ways to Get Poor 7 Ways to Stay Motivated As You Get Out of Debt