Have you elected additional Life Insurance through your company’s employee benefits?  Many people sign up for coverage because it is easy to acquire since there is slim to no underwriting requirement and have relatively low premiums.  While young, this approach can work if you like the idea of extra insurance on the cheap.  However, at age 45 (if not sooner) the cost usually becomes more costly than private coverage and will increase at quinquennial ages (45, 50, 55 etc).  Employer coverage is also non-portable or expensive to do so.  It should not be counted towards your actual life insurance needs for these reasons.

If you have coverage through work, are near or over age 45 and have insurance needs for a certain time & amount, a term policy likely will save you premium dollars, have a locked in rate, and will not be affected by any employment changes.

Please contact us if this pertains to you and would like to research other options.

Over the past 20 years, the annual cost of a college education has risen by 130 percent, according to the College Board.  With that said, Americans have racked up around $1 trillion in education debt from both federal and private student and parent loans.  Preparing for repayment of school loans may not take immediate priority for newly graduated students – but it should.  If you are on a tight budget, it may be difficult to steer available cash towards paying down your education debt.  It is important for you to do your best to pay off loans as early as possible, otherwise it may stick around for a decade or more and potently prevent you from saving enough for retirement.

Here are few steps you should take when tackling your student loans:

1.)  Face your Debt:

– A crucial first step is to know what you’re working with.  On the National Student Loan Data System, students/graduates can locate how much they owe including the already accumulated interest.

 

2.) Contact your loan servicer:

– Once you receive the amount you owe, you should find out exactly who you will be paying (your loan servicer).  Your loan servicer is your first point of contact for any questions & updates you may need.

 

3.) Pick a repayment plan:

– There are several different payment plans out there that could work for you.  There are the standard 10 year student loans.  Some borrowers of the federal student loans have the option of “Income-Based Repayment” or “Income-Contingent Repayment,” that adjusts your monthly bills according to your pay.

 

4.) Create & Stick to a Budget:

– When you can determine a monthly obligation to your loan servicer, you must keep track of other spending to ensure you can cover all your bills (without stress).  A popular website, which we recommend using, that helps keep track and create a functional budget is mint.com.

 

5.) Focus on the Future:

– Many find themselves sacrificing a lot to make their monthly student loan payment.  It may seem like a lot, but 10 and 15 years down the line when you’re able to contribute more and more to your retirement plan and your children’s educational plan, you will be grateful you successfully paid off your student loans that helped you receive the education and career you have today.