What kind of debt do you have?

[klacey1]

Curious what your major is - $100,000 is a lot of debt unless you are going to be making a great salary! I get nervous when I see my kids' college aged friends taking on over $100,000 in college debt when they are Psychology, Criminal Justice majors etc. Plus you will be getting married sooner or later and taking on debt for a house, cars etc.

Hey, I was an English major and don't have an extremely high paying job. I have about $60,000 left to pay on my student loan (started with around $85,00ish)-- high student loans are just a terrible fact of life for many now. It's just another bill that I pay. Sucks, and I'll probably be paying it off in my 40's, but I just look at is as a bill-- like rent, utilities, etc. DBF and I live together and split all bills. We still go on vacations, etc. and make it work.
I have no car payments, and DBF has $238 left on his car (one more payment!! ) We rent, so no mortgage. I have $1,000 on a very low interest credit card (can use BoA's student deal because I am in grad school) and DBF has zero (he lives credit card free).

 

[ssawka]

If you can swing it, buy a house as quickly as you can. Housing prices are still pretty low, but will move back up again. When that happens, you will be able to refinance and roll your student loans into your mortgage. That's what we did! We bought our house two years after graduating before the "bubble". Within 3 years, the housing prices started going up, and interest rates started coming down. We refinanced and rolled all of our student loans into the mortgage. It worked well for us, because at that time you could only tax deduct student loans for five years. Would something like that happen again? It all depends on where you move to! All I know is that if you buy smart, equity is a very nice thing!

 

[mhawk4]

Curious what your major is - $100,000 is a lot of debt unless you are going to be making a great salary! I get nervous when I see my kids' college aged friends taking on over $100,000 in college debt when they are Psychology, Criminal Justice majors etc. Plus you will be getting married sooner or later and taking on debt for a house, cars etc.

I work at a college and it is so scary how much college cost just for an undergraduate degree.

We do have cc debt, but plan to get it all paid off in the next two years. It makes me nervous to have debt. We hope to get the car loan paid off in 3 years.

 

[Donaldswife]

If you can swing it, buy a house as quickly as you can. Housing prices are still pretty low, but will move back up again. When that happens, you will be able to refinance and roll your student loans into your mortgage. That's what we did! We bought our house two years after graduating before the "bubble". Within 3 years, the housing prices started going up, and interest rates started coming down. We refinanced and rolled all of our student loans into the mortgage. It worked well for us, because at that time you could only tax deduct student loans for five years. Would something like that happen again? It all depends on where you move to! All I know is that if you buy smart, equity is a very nice thing!

I would have to respectfully disagree with this logic, I don't believe in using your homes equity to pay off anything else. You just don't know when the housing prices will drop again (especially give the recent volatility of the housing market) and you could end up upside down in your home. I'm not saying that would happen to everyone, or that someone who is very savvy about these things couldn't gain from it, but it is a risky thing to do. If you DO do something like this, I say proceed with EXTREME caution!

 

[niccikatie]

I would have to respectfully disagree with this logic, I don't believe in using your homes equity to pay off anything else. You just don't know when the housing prices will drop again (especially give the recent volatility of the housing market) and you could end up upside down in your home. I'm not saying that would happen to everyone, or that someone who is very savvy about these things couldn't gain from it, but it is a risky thing to do. If you DO do something like this, I say proceed with EXTREME caution!

I agree with this. Putting an unsecured loan (student loans) into a secured loan (your mortgage) is rarely a sound financial move. Only your credit will suffer if you are unable to pay on your student loans, but you could lose your house if you're unable to pay your mortgage.

 

[Robinrs]

I don't have student loans because I went to CUNY when it was tuition free back in the 70s. My Mom thanked me for that for years!

I now only have my one car and my house but I have a junior in high school so I'm about to go face first into the debt I avoided in my 70s!

 

[Virgderon]

I agree with this. Putting an unsecured loan (student loans) into a secured loan (your mortgage) is rarely a sound financial move. Only your credit will suffer if you are unable to pay on your student loans, but you could lose your house if you're unable to pay your mortgage.

Agree, except that student loans, unlike other forms of debt, are not dischargable during bankruptcy. This means that even if you filed bankruptcy, you are still responsible for the loan payments, no matter what your circumstances.

You really can't run away from student loans forever. You can defer them, but not run away from them.

 

[Cynt]

I agree with this. Putting an unsecured loan (student loans) into a secured loan (your mortgage) is rarely a sound financial move. Only your credit will suffer if you are unable to pay on your student loans, but you could lose your house if you're unable to pay your mortgage.

I third this notion. Plus the student loan people are very lenient if you need to defer payment for a period of time due to unemployment, financial hardship, etc while your mortgage company will want to get PAID!!

I have $2K student loan, $4k cc ($2300 car repair but I didn't want a car note so I bit the bullet and charged it. It's a honda accord w/ $200K miles. my rebuilt transmission will last another $100K. At the time the best decision for me.), $2k personal loan and mortgage. In 9 months I hope to have only my mortgage remaining.

Like others have mentioned live within your means. Distinguish a want and a need. Pay yourself even if it's only $20/check. And save something every paycheck. I didn't understand the saving until it was too late. Even if it's only $25/check. Build up until you're able to save 25% of your check. I wish I would have known this 20 years ago. Now I try and tithe 10%, save 25%, pay my bills and pay myself.

 

[niccikatie]

Agree, except that student loans, unlike other forms of debt, are not dischargable during bankruptcy. This means that even if you filed bankruptcy, you are still responsible for the loan payments, no matter what your circumstances.

You really can't run away from student loans forever. You can defer them, but not run away from them.

That is not an exception to what I said. Who cares about your credit if you've lost your house? Your credit is STILL trashed and you don't have a house. You've only trashed your credit if you've declared bankruptcy and still have your student loans.

 

[Virgderon]

That is not an exception to what I said. Who cares about your credit if you've lost your house? Your credit is STILL trashed and you don't have a house. You've only trashed your credit if you've declared bankruptcy and still have your student loans.

I agree that you should not rollover your student loan into your house. And "only trashed your credit" will bring you pain and heartache. I should know. I did.

You don''t have to own a home. You can rent an apartment if you have declared bankruptcy, you are just going to have to come up with a bigger security deposit.

People view homes differently and with more emotion than any other investment. If we all viewed a home simpy as an investment, and decided to own one based on whether it is a good investment, there would be a lot less people owning homes.

Especially now. The market may not have hit bottom yet.

Would you like to pay off a home and then find out that you can't sell it for what you paid for it? You are losing money, just like you are losing money on other investments.

 

[JaymeC]

That is not an exception to what I said. Who cares about your credit if you've lost your house? Your credit is STILL trashed and you don't have a house. You've only trashed your credit if you've declared bankruptcy and still have your student loans.

The catch with student loans.. is that like the other poster say. They NEVER go away. Ever. I would rather lose my house and have the student loans go with it honestly than drown in student loans for the rest of my life (You won't get them taken away in a bankruptcy. Ever.) I believe the only way to get rid of student loan debt is to go on permanent disability.

To answer the OP, we don't have any debt at all. Of course we rent, I'd prefer to have a modest mortgage But we'll hopefully be buying soon now that my husband is leaving the military and we'll be staying put for a bit longer.

 

[Minnesota!]

We have one small credit card and then student loans. Which are big. But deferred right now. I still make a payment on the interest accruing each month.

However, we will be buying the house we have been renting for the last 2 years in a few months..so I will be taking on a mortgage payment, too!

 

[Virgderon]

Forgot to add- people take on student loans when they are at the worst age to make such a life changing decision. No 18 or 19 year old can buy a $100,000 car, but they can get student loans in that amount.

Most college students who take a $100,000 loan to finance a history degree or a degree in music or art (apologies to those who have that degree, but I hire people for a living, and you can't make any money with those degrees) have no idea how they have just changed their life, and not in a good way.

 

[PatriciaH]

We have no debt. We paid off a bunch (truck, school, credit cards) when we first met about 16 years ago and then again the past few years due to never finding steady/good work in FL. We are back in MA now with a great job and no debt. We rent a great house with great landlords and a huge yard-about an acre. Love our town. I am not really interested in owning a home ever again unless we win the Powerball or something. We love renting so much more than owning! It is great to have no cc bills, no school loans, no car payment and no mortgage. Our car is a 2002 that just reached 80,000 miles so we will need a newer one in the next few years.

 

[Princess_Pris85]

Forgot to add- people take on student loans when they are at the worst age to make such a life changing decision. No 18 or 19 year old can buy a $100,000 car, but they can get student loans in that amount.

Most college students who take a $100,000 loan to finance a history degree or a degree in music or art (apologies to those who have that degree, but I hire people for a living, and you can't make any money with those degrees) have no idea how they have just changed their life, and not in a good way.

I completely agree with this statement.

 

[kirstenb1]

We have our mortgage and a small home equity loan. We're temporarily without car payments, but dh's car is 12 years old, so I expect any day now, we'll be back in them.

 

[stout]

Nearly 7 years removed . . . one word of advice . . . marry a doctor and have a tiny mortgage. Worked for me!
In all honesty, though, the legal market is horrible right now. Start networking, networking, networking. If you live in the midwest or are interested in working here, PM me.

 

[ssawka]

I would have to respectfully disagree with this logic, I don't believe in using your homes equity to pay off anything else. You just don't know when the housing prices will drop again (especially give the recent volatility of the housing market) and you could end up upside down in your home. I'm not saying that would happen to everyone, or that someone who is very savvy about these things couldn't gain from it, but it is a risky thing to do. If you DO do something like this, I say proceed with EXTREME caution!

ITA, that's why I said that it depends on where you are moving to.

 

[Spacepest]

Home mortgage. That's it!

We have two paid off cars and one income generating business.

No student loans because husband and I didn't graduate from college.

We've considered going to college to get one of those fancy degrees that everyone insists we must have, but then we realized we wouldn't be able to pay off our house early if we had to pay tuition. (That, and neither of us know what we want to major in anyways).

Thank gawd running a plumbing and home repair business doesn't require a degree.

 

[Sagginit]

student loans only here. i had it fairly rough and did not get a full time job until i was out of college for two years. it did lead me to my current position but the burden of the debt while hoping you land that great paying job is discouraging. i had around 40K in loans when i left, i now have it down to under 30K. this is the thing, the interest is where they get you, because you end up paying so much towards it. i left right before the recession and my interest rates were at 15% for the private loans which meant i was paying nothing towards the principle for a while. thankfully they dropped and im now able to actually pay off the principal.

you need a cushion no matter what, put a certain amount in an ER fund before you pay extra. once you have that extra its worth it to try to find extra to go towards it. im about to send in my second lump sum this year and it might be my last for a while since i need to relocate. however, i calculated just that alone will save me thousands in interest.

i suggest reading 'on my own two feet' if you have not already. some of the easiest to understand financial advice i ever got. also i bought a used car and have no car payment. that also has saved me thousands which helped me survive on such a low paying job. if you get a decent paying job thats more towards loans.