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Before You Defer Your Student Loans, Watch This - YouTube
Channel: The Rachel Cruze Show
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- Welcome to another episode of
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The Rachel Cruze Show at home edition.
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Thank you to Amelia Jane
and sweet little Caroline.
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They're just the best
little artists. So great.
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All right, so this video,
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we're gonna talk about your
deferred student loan payments.
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Yes, old Sallie Mae.
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You know, paying for that school degree
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hopefully you're using.
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But during this time,
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it was . . . Obviously, it's been insane
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with the pandemic and everything going on.
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A lot of industries
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were actually giving some
forbearance, or deferment,
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or even complete forgiveness
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when it came to people's debts
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and payments and bills.
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And so, a lot of you took advantage of that,
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and a lot of you started deferring
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your student loan payments.
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But let's break down what this is.
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Remember, when you defer payments
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that is not forgiveness.
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That is not saying,
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oh, I never have to
pay that payment again.
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Thanks, government.
You're just so generous.
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No, it means that you are
prolonging paying on your debt.
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And that was okay,
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that was an okay route to take
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if you lost your job,
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maybe you were furloughed
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and you just didn't have money
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to even put your head
above water financially.
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If you had to go that route,
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defer your payments for a month or two,
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again, that's totally fine.
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But if you keep going down that route,
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what happens is, you're going
to have to eventually pay that.
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So, those payments just tack onto the end.
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And then a lot of people
with student loans,
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they're like, well, it's zero
interest, which is great.
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So, like, I'm not really
technically paying on more,
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so I'm gonna go that route.
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But again, when that's your mindset,
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that means you're going to
be in debt for a long time.
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Debt is not about interest rates.
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It's not about math.
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It's about having the freedom
of not owing anyone anything.
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And when your income comes in,
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you're actually the one
that gets to control it,
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and you get to do whatever you
want to do with that income.
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It's not dictated by anyone else.
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And when you're in student loan debt,
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which is usually a lot of people's,
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their largest debt is what I'm finding,
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besides a mortgage.
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And man, it can seem like
this massive mountain.
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But remember, you're going
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to have to pay this off eventually.
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No one in office,
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no tooth fairy is gonna come down.
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Fairy. The tooth fairy.
Amelia's freaking out
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that she's gonna lose
her teeth any day now.
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That's the mom talking in me.
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Fairy. No student loan fairy coming in
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and is like I'm gonna
just wipe it all clean.
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It's probably not gonna happen, you guys.
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You're going to have to pay it.
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And again, if you are
deferring your payments,
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that means you are still
going to have to pay that.
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So, make a plan, attack debt
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and get your student
loans out of your life.
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Okay, so those of you out there
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that have a stable income,
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keep paying on your debts.
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Keep being gazelle intense,
is what we call it,
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paying it down, keep going.
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Now, if you have lost your job,
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then again, pause everything.
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Stay current if you can,
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if you can bring in any other income,
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or if you get unemployment,
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whatever you can to stay current.
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Or if you have to, again,
take that deferment
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or forbearance for a very,
very short period of time
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until you can replace your income.
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But stockpile cash.
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Don't pay extra on your debt
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because you're kind of in
crisis mode if that's you.
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You just want to make sure
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that your food, shelter,
utilities and transportation
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are taken care of during this time.
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And then, once you get your income stable,
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maybe you get your job back
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if your state reopens and
you still have your job,
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or you go get two part-time jobs,
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or you find a new completely different job
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with a different company maybe
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and you're making your income back,
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then take that money
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you had stockpiled during the crisis mode
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and throw it at the debt.
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So, the key here
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is to continue on the Baby Steps
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once your income is stable.
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And what I mean by stable
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is not this elusive fear
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of like, oh no, I might lose my job.
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And if you're in an industry
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that you know you will,
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then sure, you want to plan for that.
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But if you just have this elusive fear
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that the whole world's
gonna come to an end
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and you're gonna lose your job 100%,
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that's not the truth.
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That's not factual.
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So, focus on facts, remember that.
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And then continue on with the Baby Steps.
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And if you are unfamiliar
with the Baby Steps,
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this is a great time for you to sign up
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for Financial Peace University.
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We have a 14-day free trial for you,
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and it is amazing.
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It's gonna walk you through
exactly what you need to know,
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not just about the Baby Steps,
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but about your debt, about budgeting,
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about real estate, insurance,
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how to really change your future
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when it comes to your money.
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So, make sure to check that out
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at daveramsey.com/hope.
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