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DATE KILLERS: Student Loans, Credit Cards, Payday Loans – SERIOUSLY?

Three out of four single Americans agree anyone with more than $50K in student loan debt should move on. Only credit card and predatory loan debt were considered more intolerable. The long-term effect on a possible relationship with someone struggling with student loans is significant. Besides who is gonna pick up the tab for a nice dinner with good wine. 

According to a recent survey by Finder.com for Ameritech Financial, a document preparation company, some debt was more acceptable than others to potential romantic partners. For example, real estate, auto and business loans were less likely to scare off prospective admirers. Interestingly, there was almost no difference between genders on this issue. Men and women, at just above and below 76%, respectively, stated that student loan debt was a non-negotiable obstacle to further amorous involvement.

Additionally, millennials, those who carry much of the student loan debt burden, were the most intolerant of student loan debt in their significant other. Over 80% found student loan debt to be unacceptable, the highest of all categories in all generations.

Though the survey does not seek to uncover causes for these responses, it is certain that millennials have the most exposure to watching their peers struggle with student loan debt and are well-informed as to the many poor financial outcomes associated with student loan debt, such as delaying home buying, getting married, having children and saving for retirement. The monthly drain on cash also determines how much money can be spent going to the movies, concerts, dining, drinking and other recreational activities.

A recent Harris Poll of current and recent college students conducted online for Ally Bank, found that many students are using their college years to develop good personal finance habits and have the right idea about saving for the future. The survey showed almost 9 in 10 have/had a budget while in college and more than a third are/were “die hard budgeters,” sticking to that budget as best they could.

Ally Bank Offered These Tips:

• Make a budget and stick to it: Determine how much is needed for typical expenses such as transportation, utilities, meals and entertainment. For a generation that has grown up with smartphones, one way they can make budgeting easier is to use technology at their fingertips by setting up account alerts and reminders to pay bills on time.

• Managing overall spending: The survey also found that the biggest financial surprise the majority (57 percent) of current and recent college students experienced while in college was just how much things cost. One way to manage those costs is to forego signing up for the plan with the most features – be it a cell phone, dining hall, cable, etc. Figure out what is really needed versus wanted then select the appropriate plan.

• It’s never too early to start saving: Three-quarters (75 percent) of current and recent college students said saving for the future should start before or during their college years. A majority (54 percent) said that saving should start before college and another 21 percent said saving should start while in college. Talwar recommends seeking out savings accounts free from minimum deposit requirements and monthly maintenance fees that deliver competitive interest rates. Putting money aside on a regular basis can grow in time thanks to compound interest.

• Plan (and save) for the unexpected: More than a third (35 percent) of current and recent college students said one of the biggest financial surprises they experienced while in college was having to pay for unexpected bills. It is important to stash some cash in a savings account to cover unpredictable costs to prevent from having to use a credit card and risk building up potential debt. Consider the convenience of online banks, which tend to offer better savings rates.

• Find deals with a little work and imagination:  Before buying anything or heading out to eat, check out sites like Groupon or Ebates. Also, don’t just trash those unused gift cards. Some can be cashed in online. Plus, students also may find that a variety of off- and on-campus restaurants and other retailers offer a college ID discount.

• Start now to establish good credit: If a credit card is needed, think about getting one with no annual fees and flexible rewards. Using a card for classroom expenses then paying off the balance monthly can be a good way to manage expenses but also establish good credit for the future. According to the survey, college students are getting a head start on this as well. More than 7 in 10 current or recent college students (72 percent) indicated they had a credit card while in college and 69 percent of those with a card paid off the balance every billing cycle.

Ameritech Financial Survey

Ally Bank Tools

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