student loan balance
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Credit agencies want to see student loan debts
Credit rating agency Equifax is asking the UK government for access to student loan balances to find out exactly how much graduates owe, according to a newspaper report.
Equifax spokesman Neil Munroe told the Daily Mail newspaper that giving lenders a credit history "would avoid putting further strain on graduates' finances by helping them make responsible lending decisions."
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More student loan balance info
In this case, paying for education is bad investment
Q: My son, who is 24 years old, recently inherited $50,000 from his grandfather. He is still in graduate school, but he is thinking about using the inheritance to pay off his $40,000 student loan balance, which has an average interest rate of about 5 percent. Is this wise?
A: It probably is a bad idea.
If your son invests the money in the stock market, he is likely to enjoy average annual returns greater than the 5 percent he would be saving by liquidating his loans. What's more, under certain circumstances the interest paid on the loans is tax deductible. (For details, see Internal Revenue Service Publication 970, Tax Benefits for Education.)
Because he is young, your son is well situated to invest in stocks for the long haul, without having to worry about short-term market volatility.