- Welcome to another episode of
The Rachel Cruze Show at home edition.
Thank you to Amelia Jane and sweet little Caroline.
They're just the best little artists. So great.
All right, so this video,
we're gonna talk about your deferred student loan payments.
Yes, old Sallie Mae.
You know, paying for that school degree
hopefully you're using.
But during this time,
it was . . . Obviously, it's been insane
with the pandemic and everything going on.
A lot of industries
were actually giving some forbearance, or deferment,
or even complete forgiveness
when it came to people's debts
and payments and bills.
And so, a lot of you took advantage of that,
and a lot of you started deferring
your student loan payments.
But let's break down what this is.
Remember, when you defer payments
that is not forgiveness.
That is not saying,
oh, I never have to pay that payment again.
Thanks, government. You're just so generous.
No, it means that you are prolonging paying on your debt.
And that was okay,
that was an okay route to take
if you lost your job,
maybe you were furloughed
and you just didn't have money
to even put your head above water financially.
If you had to go that route,
defer your payments for a month or two,
again, that's totally fine.
But if you keep going down that route,
what happens is, you're going to have to eventually pay that.
So, those payments just tack onto the end.
And then a lot of people with student loans,
they're like, well, it's zero interest, which is great.
So, like, I'm not really technically paying on more,
so I'm gonna go that route.
But again, when that's your mindset,
that means you're going to be in debt for a long time.
Debt is not about interest rates.
It's not about math.
It's about having the freedom of not owing anyone anything.
And when your income comes in,
you're actually the one that gets to control it,
and you get to do whatever you want to do with that income.
It's not dictated by anyone else.
And when you're in student loan debt,
which is usually a lot of people's,
their largest debt is what I'm finding,
besides a mortgage.
And man, it can seem like this massive mountain.
But remember, you're going
to have to pay this off eventually.
No one in office,
no tooth fairy is gonna come down.
Fairy. The tooth fairy. Amelia's freaking out
that she's gonna lose her teeth any day now.
That's the mom talking in me.
Fairy. No student loan fairy coming in
and is like I'm gonna just wipe it all clean.
It's probably not gonna happen, you guys.
You're going to have to pay it.
And again, if you are deferring your payments,
that means you are still going to have to pay that.
So, make a plan, attack debt
and get your student loans out of your life.
Okay, so those of you out there
that have a stable income,
keep paying on your debts.
Keep being gazelle intense, is what we call it,
paying it down, keep going.
Now, if you have lost your job,
then again, pause everything.
Stay current if you can,
if you can bring in any other income,
or if you get unemployment,
whatever you can to stay current.
Or if you have to, again, take that deferment
or forbearance for a very, very short period of time
until you can replace your income.
But stockpile cash.
Don't pay extra on your debt
because you're kind of in crisis mode if that's you.
You just want to make sure
that your food, shelter, utilities and transportation
are taken care of during this time.
And then, once you get your income stable,
maybe you get your job back
if your state reopens and you still have your job,
or you go get two part-time jobs,
or you find a new completely different job
with a different company maybe
and you're making your income back,
then take that money
you had stockpiled during the crisis mode
and throw it at the debt.
So, the key here
is to continue on the Baby Steps
once your income is stable.
And what I mean by stable
is not this elusive fear
of like, oh no, I might lose my job.
And if you're in an industry
that you know you will,
then sure, you want to plan for that.
But if you just have this elusive fear
that the whole world's gonna come to an end
and you're gonna lose your job 100%,
that's not the truth.
That's not factual.
So, focus on facts, remember that.
And then continue on with the Baby Steps.
And if you are unfamiliar with the Baby Steps,
this is a great time for you to sign up
for Financial Peace University.
We have a 14-day free trial for you,
and it is amazing.
It's gonna walk you through exactly what you need to know,
not just about the Baby Steps,
but about your debt, about budgeting,
about real estate, insurance,
how to really change your future
when it comes to your money.
So, make sure to check that out