5 Worst Strategies for Paying Off Your Student Loans
3. Paying off undergraduate loans while borrowing more for graduate school
You may feel good about paying down your undergraduate student loans while you’re getting your master’s degree or doctorate, but grad school loans carry a higher interest rate. It’s actually better to get a deferment on your undergraduate loans and put money toward your graduate tuition instead, Gobel says.
“Be thoughtful with grad school,” she says. “Put your money toward your graduate degree or better yet, look into getting a graduate assistantship to get your tuition reduced.”
If you’re working full time while pursuing a graduate degree, Gobel recommends asking your HR department for any tuition reimbursement programs they may offer.“You may be surprised what they offer. If your degree is going to improve your knowledge or job performance, they may offer a tuition stipend or reimbursement. Just check for any stipulations -- you may have to sign a contract that you will work there for several years once you get your degree.” Also see: What If You Have College Tuition and Nursing Home Bills to Pay?
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