Student Loan Refund Money

**tkn4lif** · 02-02-2008, 08:12 AM

I received the refund amount on my student loan I have this semester. Its a little over 2K. Im am trying to decide what to do with it! Should I just put it all in savings or put half in savings the rest to pay down credit cards?

Help! Any advise would be greatly appreciated!

(My current debt is shown in my signature area)

**missyali** · 02-02-2008, 08:30 AM

I'd fund your EF and then put the rest towards the credit card you are currently focusing on with the snowball.

**McD** · 02-02-2008, 11:15 AM

I would put 300 into your e.f. to make it fully funded, pay off Kohl's, then take the remaining balance and pay towards your next debt.

**Jill B.** · 02-03-2008, 08:44 AM

I agree with Mrs.Macdowell. You have $18,000 in credit card debt and that $2000 would help to knock off about 10% and fund the EF. Any income tax money you get back should be put towards the debt, too.

**FrugalMomof3** · 02-03-2008, 11:34 AM

I also agree with Mrs. Macdowell

**Samigirl** · 02-03-2008, 04:37 PM

I agree with FrugalMomof3 and Jill....who agree with MrsMcDowell...ha.

**amykhar** · 02-03-2008, 04:40 PM

Technically, student loan money may only be legally used for school and living expenses. Is there a reason why you are borrowing more than you need for school? I did the same thing, and now I am buried in student loan debt.

**tkn4lif** · 02-04-2008, 07:36 AM

The only option I had was 3500 for spring semester. For some reason there was no spring/fall. So after taking 4 classes and paying for books I was left with 2100.

I know that eventually I'll have to pay it back, thats why I'm thinking of putting some away in savings.

**McD** · 02-04-2008, 08:42 AM

Originally Posted by tkn4lif

The only option I had was 3500 for spring semester. For some reason there was no spring/fall. So after taking 4 classes and paying for books I was left with 2100.

I know that eventually I'll have to pay it back, thats why I'm thinking of putting some away in savings.

Typically, student loan debt is considered to be 'good debt'. Usually, they are lower interest rates and the interest paid on them (at least a portion of it) is tax deductible. It would be smarter to take the student loan check and pay down debt. If you compare the a.p.y. of your savings account versus the a.p.r. of your credit card, you can see where you will be able to save more money in the long run by paying down the debt. You'll pay less in interest on the credit card and most savings accounts are paying much right now.

**tkn4lif** · 02-05-2008, 03:41 PM

So, this is how I applied it

200 - EF
500 - Home Depot
500 - Discover
300 - Bank of America
200 - Vacation Acct
200 - Kohls

I left the rest in checking because we were really low.