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Millions of Americans spend their working days dreaming about retirement. Yet millions of Americans also fail to take the crucial financial steps they should take before becoming a retiree.
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While many understand it’s important to pay down loans, they’re often focusing on the wrong ones — prioritizing their mortgages, which have lower interest rates, rather than expensive high-interest accounts.
Here are the three loans you should pay off before even considering retirement.
Personal loans and credit cards
Personal loans and credit cards generally have the highest interest rates. This is especially true with credit cards, which currently have an average interest rate of 24.59% in the United States, according to LendingTree.
While credit card balances should be paid down quickly and well before you retire, you also shouldn’t let them delay saving for your retirement.
Instead of putting off saving, consider consolidating your debt with a personal loan from Credible.*
Depending on how much interest you pay on your credit cards, a debt consolidation loan could save you thousands of dollars.*
With Credible, you can borrow up to $100,000 (with no collateral) at interest rates as low as 5.40% APR with autopay, and repayment schedules ranging from 24 to 84 months.
Read more: This Pennsylvania trio bought a $100K abandoned school and turned it into a 31-unit apartment building — how to invest in real estate without all the heavy lifting
Auto loans
As of December 2022, the average new car loan for a buyer with great credit was 8.6%, according to MyAutoloan.
But if you have bad credit, that average soars up to 22.16%. The average monthly car payment recently spiked to $700, with many people grappling with $1,000 car payments
One way to get car costs under control is by finding a more affordable insurance provider. Luckily, BestMoney's* online insurance marketplace exists to combat these high costs and ensure your getting the best coverage without breaking the bank.
BestMoney allows you to compare mutiple quotes to make sure you’re not overpaying for auto insurance. When you fill in some information about yourself and your finances, they’ll instantly sort through many insurance companies to find you the lowest prices available in your area.*
School loans
College loans are some of the longest-lasting debts Americans deal with. What’s more, those loans may increase as you near retirement if you’ve borrowed money to help children through college, too.
Americans should find a strategy to pay off their student loans that involves scheduled payments taken out on a regular basis, so you can pay off debt faster and bring you closer to your retirement goals.
Through Credible — an online personal loan marketplace— you can tackle student loans efficiently through student loan refinancing.*
Essentially, what this means is that you can take out a new loan with a lower interest rate or monthly payment, use it to pay off your existing debt, then start making monthly payments on your new loan instead.
Credible lets you shop around for better rates* on your student loan. They’ll show you prequalified refinancing rates from up to 10 lenders and make it easy to pick out the best option.
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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
