Can you pay off student loans with bitcoin

And I wouldn't recommend doing that, either. And in December , I started my blog The Best Interest to help pay it forward and share the advice that helped me succeed. In , I knew a small fraction of the personal finance information that I know today.

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I've learned by reading articles and blogs, and asking questions on financial forums like the Bogleheads and Reddit. Over time, I began to realize that many personal finance principles aren't as intimidating as they might seem at first. You just need to find the ones that resonate with you.

Different Types Of Cryptocurrency Transactions

I learned a lot from reading economist Burton Malkiel and the late Vanguard founder John Bogle's insights about the wisdom of index investing , and You Need a Budget founder Jesse Mecham's writing about the mindset and behavior behind budgeting. One of the key things I learned was the importance of compound interest — the way that investment money grows over time. Understanding compound interest will rewire your brain. You'll stop seeing items in terms of today's dollars and start seeing them in future dollars. That car seems cool but not as cool as "buying" five years of time for yourself.

Financial Repercussions

Retirement accounts like Roth IRAs and k s are often referred to as "tax-advantaged" accounts. With k s , you make pre-tax contributions to the account, which in turn lowers your taxable income. And with Roth IRAs, you pay tax on contributions, but the money grows tax free and there's no tax on future withdrawals. I highly recommend investigating what types of tax-advantaged accounts you qualify for because you might be leaving free money on the table, especially when many companies will also offer an " employer match ," up to a certain percentage of your salary.

Investing can be intimidating if you've never done it.

But one of the ways that I confidently and wisely invest is through index funds. Rather than choosing individual stocks and relying solely on their success, an index fund contains huge swaths of entire markets. Some companies will grow quickly while others will fall by the wayside. But on the whole, an index fund balances the good and bad to provide, ideally, a net increase.

Index investing is an easy choice for me because, in my opinion, it has the highest ratio of positive investment gains to investment stress. Index investing yields returns for me without having to think about it and I can attribute a considerable portion of my financial growth to the money I've socked away into index funds using my tax-advantaged accounts.

Budgeting has played a pivotal role in my past six years. It has drastically reduced my stress, since I always know if I have enough money to cover my needs. It's made spending more fun, since I get to make those occasional big purchases knowing that I've successfully saved for months.

1 in 5 College Students Used Loans for Cryptocurrency Investments

Create a personalised content profile. Measure ad performance. Select basic ads. Create a personalised ads profile. Select personalised ads. Apply market research to generate audience insights. Measure content performance. Develop and improve products. List of Partners vendors. Some college students consider trading cryptocurrencies to be a better use of their student loan money than traditional spending, such as school supplies and other living expenses.

According to a study by The Student Loan Report, over one-fifth of university students with student loan debt indicated that they used their borrowings to invest in digital currency such as bitcoin as reported by the New York Post. Also, students receiving federal student aid through loans can sometimes have excess funds, which can be used in any way that a student chooses, including investing. While school administrators may look down upon the practice of using borrowed funds for non-school expenses, college students are able to use loans for "living expenses," a flexible category that covers a wide range of potential necessities.

The U. Department of Education program called Federal Student Aid has guidelines for students who are receiving financial aid. Typically, once a student loan is approved, the funds are placed in the student's account at the college. The money is used to pay for expenses such as tuition, room, and board.

However, there are times when the loan funds exceed expenses, which is called a credit balance. The school must pay the student or parent the credit balance in the account within 14 days unless the student notifies the school that the funds are to be used for future expenses.

As a result, college students can receive a refund check from the college for the credit balance. The students can use the funds for books, other expenses, or whatever they choose. However, the funds still need to be paid back as part of the outstanding student loans. In other words, there's nothing that prohibits college students from spending their refund check on whatever they want, including investing in cryptocurrencies.

Investing in the crypto-market can be a way to quickly add to the debt burden if bitcoin and other cryptos plummet in price. Conversely, for the lucky ones, an appreciation in crypto prices could help students pay off their debt faster. For those investing in the digital currency, they would have had to time the market perfectly in to realize all of those gains. For college students who are borrowing to invest in cryptos, they'd likely be better off putting that money to use and invest in themselves by obtaining a graduate degree or a professional certification.

How to Pay Off Student Loans | Manage Student Loan Debt | TaxAct

It's important to consider that when investing in digital currencies, there's the risk of loss and past prices don't guarantee future results. If the market doesn't go the right way, college students may get more of an education than they had planned on, including the ins and outs of market corrections. New York Post. Federal Student Aid. The Federal Reserve. Households in - May Bureau of Labor Statistics. Student Loans. Your Privacy Rights.