Stock investing for dummies – Four Ways You Can Get Fired For Your Student Loan Debt



Stock investing for dummies

stock-investing-for-dummies For most people, student loan debt is the scariest right after graduation. If you haven’t lined up a job, even thinking about that seemingly insurmountable debt can be enough to warrant a panic attack. But eventually, most graduates settle into one job or another and begin the long process of repaying those loans. It’s all downhill from there, right?

Wrong.

Student loan debt can plague you in many ways throughout your adult life, but there’s one more frightening than the rest: you can get fired for your student loan debt. As if paying off debt with an entry-level income isn’t nerve-wracking enough, imagine trying to balance your finances after that income disappears.

So how does this happen, and what can you do to protect yourself from a student loan debt-induced pink slip?

Four Ways You Can Get Fired For Your Student Loan Debt

Even though you may consider student loans to be a private matter, some companies may see them as inextricably linked to your job performance. The fact is, 47% of employers conduct credit checks on applicants and employees according to the Society For Human Resources Management. And even though no studies have shown that debt impacts job performance, many employers view it negatively. They assume that if you’re struggling to pay your loans, you may be less focused on your job.


But just because they view it negatively, can it really cost you a job? Yes.

1. You Can Lose Your License And Your Job

First, in some cases, the government may also force your hand and, as a result, you can lose your job. About half of the country has laws that allow punishing graduates who have missed too many student loan payments by taking away their professional license. That means if you’re in a profession that requires a license to work – law, medicine, even cosmetology – you could lose your license and your job.

For a full list of states and the licenses that can be taken away, check out this list from the National Consumer Law Center.

2. Wage Garnishments Can Cost You Your Job

If you stop making payments on your student loans, they can eventually go into default. After a period of time, they may be sold to a collection agency who can get the right to garnish your wages. Wage garnishment means that your employer has to pay the collection company out of your paycheck directly. This also means that your HR department and your boss will instantly find out if you’re having money trouble.

However, the Consumer Credit Protection Act makes it illegal for your employer to fire you for having one wage garnishment. But you can be fired for having two or more garnishments. So, if you owe your loans and something else, your student loans can get you fired.

3. Some Employers Require Excellent Credit

Some employers regularly check their employees’ credit history, which will show defaults, late payments or accounts in collection. Even if your account was in good standing when you started working at the company, a sudden change could mean you’ll soon be filing for unemployment.

Many jobs require that the candidate have a good credit score. Who can trust you to manage a firm’s finances if you can’t manage your own? Some companies and government agencies also consider that employees in financial trouble may be susceptible to taking bribes or stealing from their workplace.

It’s currently legal to check an employee’s credit score when they’ve applied for a job if you give them permission. Refusing permission to let a prospective employer check your credit score can be enough to not be hired.

4. It Can Cost You Your Security Clearance

Finally, one of the key factors in getting a security clearance (which can be required for many military and civilian jobs) is to “maintain good financial standing”. Having a little bit of student loan debt shouldn’t hurt you, but having a lot of student loan debt (or student loan debt combined with other debt) could get you fired. Basically, to hold a security clearance, the government wants to make sure that you’re not likely to be influenced or be bribed.

Getting fired or not being able to find a job while you’re struggling to pay off loans can put you further in the hole. If you don’t have an emergency fund or back-up plan, you may find yourself taking on more debt to stay afloat. Even if you find a job quickly, the period of unemployment may further ruin your finances and destroy your credit.

How To Prevent Losing Your Job Because Of Your Student Loans

If you’re having trouble making payments, the first thing to do is to call your lender. People are much more willing to help you before you start missing payments. If you have a solid history of making payments on time, they will be more likely to find a solution. Remember, you’re not the first person who’s ever had this issue.

Federal loans have more gracious repayment options. You can defer your loans, have them go into forbearance or choose an income-based repayment plan – all of which could reduce your monthly payment. Check here to see what a monthly payment could look like with a new payment plan.

Even though private lenders may have fewer options, you should still give them a call. You may be able to refinance if you have a high interest rate. If you refinance to a lower monthly payment, you can pay extra on the months you’re able to and get rid of your debt as quickly as possible. Check out Credible and see if refinancing makes sense for you.

Preventing career fall-back from your student loan debt is really just about managing your debt responsibly. Do everything you can to be on top of your payments, and don’t let the cost of your degree cost you a job.

– stock investing for dummies

Learn How To Be #1 on Google Results



Source link