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Why I wouldn't tap retirement savings to retire student loans

May 30, 2012
I returned to graduate school and accrued about $45,000 in federal student loans. The interest rate on these 10-year loans is 6 percent, with repayment beginning in 2013. I also have a 401(k) worth about $100,000 (roughly $60,000 of my contributions and $40,000 of employer contributions). I realize that an early 401(k) withdrawal would result in a 10 percent early-withdrawal penalty and that any withdrawal would be considered taxable income. This would effectively reduce the amount the 401(k) would need to earn in order to be the better investment. Still, it can't be much less than 6 percent, can it? Is there anything about my assumptions that are wrong, or is there anything I am overlooking? Derek, Chicago, IL
Posted In: student loans, retirement savings, debt

U.S. Treasury yield hits 60 year low

May 30, 2012
As investors cope with uncertainty in Europe, the interest on the 10-year Treasury note, the benchmark cost of U.S. debt, hit a record low of 1.6 percent.
Posted In: U.S. Treasury, yields, debt, spain

Financial innovation and social lending

Apr 16, 2012
Peer-to-peer lending, also called social lending, is bringing together online individual lenders and individual borrowers for a fee. They cut out banks and other mainstream lenders. The innovation appears to be working.
Posted In: peer-to-peer lending, social lending, Credit Cards, debt, consumer loans, invest, financial innovation

Letters: Taxes!

Apr 13, 2012
Host Tess Vigeland along with Sr. Producer Paddy Hirsch and tax expert Louis Barajas answer listener tax questions and emails.
Posted In: letters, college, debt, Taxes, tax preparers

Demystifying the national debt

Apr 10, 2012
The U.S. national debt -- currently clocked at $15.6 trillion -- is a major issue that'll shape the election this fall. But where did it come from and what does it mean for individual Americans? A new book uncovers the numbers.
Posted In: debt

In the spotlight: Senior student debt

Apr 6, 2012
People age 60 and older owe more than $36 billion in student loans. Tess discusses the latest debt bubble with Marketplace Education correspondent Amy Scott.
Posted In: debt, loan student debt, senior citizen, elderly

Taxes and a home equity loan

Mar 28, 2012
Hello. I'm 50 and single. I have a 15-year mortgage at 3.5 percent. My income is more than $80,000. I have a Roth and I am maximizing my company's 403(b) account. I have no credit card debt -- no debt in general except the mortgage, so I don't have a lot of write-offs. Does it make sense to get an equity loan and finish my basement so I can get a bigger write-off on taxes while investing in my home, or should I continue to just sock money away because it is better to not have debt? Thanks. Lisa, Salt Lake City, UT
Posted In: home equity loan, debt, Savings, Taxes

Finding ongoing debt management advice

Mar 27, 2012
Is it possible to find free/sliding scale ongoing debt counseling? A friend in Louisiana is in her 60s and facing the consequences of years of terrible financial decisions. I think she's beyond the point where one session of debt counseling could help her. I've seen patterns in her that I've seen in others who grew up poor: When they were young, they learned there was no way to ever catch up financially and be in control. So she has no sense that it is possible to be in control of her money. Thank you, Robin, Boston, MA
Posted In: debt, debt counseling, debt management, NFCC

Go North, young man!

Mar 21, 2012
The promise of steady work is attracting workers of all ages to Williston, N.D., and creating a new boom town on America's energy frontier.
Posted In: North Dakota, Oil, man camp, Williston, employment, debt, energy

A possible change for bankruptcy and student loans

Mar 21, 2012
Current laws make it very hard for student loans to be forgiven. There's a proposal now in Congress that would change that.
Posted In: bankruptcy, student loan, debt

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