Graduated Learning: Life after College

I got my degree, I got a job…now what?

Goodbye, Sallie Mae! May 5, 2012

Well, I just clicked a button on the Sallie Mae accounts page that should have my federal student loans PAID OFF IN FULL!

It feels really awesome.

The loan started out as a bunch of federal student loans that I consolidated back in 2006 (after I graduated).  So they were serviced by the same bank that my private student loans were at.  At some point last year, Sallie Mae stepped in and took over as the company in charge of my loans. The Sallie Mae accounts page made me want to pay off my debt even faster, since they showed the daily accrued interest.  I was getting sick of it!

So today, I paid them off.  I’m no longer paying 3.5% interest on any debt.  Woo!

Of course, I still have about $29k in private student loans (thanks for being so expensive, MIT!), but they’re at a pretty sweet rate of 2.75%.  But I’m still coming after those!  And that’s much better than what I graduated with:  more like $70k at 8.5%.  But I’ve been aggressively paying that down, too!  Luckily, that loan’s rate was pegged to the Fed Rate, and (unluckily for those of us with savings accounts) the Fed rate has dropped like crazy since I graduated.  Plus I enrolled in all the programs that the bank had to offer that would lower my rate.

I am thankful that my rates are so low.  I know a lot of people aren’t as lucky.

But the final message for today:

My federal student loans are GONE!

 

[Edit 5/7/12:  Just looked back on my private student loans.  Turns out I only started with $57k at graduation.  And so far I’ve paid $49k in principal and interest, but I still owe ~$29k.  It’s mildly frustrating realizing I’ve already paid at least $13k in interest on my private loans (according to the loan company).  No, not mildly frustrating.  Gut-wrenchingly disgusting.  Oh well.  NEVER AGAIN!  (until I buy a house)]

 

The good kind of impulse spending? February 23, 2009

Filed under: Personal Finance — Stephanie @ 10:55 pm
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I just set up two extra payments towards my student loans.  One to my ~$15k  at 4.5% loan, and one to my ~$44k at 4% loan.  And it was kind of on a whim.  I was visiting my mint page (as I do, perhaps too often) and saw the reminder to pay my student loan bill.  And technically, I don’t have to schedule payments, as I’ve signed up for their automatic bill pay setup (which I believe gives me a .25% interest rate deduction).  But I can still manually set up payments.

Why did I do this?  I think it was due in part to realizing that my savings account at ING is making pretty crummy interest(1.835% (1.85% APY)), compared to back in the heyday (only a few years ago!), though I will admit it’s still much better than the tiny rate I used to get at my brick and mortar bank.  And so my money is going to do a lot more for me (net-worth speaking) paying down my student loans than it would be sitting in savings.  And I actually didn’t move any money out of my savings account, I just took some out of my checking to pay these extra payments.  So I’m not saving any less.

So, while I feel a bit anxious about the fact that I’ve reduced my liquid assets by ~$1k, in the long term, my net worth will thank me.

In the meantime, I’m also wondering if I should start “shopping around” for better savings account interest rates (or signing up for a CD ladder, which I’m still not very familiar with).  I have heard good things about Emigrant Direct, but I’m not sure how much of an impact a slightly higher rate will have on my savings.  What are you doing to counteract this crumbling economy of ours?

 

Dear Fed, October 9, 2008

Filed under: Personal Finance — Stephanie @ 11:06 pm
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Couldn’t you have done this a week ago?

We all know that the economy is crumbling in front of our eyes.  And after that bailout bill and all these other attempts to fix the economy, the Fed and other countries are trying the old interest rate reduction trick again.  You are probably sick of me talking about this every time it happens.  As you may have noticed, we’ve got ING savings interest rates down to 2.75%, and checking interest rates down to 1.5%.  They’ve gotten on that pretty quickly!

But really, my issue with it being this week instead of last week (if it had to happen at all) is that my variable student loan interest rates are readjusted every quarter.  So, October 1st was the first day of the fourth quarter…which means I’m stuck with the same rate for my loans, but lower rates for my savings.  Yes, I complain about these things every time.  And I know that there are a lot of people worse off.  I’m just laying things out there.

That’s really all I’ve got for now.  I’ve been trying to follow a lot of what’s been going on in the financial world, but to be honest, it’s a bit depressing.  Though it’s odd when you think about how so many people are now finally thinking about living within their means and avoiding going into further debt.  Hooray living within your means!

 

My student loan rates dropped again! July 5, 2008

Filed under: Personal Finance — Stephanie @ 2:32 pm
Tags: , , , ,

I mentioned before that my student loan rates had dropped a few times.  Well, it’s happened again!  I was actually looking forward to July 1st.  Yeah, I know, so lame.  But yep, my variable rate is down to 5%!  So that’s pretty excellent.  It went from 8.25% to 7.5% to 6%, and now to 5%.

Now something I’m not quite certain of is if I could consolidate my loans at this rate.  I’d assume that the Fed rates don’t have too much distance to go (it’s at 2% right now, so really, it can only drop down 2 points, right?), and so it would be pretty low.  I just don’t know for certain how to go about it.  I consolidated my Federal student loans after graduation, but I just left my private loans as they were.  Have any of you done this?  I guess I could just call the company that my loans are with and ask them how it works, but I think I’ll at least hold off until after this weekend.

Happy Fourth of July!

 

Looking at the positive of the recession April 11, 2008

The Feds keep lowering rates, which is unfortunate for my savings account, but great for my student loans.  As I’ve mentioned in the past, ING, as well as most other banks that offer “high yield” savings accounts are staying close to the Federal Fund Rates, which is currently 2.25%.  And so my account has suffered a little, but I haven’t taken any money out of my “emergency fund”, except to fully fund my Roth IRA for 2007.  Since I had started the Roth IRA halfway through the year, I didn’t put enough in to cover the $4,000 max for last year.

Anyway, I just wanted to remind you to check your rates that depend on the Federal rate.  Some rates are fixed (for me that means my consolidated student loans stay at 4.5%), but other rates depend on the Federal rate.  While I don’t worry about credit card rates (I pay off my balance every month), some credit card rates are based on the Fed rate plus some constant extra percent above that.  The one rate that I’m excited about is my student loan rates.  I owe a large chunk of money for student loans that follows the Fed Rates…and every quarter, they readjust their interest rates accordingly (I’ve heard many companies do this).  So while ING and other banks follow the Fed rate very closely, these rates go at a slower pace.  So, currently, those loans are only at 6%!  Which still is a lot, but it’s a lot better than the 8.5% it was a year ago.

Oh, and Trent at The Simple Dollar wrote an article about the recession and what’s going on…it’s pretty good, you should check it out!

 

ING Lowers their rates…again! January 23, 2008

I can’t say that I wasn’t surprised. After the Fed lowered the interest rates 3/4 of a point, I knew my rates would shrink. Their checking account is down to 2.50% APY for up to for accounts with less than $5,000, and their savings account is down to 3.65% APY. This makes me all the more interested in paying off my student loans. I mentioned before that the interest rate for the bulk of my student loans had dropped, thanks to the Fed lowering rates last year. Sadly, I’ll be waiting a few more months before my loan rates are lowered (if the Fed rates don’t rise). In the meantime, paying off loans that are more than my yearly gross income (Darn you MIT!), most of which have an interest rate of 7.5% is going to net me more money than saving money at about half that rate. I already have a decent emergency fund, so I feel that I can draw some money from that and put a decent chunk towards the student loans. I do know that there are tax factors relating to the two options…I think that I’ll have to still pay taxes on the money I earn on interest through ING, but I also get some sort of tax benefit for the interest I pay on my student loans. I think for the whole “pay yourself first” idea, I’ll continue to put some money away every month, but I’ll draw some money from the “emergency fund” to pay a large amount towards my loans.

Though ING has lowered their rates, I’d still urge you to join up with them…for the referral bonus (that both you and I would get!). A guaranteed 10% return ($25 for $250) isn’t half bad, right? If you need a referral for either the electric orange checking account or the savings account, let me know (leave a comment; there’s a place to enter your email address, and only I can see it), or email me! Wow, this seems a bit forward and brazen to just tell you to do this (since I get a nice $10 referral bonus when you sign up and put at least $250 in). I’ve never really been a rate chaser when it comes to savings accounts…if you are, I don’t know if ING is right for you. The rates could change again!

Something I read about the Fed interest rate decrease is that they hope that by lowering the rates, consumers will be more willing to spend (rather than save). I guess that’s happening in a way for me…I’m spending the money on student loan payments instead of saving it in a savings account. But that made me wonder: are all these people you read about in personal finance blogs (me included, I suppose) partially to blame? Everyone is urged to have an emergency fund, be more frugal, spend less…but the economy “needs” us to spend to keep it going. I know that there’s also all the people NOT saving, because they’re part of the whole “subprime market meltdown” that is being blamed. Who knows…That was just something I was thinking about…

(some interesting articles that I’ve found on Slate.com (an online news magazine) relating to the Fed rate decreases…the one listed above: Bernanke’s Surprise, as well as How will the latests interest-rate cut affect me?, and How do you inject money into the economy?.)