Three Easy Ways To Get Your Finances In Order On This Labor Day
LAB Day is the perfect day to take some time to get your finances under control.
The federal holiday can be seen as the unofficial end of summer, with many traders dropping prices.
If you’ve spent too much over the course of 2021, you are not alone.
In fact, household debt rose $ 313 billion in the second quarter, according to data released by the Federal Reserve Bank of New York in August.
In dollars, this was the fastest growth since the second quarter of 2007 and the fastest percentage increase in 7.5 years at 2.1%.
As summer comes to an end and we head towards winter, we’ll explain simple ways to get your finances in order for the rest of 2021.
Pay off or reduce credit card debt
If you’ve spilled the money recently, make sure you have a handle on your credit card debt.
These loans often come with high interest rates, which means you are paying much more than you originally borrowed.
If you can, you’ll pay out more than the minimum each month.
However, this is not always possible and if you are struggling you can try taking out a debt consolidation loan.
This is the case when multiple debts are rolled over together into a new single loan and you may be offered a lower monthly payment or a better interest rate.
This will help you pay off your debt much faster and you only owe one large payment.
The Sun recently spoke to a couple who had paid off $ 78,000 in debt in two years through no-spend challenges.
Switch to a cheaper mortgage rate
Mortgage rates are still very low, so if you own a home it may be worth refinancing your mortgage.
This became even cheaper for many in August after the federal housing finance agency cut a 0.5% refinancing fee.
This resulted in a fee of $ 500 for every $ 100,000 refinanced, meaning that the average home price of $ 287,148 could cost almost an additional $ 1,436.
In June mortgage rates fell to their lowest level in four months, with average rates averaging 2.96%.
This was another drop from a year earlier, when rates dropped to 3.13% in 2020.
If you don’t have a good course yet or are committed to one, consider hooking up before they go up.
It might be worth doing as the Federal Reserve recently signaled a rate hike earlier than expected.
Before you refinance the mortgage, we have summarized four important steps you can take beforehand to save more money.
Refinancing of private student loans
Similar to mortgages, refinancing a personal student loan can help you lower your monthly payments.
This, in turn, could mean paying off the debt faster and saving money on interest over time.
Just be aware that by refinancing a federal student loan into a private loan, you will not be eligible for federal programs.
These include income-based repayment and Covid-19 support.
In August, the Biden administration extended the student loan facility to January 31, 2022. It was due to expire on September 30.
In the meantime, you have nothing to lose by refinancing a new home student loan at a lower interest rate.
When you refinance the loan, a private lender will pay it back and replace it with another with a new interest and repayment schedule.
Alternatively, you can combine several student loans into one.
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