Should I reduce debt or increase savings?

Should I reduce debt or increase savings?

I know my debt is not going away anytime soon-should I begin to save money? I have a 60,000 student debt and I pay 1700 in rent for a two bedroom apartment. I have always put off saving because my school debt is so high but I live month to month and that scares me.  I am in my thirties and feel that I should have emergency money and money put away for my future. What should I do?

If you are able to make more than the minimum payment on your debt every month, it may be a good idea to begin to save 5% of your earnings. One of the principle arguments for saving is:  Save first then pay your debt, expenses etc.  It is always a good idea to get professional help from a trustee to develop a personal budget that suits your individual needs.

Savings generates taxable interest.  Paying down debt reduces non deductible interest expense.  Do what feels right for you as their is no correct answer.

Contact Rumanek & Company Ltd. for more information on bankruptcy and debt solutions. Or please fill out the free bankruptcy evaluation form. To learn more please visit our YouTube Channel. Rumanek & Company have been helping individuals and families overcome debt for more than 25 years.  


Read more from our blog