ROHNERT PARK, Calif., March 23, 2018 /PRNewswire/ -- College students have been getting a lot of grief about using financial aid for expenses outside the intended use, such as spring break trips, concerts or unnecessary food, drinks and coffee. A recent report highlighted another use of that extra financial aid money: cryptocurrency investments. Ameritech Financial, a document preparation company that assists federal student loan borrowers in applying for repayment plans, reminds students that whatever they borrow, they must pay back eventually, so it may be wise to think thoroughly about expenses before spending the money.
"We know how hard it can be to get through college with a limited amount of money," said Tom Knickerbocker, executive vice president of Ameritech Financial. "Using student loans for living expenses can offer valuable money management lessons, especially when the budget is tight and students need to figure out how to spend their financial aid wisely."
Financial aid is intended to pay for tuition and fees first, and any extra money is refunded to the student to cover living expenses. Because no one polices that money, students must learn how to manage it on their own. That can be a hard lesson for some students, but the majority of them refrain from spending it frivolously. The myth of the overindulgent student, it appears, is loosening its grip.
According to a recent report, about one in five college students receiving financial aid has used that aid to invest in cryptocurrency. While investing extra funds and using any profits to pay down debt may not be a bad decision, this article suggests a high-yield savings account would be a safer move as cryptocurrency values may not be as profitable as they once were. Current college students wondering what they should do with extra financial aid (in excess of what they need for living expenses) may consider talking to a financial expert.
However, students should know that they will be responsible for paying back all financial aid they received in the form of loans, including any potential losses that may result from investments. If they took out more than they needed to or if their loan balance is high relative to their income after they leave college, federal income-driven repayment plans (IDRs) may help them afford their loan payments and get on track for successful repayment.
"The switch from spending loan money on spring break trips to investing it may be a sign that students are aware of the potentially difficult repayment process they face after graduation," said Knickerbocker. "At Ameritech Financial, we work to help borrowers who are ill-equipped to make their loan payments, whether their balances are too high or their income is not high enough. Our clients who apply for and become enrolled in IDRs hopefully feel that their loan payments are manageable."
About Ameritech Financial
Ameritech Financial is a private company located in Rohnert Park, California. Ameritech Financial has already helped thousands of consumers with financial analysis and student loan document preparation to apply for federal student loan repayment programs offered through the Department of Education.
Ameritech Financial is a member of the Association for Student Loan Relief (AFSLR), and each representative on the phone has received the Certified Student Loan Professional certification through the International Association of Professional Debt Arbitrators (IAPDA).
Ameritech Financial prides itself on its exceptional customer service.
To learn more about Ameritech Financial, please contact:
5789 State Farm Drive #265
Rohnert Park, CA 94928
SOURCE Ameritech Financial