| We're conditioned to think all debt is bad, and for the | | | | your 6% student loans are an absolute bargain. |
| most part it is. Any money you owe someone else is | | | | Especially when you consider them what they really |
| less you have for building your own long-term wealth. | | | | are: an investment in your future. If you are stuck |
| However, there are cases where some debt isn't a | | | | owing both, pay the minimum on your student loans |
| bad thing, and some debt is definitely better than | | | | and close out the credit card debt as soon as |
| others. | | | | possible. |
| In this article we'll discuss three reasons why student | | | | 3. Federal loans offer repayment flexibility |
| loans aren't close to being bad debt and how they | | | | If you have an unplanned event occur (such as a job |
| can even be considered good debt to have. | | | | loss) and cannot pay your student loans, most |
| 1. Interest is tax-deductible | | | | lenders offer deferment plans that will stall your |
| On federal school loans you can claim interest you | | | | repayment for 6 months or a year. This will allow you |
| pay as tax deductions. Very few types of loans or | | | | to correct your financial situation and get things under |
| debt allow you to do this and it can save you | | | | control without defaulting on your loans. Student loan |
| hundreds, if not thousands, of dollars over the life of | | | | lenders understand things happen and they are |
| your loan. Credit card debt will not allow this and | | | | usually more than willing to work with you. Try |
| neither will car loans. You can usually claim interest on | | | | getting that kind of compassion from your credit |
| your mortgage,but that's about it. Pretty much all | | | | card company. |
| other debt will not get you any deductions on | | | | As good as those three reasons are, your monthly |
| interest. | | | | student loan payment would still be better off in your |
| 2. Low interest rates on consolidated loans | | | | personal retirement fund, so pay them quickly, just |
| Granted, it's still debt. And yes, you do have to pay it | | | | not at the expense of paying off other, high interest |
| off. But compared to credit cards at 20-25% interest | | | | debt. |