How Do I Get Out Of Paying My Student Loans

How Do I Get Out Of Paying My Student Loans – A common financial tip is to “pay off your home loan as soon as possible”. While this may apply in other countries, Singaporeans should think twice – rushing to pay off your flat may not be worth the risk of much interest. Why it might be a bad idea:

The main reason many people want to pay off their home is psychological: knowing that your home — a large debt — is paid off gives you peace of mind. But what if we told you that peace of mind is easily disturbed and then turns into a long dream?

How Do I Get Out Of Paying My Student Loans

Every once in a while, we meet Singaporeans with fully paid flats, those processing coffee powder who are so broke. How is that possible? Let’s explain:

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Say you owe $160,000 on your HDB loan. After years of saving, you’ve managed to accumulate $100,000 – either in cash or in your CPF.

Then you say “Finish your debt! Pay off your home loan ASAP!”

Then you take the $100,000 and put it all towards paying off your HDB loan. Congratulations, you now only have $60,000.

For a few weeks, you’re in trouble. Maybe you lost your job or a loved one needs expensive surgery. See how you feel when this happens:

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You have $0 to solve the problem because your $100,000 is already invested in your HDB loan. It’s true that you only owe $60,000 on your mortgage, but what’s the point? It won’t help you pay the bills.

You are in a hurry. If you lose your job and can’t pay your mortgage, you’ll lose your home even though you owe “only $60,000.”

If you have $100,000 in savings, you can still take out a loan.

, and there is plenty of time to find another source of income. At the very least, make sure you get the best price you can, so you can take your time shopping around and discounting.

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So before you rush into paying off your debt, decide whether you’re ready to face the problem or not. If you are determined to pay off your mortgage early, make sure you set aside six months worth of savings.

The answer is If they make a mistake and pay early, they can use financing (a home equity loan) to fix up their home. But these aren’t cheap or fast, and don’t expect them to be available all the time.

If you’re looking to cash out of your home this way, talk to one of our loan experts at iCompareLoan.com. We will find you the best loan deals at all local banks.

Instead of sinking more money into early payments, consider investing in a retirement fund. This is better than keeping all your money in a flat and treating the flat as a retirement fund.

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If you have proper financial planning, you can build a healthy retirement income while paying off your home before age 62. For example:

Let’s say you take out a loan of $315,000 for an HDB property. With an interest rate of 2.6 percent per annum (HDB mortgage loan), you will pay $1,261 per month for 30 years. Let us also assume that you are 35 years old when you take the loan.

If you put $500 a month to pay off your home loan faster (so you pay $1,571 a month) you will pay off your HDB house in 22 years, less than 30 years.

By the time you turn 57, your mortgage will be paid off. However, you don’t have retirement savings because everything went well. Suppose you are 65 and continue to work for eight years

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But, let’s say you put $500 a month into a good retirement plan; A combination of unit trusts, ETFs, endowment policies and more over a 30-year period, we’ll assume you’ll get four percent annual returns — as most financial planners can tell you, which is doable for the average investor. .

After 30 years of saving, this retirement fund will grow to $349,000. And if you pay your HDB loan diligently, your flat will be paid off by the time you turn 65. So there you have it.

If you have high-interest debt, such as credit card debt or personal loans, you are making the mistake of rushing to pay off your home loan.

The average interest rate for home loans from banks is two per cent per annum, while HDB loans are discounted at 2.6 per cent per annum. These are peanuts compared to personal loans or credit card loans.

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Most personal loans will increase by six to nine percent. Credit card loans lead to exorbitant rates of 24 to 26% annually.

On top of that, if you’re doing it with your CPF, consider a home loan necessary anyway. The CPF OA rate is 3.5 percent per annum, which is enough to repay HDB loans and most bank loans.

On the other hand, it does nothing to help your credit card and loan balances, which snowball every month.

Debts you have paid off during your lifetime. Otherwise, you may end up making payments while selling your apartment to pay off other debt.

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You often hear the argument that the sooner you pay off your home loan, the less interest you pay. If you use a private bank loan, this is not possible.

Banks will not waive interest due to you because you choose to pay off your loan early. At most, you can expect to pay 1.5 percent of the outstanding loan (but it can be double this amount).

So before you try to pay off your home loan, make sure the penalty is worth it (hint: it probably isn’t). If you’re not sure, contact your lender for a free consultation.

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To use Good Social you must consent to the collection and use of your information on this site. %secret_police% 2010 was a good year; After college, I got my first “big boy” job at an accounting firm and life seemed promising.

I wanted to choose myself over debt. I know intuitively $30k in debt is a ton.

Instead of me making the decisions, the debt made the decisions for me. I couldn’t take a non-profit (low paying) job and I couldn’t start my own business because I had debts to pay.

It’s easy to say c’est la vie to a job you can’t afford when you don’t have to worry about paying the bills.

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You are clearly smarter than me. It took me years to realize that debt was stunting my growth.

I didn’t know I had a problem until it hit me in the face – suddenly. Okay, let’s get down to business.

To face the Goliath of clothes, I needed a plan. Worked, measured and strong. I wanted to go too.

My first goal was to pay off my debt in 12 months, 1 year, and when I reached this goal, not only did I have wonderful faces, smiles and laughs, but I told myself that I set myself very high.

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This is normal. When you try to achieve a big and ambitious goal, people try to destroy your dreams.

People portray your worldview. If they don’t think it’s possible for them personally, they’ll tell you that neither can you.

Because of my goal setting power, I surpassed my goal by 2 months. In August 2011 I paid off my last student loan.

Trust me when I say, you can’t please everyone and your decisions will hurt someone in the process.

Paying My Dues To The Dirt

I’ve always been good at working my hips. As part of paying off my debt I realized I had to make some really big changes.

I know I can live on less than $25,000 a year. Heck, I know I could rent my house and live on $15,000 a year.

I lived for a while in true “college spirit”. Let me introduce you to my big shovels.

This was my job through college. I lived on commission income for 4 years and I know I can survive.

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I worked from 4 pm to 8 pm. Tuesdays and Thursdays, Fridays 11:00-8:00, and 9:00-6:00 p.m. On Saturday. 26 hours a

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