Federal and private student loans are reported to the three major U.S. credit bureaus. Like any other debt, delinquencies and defaults will affect the credit history and credit scores of the borrower and the borrower's cosigner, if any. But, there are also several ways in which student loans affect credit scores differently than other types of debt.Read More
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With federal student loans, everyone pays the same interest rate, regardless of their credit scores. With private student loans, on the other hand, your credit score (and the credit score of your cosigner) has a major impact on what interest rate you ultimately pay. If you have excellent credit, you may even qualify for a lower interest rate that is competitive with the fixed interest rates on federal loans.Read more
The loss of the personal exemption in the tax cut legislation implicitly creates a new tax on college students. Although the Child Tax Credit was doubled to compensate for the loss of the personal exemption, the tax credit is available only for children under age 17. The new tax credit for other dependents does not fully compensate for the lost personal exemption for college students, since it is worth less than half as much.Read more
If you end up with a little extra money in your bank account — from a tax refund, a bonus, or from living below your means — you may wonder what you should do with this cash. Should you put it toward your student loan or invest it?Read more
Both 529 college savings plans and Roth IRAs can be used to save for college. However, a 529 plan offers several advantages when the student enrolls in college and a Roth IRA is better when the student decides to not go to college.Read more
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