Posted on Monday September 16, 2019

A few concepts to help you manage your finances soundly as a student

School will be back in session soon, and you feel like you should sort out your budget to avoid unpleasant surprises. Good thinking! And that’s when your head starts overflowing with questions about financial products for students. We’ll answer three of them to help you manage your finances.

Q1: How do I manage my student line of credit to better cope with unexpected events?

A maxed-out student line of credit is useless as a safety net. You should view it as an emergency cushion, a source of funds you can access anytime to bridge the gap between upcoming income and immediate expenses. By keeping your line of credit at a low usage level, you’ll protect that precious cushion and improve your credit score over the long term. After all, one day, you may want to buy a house or a truck (though not right now!).

Q2: How should I pay down my credit card balance to avoid paying a fortune in interest?

Imagine going out to buy a car and being told it’ll be 15–20% more expensive if you take one year to pay for it. Not the most attractive proposition, is it? And yet, that’s what happens whenever you carry a balance on your credit card at the end of the month (depending on the interest rate). The best way to use a credit card is to pay it off in full every month. If you know in advance that you may not to be able to do that, try to use other forms of financing such as a student line of credit or a personal loan.

Q3: How do I choose between a student line of credit and a personal loan?

There are some key differences between a student line of credit and a personal loan. The personal loan involves a payment schedule that’s set ahead of time. You’ll need to apply again whenever you want to borrow an additional amount. As for the student line of credit, it offers a predetermined credit limit. If you want, you can repay just the interest until the end of your studies. Choosing the right student financial product for you means giving a lot of thought to what your needs and financial habits are!

At UNI Financial Cooperation, our approach is based on listening to you and achieving YOUR goals. You could have access to a line of credit of up to $275,000 depending on your field of study and financial situation. Make an appointment with your advisor today. Happy back-to-school season!