Debt

Buying a home is a huge financial decision that you should treat with care. You will always be able to qualify for more debt than your budget can afford. One rule of thumb is to keep your total housing payment below 28% of your gross income. For example, if your gross salary is $100,000, then your monthly house payment should not be more than $2,333.

No. Paying off your credit card every month helps your budget and your credit score.

We generally discourage 401(k) loans and advise they only be considered as a last resort.

Student loans allow individuals to receive higher education with the promise that they will repay their loans in the future. Student loans range from government to private loans and each is treated differently. There are lots of different repayment plans available. Consider which option aligns best with your financial situation. It’s important to be consistent with your payments so you can qualify for any forgiveness plans that you may be eligible for. Student loans should not be used for investments or consumer products.

You should not have more than 36% of your monthly income going toward debt. For example, if your gross salary is $100,000, then your total monthly debt payments (home, car payment, student loans, credit card debt, etc.) should be less than $3,000 a month. It may be wise to practice making car loan payments for a month or two to ensure you are able to afford it.

There is always a way to improve your financial situation! Our financial planning team can help you make a plan to get out of debt and become financially healthy again.