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Home > I lowered the interest rate!

I lowered the interest rate!

January 22nd, 2015 at 06:12 pm

Today is a bit better than yesterday. The kids are feeling better and I got a bunch of stuff done today. I was feeling overwhelmed yesterday and wanted to make sure today was at least better. I was looking over my bills, bank accounts, and student loan. I decided to call about the student loan and told them that I'd be more motivated to pay on time and not miss payments if they could help me out a little. They put me on an automatic pay plan where they withdraw the monthly payment every month and lowered my interest rate by .25%. It is now 4.5% rather than 4.75%. It might not seem like a lot, but it is because my student loan is now over $55K, unlike what I previously thought. As for the weird bill that went to collections and bounced back and forth to different agencies from 2011 up until now (I must have missed it when I paid off all of the consumer debt accounts...we seriously had that many credit cards at one point in the past), the account is now closed for good apparently and they are no longer collecting on it, both the credit company and the collections agency. Unfortunately it is just on my credit report, which is shot anyway, but at least I know what was going on. I also received the statement for my kids college Next Gen accounts...it was a letter stating what the fees would be...get this, it's going to be 1%, 4%, and 5% on the mutual funds we are investing in! I read about being warned on this by the Tony Robins investment book, which lets readers know that mutual funds have the highest (hidden) fee costs than most investments and to switch to low cost index funds from the 500's list...Which I will now do! After understanding the interest rate on my student loan and how much just .25% can change it good/or bad for the life of the account, I can not sit and be charged 5% on investments for the mutual fund account manager who makes money regardless of whether or not my mutual funds go up or down. (I also found it fascinating that I happen to deal with both today and finally understood the impact of every little percent counting. life is interesting). Anyway, for dinner I made chicken salad (using the shredded chicken for the chicken soup I made over the weekend) with shredded carrots and olives, with a baked potato with cheddar cheese and a sliced hard boiled egg on the side and sliced oranges for dessert. The kids loved it, which was great. I have been running out of produce a lot faster than I had anticipated and think that I will need to set aside a small weekly amount for fresh produce (maybe $10 or less). I have been recording the meals that the family eats so I remember and also be able to tell friends/perhaps family that don't believe that I'm actually home cooking all the meals and at a super low price. Tonight's meal had to cost below $.75, which made everyone happy. So, now back to re-budgeting. Now that I know that my student loan interest rate is pretty low, I will add more to the 401K side since they not only match the funds, but the interest rate is higher in terms of compounding interest.

4 Responses to “I lowered the interest rate!”

  1. snafu Says:

    Good on you, you've made some giant changes to take back control of finances and household operations. I'm quite confused by your comments on your 401K. What specific choices does the employer offer? What is your current allocation and what gives you a 'sleep at night, without nightmares, investment plan? Have you investigated the choices offered by Vanguard MFs? We often discuss that here because of their philosophy of low fees.

  2. turning a new leaf Says:

    oh, I have to clarify, I am anticipating to set aside part of our monthly budget for the 401K starting in February/mid Feb. I forget which investment group, but I am mostly talking about the company matching what we contribute, so I see that as making money with the anticipated annual rate of return (usually between 5-10%, I think). With our last employer we had them take out 15% of each pay check automatically, which really added up by the time we left, but I have to see what we can put aside. I have looked at vanguard and trowe price with their no load funds, but the book that I'm reading talks about the hidden fees that the account holders usually don't know about over the life of the account (communications expenses, investment expenses, trustee expenses). Anyway, we will look at mutual funds that only hold S&P 500 stocks and no special products etc.

  3. LittleMissSplendid Says:

    A lower interest rate is great news! That means more money you can put toward paying it off or your savings goals.

  4. Joan.of.the.Arch Says:

    That meal sounds good. Smile

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