00:00Hello everyone, I'm Sally Krawcheck and welcome to Up Close in Financial with
00:04Refinery29. I'm the CEO and co-founder of Ellevest, which is a digital
00:09investment platform for women. I built a career on Wall Street and I'm so happy
00:14to be here with you today.
00:19Tell me a little bit about you. Hi, my name is Ash and my wife is in $120,000
00:25of student loan debt. The interest rate is about six percent. Our monthly payments
00:29are just about paying off the interest. We make a combined income of $75,000 a
00:35year. So look, I think the the rate on this debt I don't love. I always say that
00:41if you can get a rate below four percent, that's good debt. I don't love this this
00:46debt for a bunch of reasons. I don't love it because it's a lot and it's a lot and
00:50you know versus your income. But I don't love the interest rate. It can't hurt to
00:56call and talk about reducing it. I would guess your chances of doing that are
01:00pretty low. One thing that is almost never comes up and is everything's worth
01:08thinking about so thinking about is bankruptcy. I think less than one
01:12percent of individuals who declare bankruptcy even try to get the student
01:17loan discharged and of those that do ask 40 percent get some portion of it
01:23reduced. We hate bankruptcy because we we just we're women and we do what we say
01:29we're gonna do, right? And we repay our debts and we keep our promises. But if
01:34you're telling me that this is crushing and we can't take it and it has
01:38implications for your credit later, there are points at life in which it's okay to
01:42say, look, I'm in a position, you know, maybe I have to look at some other options.
01:47Thanks for your advice. For those of you who have student loan debt out there, the
01:51name of the game always is to try to reduce that interest rate on the debt.
01:55So there are three ways that you can do that. Number one, look into auto pay. With
01:59auto pay, because the provider knows that you'll be paying them on time every month,
02:03they can reduce the rate that you pay. And on average they can reduce it by about a
02:07quarter of a percentage point, which doesn't sound like a lot but can add up. The
02:12second thing I want you to do is call your loan provider and just ask if they'll
02:16reduce the rate. Sometimes if you've been making payments on time and have a
02:21good track record, they will reduce the rate for you. And third, there are any
02:26number of startups out there right now that will refinance those loans. Again, you
02:30have to have good credit, you have to be making your payments on time. But if you've
02:34been doing that, there is the potential and opportunity that you can have your rates
02:38substantially reduced through some of these startups.
