Making Money from Consolidated Student Loans Mahopac NY

One of the great things about student loans in Mahopac, and consolidated student loans in particular, is the low interest rate. By consolidating your loans you sometimes see a drop in the interest rate by 1-2%. It seems small and insignificant, but if you follow the tips from this article you can actually turn that reduction into profits.

Local Companies

Mdi
(718) 932-2994
7701 21st Ave
Flushing, NY
Genesis Financial Group
(631) 254-0420
2106 Deer Park Ave
Deer Park, NY
Pyramid Financial
(516) 355-2274
24603 Jericho Tpke
Bellerose, NY
Continental Mortgage Bankers Inc
(516) 876-8500
1025 Old Country Rd
Westbury, NY
Cohoes Savings Bank
(518) 945-2222
320 W Bridge St
Catskill, NY
Homebridge Mortgage Bankers Corp
(516) 682-9100
60 Oak Da
Syosset, NY
Nbt Bank
(518) 371-0484
225 Guideboard Rd
Clifton Park, NY
Citifinancial
(631) 423-1020
570 Jericho Tpke
Huntington Station, NY
Keybank
(607) 749-7201
25 W Main St
Cortland, NY
Dime Savings Bank of Williamsburgh
(718) 353-3911
59 Main St # 23
Floral Park, NY

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How to Make Money From Your Consolidated Student Loans

Author: RJ Licata

One of the great things about student loans, and consolidated student loans in particular, is the low interest rate. By consolidating your loans you sometimes see a drop in the interest rate by 1-2%. It seems small and insignificant, but if you follow the tips from this article you can actually turn that reduction into profits.

As mentioned above, consolidated loans typically provide you with a lower interest rate than unconsolidated loans. They also offer repayment plans that can extend for up to 30 years. If you are a disciplined person who has a little bit extra money, you can use the money you save on payments each month to earn you cash.

Here's how it works. When you consolidate, your payments are usually lowered, which means there's extra money between what you used to pay each month and your new minimum payment. Instead of taking that extra money and spending it on impulse purchases and fun, it would be a good idea to use it to pay off extra principle on your loan. This can drastically cut down on the length of your loan, meaning you'll pay less in interest. Not a bad idea. But it will only save you money, not earn it.

In order to earn extra money from your consolidated student loans you'll need to take that extra money each month and invest it into a money market fund that has historically earned more than your current interest rate. For example, if your consolidated interest rate is 6.5%, you'll want to find a mutual fund that has consistently returned 10-12% or more. Then you'll earn 4-5% on your extra money every year. And here's the best part: doing it now will allow compound interest to kick in, so after the life of the loan you'll have a nice nest egg of profits from the money you were expecting to spend every month anyway.

And that's not all! Federal student loan interest is tax deductible. So you'll be able to claim the interest you pay on those loans every year, saving you even more money.

Keep in mind that while all this sounds great, there are risks involved. Although over time the stock market has been stable, there is a small chance you could lose your investment or make less in returns than you're paying in loan interest. For these reasons it's best to seek professional consultation before making any sort of investment.

With that said, this method is considered low risk and should at least be contemplated if you're fortunate enough to have some extra money each month.

Visit School Loans Consolidation Guide for more student loan advice such as facts about your federal school loan and information on how educational loan consolidation works.

About the Author:

RJ Licata is a freelance writer and internet marketer. More on RJ's current projects can be found at RJLicata.com.

Article Source: http://www.articlesbase.com/personal-finance-articles/how-to-make-money-from-your-consolidated-student-loans-956048.html