SoFi

Getting married soon? Congratulations! Just be warned—there comes a moment in many weddings when half the guests suddenly slip away to watch a big game (just follow the cheers to find your wedding party).

Football especially is a pretty good analogy for a wedding – after all, in both football and marriage, you’re either tackling things together or you’re being tackled by them. Money is a common example of this (in marriage, not football), as the growing number of couples dealing with student loan debt can attest.

Whether the loans belong to you, your spouse or all of the above, once you get married it doesn’t really matter anymore. Paying off debt is now something you can tackle together. It may be tough, but with open communication and planning you can work as a team to get that student loan linebacker off your, er, back.

So what’s the best strategy for taking down student loans without letting them clobber your marriage? Here are five tips for proactively – and collaboratively – running a play that could help lead to the big pay-off: a debt-free happily ever after.

Tip #1: Create Your Big Financial Picture

Preparing to take on a big financial goal usually requires some conversation and preparation upfront. Before making any decisions, sit down and talk about your short- and long-term financial objectives, and make sure you’re both on the same page (or as close to it as possible). This can be an overwhelming topic, so see if you can break it down into chunks.

Have you established a household budget? How do student loans (and paying them off) fit into your long-term and short-term goals? Should you start aggressively paying off debt, or might it be better for you to ramp up over time? What other factors (e.g., buying a home, changing careers, having children, etc.) could affect your decisions?

Not only can this exercise help give you more clarity to create an action plan, it can also actually be kind of fun – after all, planning a life together is part of the reason you got married in the first place. The key is to listen to each other and remember that you’re both on the same team.

Tip #2: Take Advantage of Technology

Once you’re clear on the big picture, it’s time to get into the weeds. Many people have more than one student loan, often with multiple lenders, so a good place to start can be to gather all of your loan info in one place. You can use an online student loan management tool to collect this information, compare student loan repayment options, and even analyze prepayment strategies.

After crunching the numbers, your debt payoff strategy may include putting extra money toward your loans each month, which means creating and sticking to a budget that supports that goal. Platforms like Mint and Learnvest can help you aggregate household accounts and track spending.

Note: tracking your spending so precisely may feel like ripping off a bandage at first, but over time, this kind of discipline can help you better see where your money goes and help you make conscious choices about your spending. And once you have your budget in place, these apps can be set up to alert you both when spending is getting off track.

Tip #3: Define The Who, What, When

Whether your finances are separate or combined, you’ll probably want to come to an agreement on how to collectively pay all of your financial obligations. Many couples address this based on each person’s share of the total household income.

For example, if one person makes 40% and the other makes 60%, the former might pay 40% of the shared bills and the latter might pay 60%. Others find it simpler and more cohesive to have one household checking account and pay all bills from there.

However you decide to split things up, it could make things much easier to agree upon a plan that accounts for everything, because missed payments can potentially impact your credit (and/or your spouse’s), making your future financial objectives that much tougher to achieve.

Tip #4: Look For Opportunities to Optimize

Okay, so now you’ve established a plan and a budget, and you know who’s on point for each bill. You’re on the path to getting student loan debt off your plate. Is there anything else you can do to speed up the process?

Short of winning the lottery, the most common ways to accelerate student loan payoff are prepayment (meaning, paying more than the minimum) or lowering the interest rate, the latter of which is most commonly accomplished through refinancing.

If you qualify to refinance your student loans, you have a few possibilities: you can lower your monthly payments (by choosing a longer term) or lower your interest rate (which could also lower your monthly payments) – or you could shorten the payment term, and that means you could save money on interest over the life of the loan – money that could come in handy for those other financial goals you’ve both agreed to pursue.

Tip #5: Be on the Same Team

Living with debt is stressful for any couple, but being part of a relationship has its advantages, too. There’s a reason that weight loss experts often recommend finding a “buddy” to help cheer you on and keep you honest in your diet and exercise journey – and the same applies for achieving a big goal like paying off student loan debt.

Keep it positive and keep the lines of communication open, and you may even find that the journey to being debt-free makes your marriage even stronger – so you can take the hits that come your way as easily as your favorite team does.

The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Notice: SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. SoFi always recommends that you consult a qualified financial advisor to discuss what is best for your unique situation.

SLR15102

Millennials, that rather maligned generation of people born sometime between 1980 and 1995, are often the butt of jokes for being the “boomerang generation .” You know, because they seem to leave the comfort of their parent’s homes only to return again when they realize they can’t find a job or pay the bills in post-collegiate life.

And sure, many young people do indeed return to the welcome embrace of mom and dad, but it may not be because they want to. In fact, most would rather be living the American dream of owning their own home.

According to 2017 data from Apartment List , 80% of millennials want to buy a home one day. However, if you’re wondering, “How long does it take to save for a house?” there are a few things you should know.

Most of those same millennials noted in their responses that economic hardship (thanks to mounting student loan debt , low wages , and an unstable economic environment) will likely delay their homeowner dreams. And for many, it comes down to the fact that they can’t seem to save enough for that dreaded 20% down payment.

As the data additionally showed, 68% of millennials have less than $1,000 for a down payment in an account right now. Another 44% said they have not saved anything for a down payment at all. And 39% said they aren’t saving for a down payment on a monthly basis.

But, if buying a home is a top priority for you, there are ways to make that happen. Here’s how to save for a house while you’re still renting.

5 Tips to Save for a Home While You’re Still Renting

Pay Down Your Debt First

In order to save for a house, it’s imperative that you figure out a plan to pay down your existing debt. And for 30% of millennials , that means paying off more than $30,000 in student loans. And though that may seem like a monumental amount of money to pay off, there are ways to do it.

First, if you’re a full-time employee, reach out to your company’s HR department to learn more about student debt repayment assistance. Though Inc reported just 3% of companies in the U.S. currently have this type of assistance, it’s still worth a try.

As a more drastic measure, you could always think about going into a profession that offers partial or total student loan forgiveness (such as teaching in certain public schools), or moving to a state that will also help pay off your student loan debt just for moving there (including Alaska, Wyoming, Washington State, Florida , and more).

For a much easier fix, you could always think about looking into student loan refinancing. If your current interest rate seems unreasonably high, check out SoFi’s student loan refinancing options. By dropping your interest rates, you could significantly reduce both your payments and the length of time you’ll be making them. Which in turn could help you save for a house even while getting out of student loan debt.

Create a Budget That Will Help You Spend Less and Save More

Look, we’re not saying eating avocado toast at brunch on Sundays is really breaking the bank, but indulging in luxurious habits day after day can really add up. Creating and sticking to a realistic budget can help you spend less while saving for a house. To get there, all you need to do is follow these simple steps.

Gather your data: Figure out how much you’re earning each month (after tax), along with how much you’re currently spending. Add it all up including cell phone bills, insurance, grocery bills, rent, utilities, your coffee habit, the dog walker, gym membership, etc. Don’t miss a dime.

List your current savings: Are you currently putting money into an IRA, 401(k), or other savings plan? List it, so you can see what you’ve already got in the bank.

Really dig in and be harsh about your spending: Can you cut back anywhere? How about on that gym membership? Maybe it’s time to join 24 Hour Fitness over Equinox. How’s your takeout habit? If you really want to save for a house, you may need to learn to cook. And next time you go shopping for new clothes, make sure to clean out your closet first to ensure you actually need to buy new dress shirts.

This, admittedly, is the worst step in the budgeting process, but it’s crucial to be honest with yourself about your spending. Look on the bright side, all that hard work could help you get a new home years sooner.

Finally, remember to check in on your budget every so often and adjust as needed. For example, if you land a new job, get a promotion, or are given an annual raise, perhaps you can be adding that money to your savings account, or put it toward paying off your loans. Whichever one feels more important to you is OK, so long as that extra cash isn’t going toward more weekly lattes .

Invest With a Wealth Management Account

If you’ve paid off your debt, set realistic budgeting goals, and are raking in some dough to add to a savings account, you’re already on the right track. Now all you need to do is put your money to work for you. To make that happen, consider opening a SoFi Invest account.

With an online investment account, you can set targeted goals that are personalized for you. In this case, your goal would likely be to purchase a home within a set number of years, and SoFi can help you figure out an investment plan accordingly.

After setting a few targeted goals, you can work with a real-life financial advisor who will walk you through how to strategically invest your money so that it works for you. And we will never push you to take more risk than you want to—tell us what your risk tolerance is, and we’ll work with it. Our financial advisors will cost you $0, so no need to budget extra for that.

Automate as Much of Your Finances as Possible

This is a lot of information to process, but once you get through all the work upfront, you can start automating as much as possible. For example, have a portion of your paycheck automatically go into your savings account each month.

Then, automate a certain dollar amount to head to your SoFi Invest® account. The rest can then go into your checking account and be divvied up at will. This means less stress for you and more time designing your dream home on Pinterest. Just remember to invite us to your housewarming party when it all comes together.

SoFi can’t guarantee future financial performance.
This information isn’t financial advice. Investment decisions should be based on specific financial needs, goals and risk appetite.
The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Advisory services offered through SoFi Wealth, LLC, a registered investment advisor.

WM18143

In some ways, taking out a car loan can feel more stressful than doing your taxes and going to the dentist—combined. With so many options, how do you know if you’re choosing the right one? Auto loan FOMO is enough to keep you up at night.

Instead of thinking about all the opportunities for fun you missed out on, you’ll be asking yourself questions like-how much should you spend on a car? Am I paying too much on my current car loan? What is a good APR for a car? What does APR even mean?!

Obviously, you don’t want to pay more than you need to on your car loan. So, just how much is the typical American paying on their auto loans? According to Experian , the average amount that people borrow when buying a new car is a record $31,099 and the average amount borrowed for a used car is $19,589. In the same report the average monthly car payment was $515 for a new car or $371 for a used car.

Monthly payments might be at an all-time high, but so are term lengths with most Americans choosing term lengths of over 69 months to repay their loans on new vehicles on average and 64 months on average for used vehicles, according to Experian.

So, what should you do if you’re paying more or less than that and how much should you be paying in interest? Don’t worry–we’ve got answers for you.

What is a Good APR on a Car?

Wondering how much American borrowers are shelling out in interest? According to Value Penguin ,the average interest rate on auto loans over 60 months is 4.21% APR in 2018, but what you will actually pay will depend in part on your credit score.

They claim that on average you’ll pay 3.60% APR on a 60-month auto loan on a new car if your credit score is between 720-850, 4.95% APR if your score is between 690-719, 7.02% APR if your score is between 660 and 689, 9.72% APR if your score is between 620 and 659, 14.06% APR if your score is between 590 and 619, and 15.24% APR if your score is between 500 and 589.

Bankrate , which more frequently tracks rates on auto loans, says that as of May 23, 2018 the average rate on a 60-month new car loan was 4.68% APR, the average rate on a 48-month new car loan was 4.62% APR, and the average rate on a 36-month used car loan was 5.21% APR.

Recommended: What Credit Score Do You Need to Buy a Car in 2022?

What to Do If Your Car Payments are Too High?

No matter how much you love your car or anticipate loving your car, you don’t want to pay more than you have to for your auto loan. But many people do and don’t do anything about it. These are the same people who clip coupons to save $1 on mustard and sleep outside of big box stores to get $50 off on a TV on Black Friday.

Yet, when they have a chance to save hundreds or thousands of dollars on their car loan–they don’t realize that all they have to do is fill out an online application to see if they qualify to refinance their car loan at a lower rate.

If your car payment is higher than average, refinancing for a lower interest rate is a good way to lower your payments. Just how much can a lower interest rate save you over the course of a 60-month auto loan?

For example, if you bought a new car for the average price of $31,009 and paid a 10% down payment of $3,100 on it, you would pay $566 per month if you were charged 8% APR. In total, you would pay $6,044 in interest over the life of the loan. But if you managed to lower your interest rate by refinancing to just 6% APR, you would pay just $540 per month and just $4,464 in interest. That’s a savings of $26 per month and a savings of $1,580 over the life of your auto loan.

What if Your Car Payment is Lower Than Average?

If your car payment is lower than the average, then you don’t have to do anything, right? Wrong! Just because you’re paying less than your neighbor probably is doesn’t mean you can’t still save money by refinancing it!

After all, interest rates change over time and could have gone down since you’re initial loan. The same thing can be said if you improve your credit after you take out your car loan or if you didn’t shop around when you took out your loan. Since you can save even if you can only cut a percentage point or two off the cost of your loan, it makes sense to check refinancing rates every so often.

Refinancing an Auto Loan to Lower Your Monthly Payments

Most people assume that the only way to refinance an auto loan is with another auto loan. But that’s not the case! In fact, taking out a personal loan in order to pay off their auto loan can be a viable option.

There are a few reasons why refinancing an auto loan with a personal loan can be an attractive idea. The first is that you might be more likely qualify for a lower rate or a fixed rate loan if you choose a personal loan over an auto loan. In addition, you could be able to choose from more term length options.

That’s because personal loans tend to offer a wider range of term lengths allowing you to take out a loan for anywhere from 1 year to 10 years. This might be a good choice for you if you’re concerned about reducing your monthly payments since spacing out your repayment over a longer amount of time reduces your monthly car payment.

In contrast, auto loans typically restrict your term lengths to around 60-months or five years because they are using your car a collateral on the loan and it depreciates quickly. If they make the term length too long, your car is no longer worth enough to secure the balance of your loan.

One to consider is that if you have an older car and you’re wanting to refinance it over a longer term length, you might not be able to do so with an auto loan since many auto lenders have strict criteria around the makes, models, and age of the vehicles that they will refinance.

Collateral is another reason why you might want to take out a personal loan over an auto loan if you’re considering car refinancing. That’s because with an auto loan your car is used as security against the amount you owe. That means that if you get behind on your payments, the lenders can repossess your car. In contrast, personal loans are unsecured loans.

While secured loans often have lower interest rates than unsecured loans, auto loans can sometimes charge you higher rates than many online personal loans depending on your personal financial situation and credit.

Other downsides of taking out a secured loan is that you have to repay that loan when you sell your car. If, for some reason, you owe more on your loan than you get for your car – you will still need to repay that money immediately. If you buy another car, you will need to take out a new loan. With a personal loan, you can sell your car at any time without changing the terms of your loan.

If you’re looking to take out a new auto loan because you’re buying a new car, there are other benefits to getting a personal loan over an auto loan. Unlike most auto loans, you are not required to put a down payment on your car if you use a personal loan to buy it.

That means that you don’t have to wait to buy a car until you have saved enough for a down payment. This is particularly useful if you have to suddenly buy a new car because your old vehicle broke down and you don’t have enough in your emergency fund to cover that 10% to 20% down payment.

When to Refinance Auto Loans?

If you want to reduce your monthly auto loan and are trying to decide between getting a personal loan or an auto loan, it’s important to shop around to see what kind of rates you qualify for and to spend some time considering what kind of loan is best for you.

Some people find that they can save more with an auto loan, whereas others can save more with a personal loan. Sometimes people choose which loan is right for them based on which terms better suit their needs.

The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

SoFi’s Insights tool offers users the ability to connect both in-house accounts and external accounts using Plaid, Inc’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score provided to you is a Vantage Score® based on TransUnion™ (the “Processing Agent”) data.
¹SoFi’s Insights tool offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc’s service. Vehicle Identification Number is confirmed by LexisNexis and car values are provided by J.D. Power. Auto Tracker is provided on an “as-is, as-available” basis with all faults and defects, with no warranty, express or implied. The values shown on this page are a rough estimate based on your car’s year, make, and model, but don’t take into account things such as your mileage, accident history, or car condition.
SEO18108

Becoming a franchise owner can be a great way to fulfill your dreams of entrepreneurship. Perhaps you have the savvy to run your own business, but are not interested in starting an original venture or putting together a brand from scratch. Buying into a successful franchise operation can give you the rewards of business ownership without as many of the headaches.

When you buy a franchise, you’re not exactly buying a business. Rather, you buy the rights to utilize a business logo, name, and products. In many cases, you maintain an ongoing relationship with the main company, which supports you with things like marketing materials, training programs, and supply. Popular franchises include fast food outposts such as Subway and McDonald’s or hotels like Motel 6. Other franchises include car rental chains, hardware stores, and gyms.

Of course, to own a franchise and cash in on the benefits that come with it, you have to invest up front. And the cost isn’t exactly pocket change. Depending on the industry, opening a franchise can cost as little as $10,000 or up to several million dollars.

But most franchises require $50,000 to $200,000 to launch. Chances are you will need outside financing to launch your franchise. Here are the steps to look at if you’re thinking about getting into the franchise world:

1. Compare Cost Versus Value of Opening a Franchise

Compare the costs of opening the franchise to the expected benefits. On the cost side, include franchise fees, royalties, marketing expenses, and what you’ll pay for products. On the plus side, estimate your projected revenue, along with benefits like training, site selection, and recipes. Then decide whether moving forward seems worth it.

2. Vet the Franchisor

A Franchise Disclosure document will tell you about black marks in the company’s history, including bankruptcies and litigation. It will also help you figure out whether the company’s franchises are expanding or closing, and how the parent company is doing financially. If franchises have a high failure rate, take note. It can help to have a lawyer take a look as well and to talk to other franchisees to get their perspective.

3. Scope Out the Market

Make sure your area isn’t already overloaded with other franchises from the same company. Also, look at competitors outside of the brand who have similar businesses, and gauge their success or failure rate.

4. Figure Out How Much of Your Own Money To Invest

You don’t want to risk too much of your own funds to open a franchise. Experts suggest investing no more than 15% of your net worth. The rest can be financed by partners, the parent corporation, or loans from other institutions.

5. Apply For A Traditional Or Small Business Administration Loan

Given the cost of opening a franchise, it makes sense that many new owners need help with financing. Nearly 40% of franchise owners use a loan from a commercial bank to get started, according to the U.S. Small Business Administration.

One option is to apply for a traditional loan from a bank or credit union. Keep in mind that these financial institutions often require you to have significant collateral and a strong credit history, and they charge high-interest rates.

You may also have trouble borrowing from traditional lenders if the franchise you’re opening doesn’t have a history of brand awareness or impressive financial performance. If you’d prefer not to put up collateral (like your house), finding an alternative to traditional loans might be a better fit.

Small Business Administration loans are another option available to all business owners, including franchisees. Because the agency guarantees these loans, you may get better terms or lower interest rates from your lender. The SBA offers financing for franchises that are part of its Franchise Directory .

6. Apply For Franchise-specific Financing

If a traditional or SBA loan isn’t right for you, franchisees have some financing options that are not available to other business owners. Some franchisors offer funding themselves or partner with lenders to offer loans. There are also companies, such as BoeFly and Fundation, that specialize in funding franchises.

So there you have it, a few tips for getting started with franchise financing. Good luck!

The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

PL18102

You love your car, whether it’s a bare-bones hatchback or a souped-up Escalade. After all, it gets you places and keeps you from having to wait outside in the cold for the bus.

But maybe you’re struggling to make the payments on your auto loan, or you’re worried your interest rate is higher than it should be. No one likes to overpay, and there are a lot of reasons why you might be paying more than you need to on your auto loan. So how do you lower your monthly car payment?

The easiest fix is to refinance your auto loan. Refinancing a car will allow you to potentially qualify for a lower interest rate on your loan. This could potentially save you money, lower your monthly payment, or both. Or, you can also look into extending your repayment over a longer period of time.

But before you get on the phone with your car dealer to ask about your auto loan, you might want to consider the different ways you can refinance. Many people assume that the only way to refinance an auto loan is to replace it with another auto loan—but that’s not actually the case. In fact, you might find that using a personal loan to refinance your auto loan is actually a better idea.

When it’s Smart to Refinance a Car

There are a lot of reasons refinancing a car could be a great idea. One common reason is that you have improved your credit score since originally taking out your auto loan, so you’re likely to qualify for a more favorable rate now.

That’s partly because if you take out an auto loan and make your payments on time, often your credit will naturally improve as long as you’re diligent when it comes to credit in other areas of your life as well.

But there are other reasons you might suddenly qualify for a better interest rate. Maybe interest rates have gone down since you originally took out your loan, or maybe a slick car salesman convinced you to get an auto loan directly from the dealership–and charged you a premium for it. You might have gotten your ride more quickly, but you’ve since realized that you’re throwing money away on your auto loan.

One final factor that could be important when considering when to refinance a car is whether you need a lower monthly payment. Life changes fast—and sometimes you don’t have as much expendable income as you once did. Refinancing allows you to lower your interest rate, but it also lets you extend the term of your auto loan so that you end up paying less monthly.

Auto Loans vs Personal Loans

When it comes to refinancing your car loan, you can either get another car loan, or you can think outside the box and get a personal loan to pay off your car. An auto loan is a secured loan in which your car is used as collateral.

That means that if you don’t make your payments, your car can potentially get repossessed. In contrast, a personal loan is an unsecured loan that you can take out for [personal, family or household purposes. There is no collateral involved. Personal loans often have broader terms, options, and rates—and they can cost you less over the course of your loan.

One important thing to note is that since auto loans are amortized loans, you pay more interest at the beginning of your loan. So the sooner you’re able to refinance your auto loan for a lower rate, the more you’ll save.

To start the refinancing process, you first need to consider how much you’re currently paying on your auto loan. Look at both your monthly payment and your interest rate. Then you need to figure out what your refinanced interest rate and monthly payment would be if you used an auto loan versus a personal loan.

If you didn’t have great credit when you took out your auto loan, you could be paying from 7% to 15% interest on your car loan. By refinancing, you might be able to qualify for a new auto loan or a personal loan, with interest rates starting around 4% or 5%.

Deciding Between the Two

Personal loans are beneficial because you can take them out for personal, family or household purposes, and you have a wide range of what the loan can cover. Also, if you have good credit and a steady income, the interest rates that you’ll qualify for on a personal loan can be very competitive.

You’ll likely be able to get better terms on your personal loan—like the option to extend your payment schedule—and there might be fewer hidden fees. SoFi, for example, offers personal loans with zero fees or hidden costs.

When it comes to refinancing your auto loan with a brand-new auto loan, one key benefit is that you could be more likely to qualify if you don’t have good credit. And you could still get a lower interest rate, because it’s a secured loan.

However, the terms on your refinanced auto loan aren’t likely to be as good. For example, if your car is too old, you might not qualify for refinancing at all. Furthermore, an auto loan is usually tied to things like the age, make, and model of the car.

If you are able to refinance, you might not qualify for a desirable term length because the depreciation on your car might not make it worthwhile as collateral. In addition, you could struggle to refinance your auto loan if you currently owe more on your car than your car is worth—either because you paid too much for your car or because your car depreciated quickly.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website . on credit.

PL18147