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Graduates 'should prioritise debts'
Monday, 23 June 2008
Life after graduation
Graduates should concentrate on paying off any high-interest credit card debts early and then focus on their student loan repayments, an expert has claimed.
Moneynet.co.uk has noted that the interest on a credit card will accrue significantly faster than that of a student loan.
Recent data from the Student Loans Company indicated that it paid out over £3.9 billion between 2007 and 2008, an increase of some 32 per cent.
Chief executive of moneynet.co.uk, Richard Brown said that, while graduates should be careful to keep up with their student loan repayments, it makes good financial sense to clear more pressing debts first.
"Some people graduate with substantial student debt but it is a fact of life unfortunately, whereas carrying big wads of debts on a high interest credit card isn't," he explained.
Price comparison site uSwitch has criticised high street banks for being too eager to issue credit cards without checking customers' financial backgrounds, reports the Times.