Mailbag: We have $146,000 in student loan debt, how do we pay it down?

In this Mailbag, Jean talks to Patti and Patrick about the substantial student loan debt they’ve incurred on behalf of their daughter. They explore various ways to pay it down, including using a home equity line of credit or tapping into retirement funds. Jean gives detailed guidance on the best approach to consolidate the debt. The episode also touches on the broader financial responsibilities parents face, and the importance of open communication with children about the realities of debt. 

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Takeaways:

• When dealing with multiple student loans, consider consolidating them to secure a lower interest rate. 
• Before tapping into retirement funds or other long-term savings to pay down student loans, consider the tax implications and potential penalties. 
• Home equity lines of credit can be a viable alternative for paying down student loans, but compare interest rates and terms.

Chapters:

00:00:00: Introduction

00:02:52: Details of Student Loan Debt

00:05:18: Interest Rates and Consolidation Options

00:07:52: Home Equity and Savings

00:13:38: Financial Planning and Parental Support

00:16:08: Next Steps

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