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Ask the Experts – April 2020

Money is a topic that a lot of people don’t feel comfortable discussing. To many people, it’s rude, impolite, and offensive to discuss money. Other people only talk about financial matters with close family and friends, while people avoid discussing money because they’re not 100% confident and they don’t want to make a mistake.

Whatever the reason, the reality is that many people don’t discuss money. However, this means that they miss out on the opportunity to learn and develop stronger financial knowledge. When you discuss budgets and finances, and when you ask financial questions, you learn things you wouldn’t have otherwise known. This helps you make smarter decisions and improve your financial situation. That’s why, every month, our experts answer some of the money questions we receive.

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The questions here have been condensed or rewritten for clarity and simplicity.

I graduated from college eight months ago, but I still don’t have a full-time job in my field. I have quite a lot of student loan debt. How can I pay this off when I’m not working full time?

One of the toughest parts of being a recent graduate is paying back student loan debt. Post-secondary education continues to get more expensive every year, so more and more people end up taking out larger and larger loans to afford school. Unfortunately, not everyone gets their dream job as soon as school’s over.

The first thing you may want to do is look at your loans and understand them. Many people have loans from different sources. If you do, determine how much you owe on each loan, what interest rate you are paying, and when you are expected to make payments. This can help you create a plan.

It’s a good idea to focus on the loans that are costing the most each month. If you have credit card debt, for example, this could be more expensive to carry than a government student loan, so you will want to focus your efforts on the credit card debt.

While some student loans (such as federal government loans) have a ‘grace period’ that lasts for several months after you finish school, you can still make payments during this time. Interest accumulates even during a grace period, so it’s often a good idea to make payments even when you’re not expected to do so.

Since you’ve been out of school for eight months, your grace period may be over, but you should still look into it as different types of loans have different requirements.

When it comes to paying down the loans, you’ll need to make a budget and reduce spending in certain areas so that you can afford your student loan payments. Figure out what you can live without so you can reduce costs and put money toward your loans. It may be difficult to cut your spending, but it will pay off in the long run when you eliminate your debt.

My sister makes a lot of bad financial decisions and she has a lot of debt. What can I do to help her?

It’s hard when someone you love is in financial trouble. One of the most important things you can do in this situation is to not sound judgmental. While you may be disappointed with your sister’s actions, if you insult or offend her when you try to talk to her about finances, she likely won’t be willing to share with you.

A good way to bring the situation up is to talk about your own financial situation. For instance, you may want to mention that you can’t make a purchase right now because you’re saving up for a financial goal or trying to cut spending to pay off your credit card debt. This shows that you are willing to talk about your own financial situation and admit to your own mistakes. It also shows that there is hope for people who are struggling financially. This sort of moment can often lead to a discussion about finances and how to budget, which could be great information for your sister.

While you may want to help your sister financially, really think about it before you decide to take this step. Money can cause issues between people, especially if a loan isn’t repaid. If you do decide to give or lend money, make sure everything is laid out and clarified beforehand. For instance, if you expect to have the money paid back by a certain date, make sure this is clear.