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Why student loans are better than
credit cards
Why student loans are better than credit cards
You need some more money for college expenses this semester. Do you whip
out a credit card to pay for your books, or do you apply for a federal
or private loan? Well, consider the options –
-With a federal loan, your interest rate will be low (around 5%) and
your payments will be deferred until 6-9 months after graduation.
-With a private loan, the interest rate will be slightly higher than
with a federal loan but will still be lower than average. In addition,
you will only need to make interest payments until after graduation.
-With a credit card, on the other hand, the interest rate can be as high
as 21%. Interest begins accruing almost immediately, and you need to
begin paying off the bill the next month.
This is not to say that credit cards do not have a place in your college
life. It is good to have one national card (Visa, MasterCard, Discover)
on hand to help you build a positive credit history and to provide
security in emergencies. When you decide to apply for a card, compare
annual fees, interest rates, and introductory offers. And to keep
yourself out of debt, try to—
-Pay your balance each month to avoid interest charges
-Pay your bill on time to avoid late charges
-Avoid cash advances, which come with large finance charges and interest
that begins accruing immediately.
This article is distributed by NextStudent. At NextStudent, we believe
that getting an education is the best investment you can make, and we're
dedicated to helping you pursue your education dreams by making college
funding as easy as possible. We invite you to learn more on how Student
loans are better than credit cards at http://www.NextStudent.com .
This
article is also distributed by
www.bestcreditcardsonline.com,
which has been offering credit cards services since 2002. To find
out more visit
www.bestcreditcardsonline.com.
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