Students urged to prioritise debt repayment
Published: 19 June 2008
By MoneyhighStreet Staff Leave a Comment
Updated: 30 November -0001
People about to graduate from university need to make an effort to prioritise and manage their debt as they approach adult life, an industry expert has suggested.
Richard Brown, chief executive of Moneynet.co.uk, acknowledged that debt was now a part of student life. However, he stressed that students needed to be sensible about how they approached paying back their borrowing.
According to the site, the best tactic for students concerned about their debt is to prioritise the most expensive borrowing and concentrate on paying this back as soon as possible.
"Student loans tend to be interest free and most other loans tend not to be," Mr Brown explained.
"Some people graduate with substantial student debt but it is a fact of life unfortunately, whereas carrying big wads of debt on a high interest credit card isn''t.
"It''s a common sense call when it comes to prioritising [what to pay off first]."
Recently, Defaqto.com reported that its analysis had shown that credit card borrowing has become more expensive in recent months.
In fact, the company said that the standard purchase rate per month on the average credit card is now 4.9 per cent higher than it was the last time the Bank of England set interest rates at five per cent.