Should You Still Heed Your Parents’ Money-Related Advice? They May Be Wrong in Some Aspects!
Is it really worth it to follow a piece of advice that’s been effective in the past? This is far from being a love article but is as essential, too. For most of us struggling to find what we really want, we would always confide with our parents, asking them what they think is the best step we could make. Then, we would often hear from them to finish college, to secure a high-paying job, and to buy a house – after all, they are now successful, right?
Not the Same Case
However, does the same formula applies to you, too? Take a look at the case of Lisa Weeks, who carefully followed her parents’ path but didn’t end up with what she expected to be. She secured a student loan of $165,000 to enter the University of Rochester and to study law at Syracuse University. Don’t get her wrong, she is now an attorney at 32 in Seattle. Despite this, she still has to pay $140,000 from her loan.
Burden of the Student Loan
We have always been told that a student loan is a good kind of debt because it is for our future. However, statistics would show that fresh graduates and young professionals find themselves deep into the hole and therefore, this adds to the monthly problems one faces. According to the New York Federal Reserve, the educational debt ballooned to $1.48 trillion since 2005, a sudden increase faster than other types of credit.
It should be underlined that investing in yourself is paramount, BUT, along with prioritizing your career path, you should definitely find a way to visualize your repayment strategy. Just think about this, over 2 million have already defaulted on their loans in the past six years.
Plus, not to underestimate anyone but taking out credit is not an assurance you will finish schooling — in one-third of American colleges, less than 50 percent actually get a credential within eight years.
Plus, have you ever wondered if the degree you got could land you your dream job? A Federal Reserve study also said that four of 10 graduates are stuck in work that doesn’t even need a degree. Meanwhile. if you are eyeing grad school, you need to make sure that you will be earning more than what you’re paying for in your student debt.
The pressure of Buying a House
Surely you’ve dreamed of owning a house, something you can call your own. Most people think that it is a good investment but financial planner Sarah Behr begs to differ. This is especially true if you’re unsure whether you can offset the money you used in how many years. If you are planning to secure a housing loan, analyze if you have the money to shell out for down payment. An abode is not like a cell phone you can buy in an instance, which means you need a big sum as an initial payment.
Then, evaluate if you can afford to pay the monthly mortgage. Will you still have something left from your salary? How long will you be staying at this house?
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