June 2016 - Getting Out of Debt Q&A

Millions of hard working Americans experience financial hardship and stress—and poor credit options exacerbate the problem. By the numbers, the Center for Financial Service Innovation (CFSI) estimates that high-quality credit is not an option for 108 million Americans who lack access to credit cards or low-interest financing products.

What’s scarier is that many of the people who don’t have access to sound credit options are working full-time jobs and doing everything they can to make ends meet. If this is familiar to you, a family member, friend or colleague, Zebit is a new socially-responsible company that may help.

Zebit, a company committed to offering no-cost, transparent credit to hardworking Americans, has just announced a new partnership with CARD.com— the largest online originator of Visa and MasterCard debit banking accounts—to provide a more complete suite of services, including access to $1,000 interest-free financing to select CARD.com members.

Zebit gives members the ability to pay for purchases over time in equal installments at 0% APR, without a credit check. With the offering, Zebit seeks to turn the tables on unfair lending practices and level the playing field for Americans that have been turned away or charged exorbitant fees by traditional lending and credit services. CARD.com members will also be able to leverage Zebit’s free financial wellness resources that feature budgeting tools, online education, and the Instant Budget mobile app.

How exactly does Zebit work? CARD.com customers who are at least 18 years old and have been using the direct deposit feature on their CARD.com debit card for at least 6 months are eligible to register for Zebit.

Upon registration, these members will be able to finance purchases up to $1,000 from the Zebit Market, a proprietary e-commerce site stocked with more than 20,000 name brand products at competitive retail prices—it has everything from electronics and furniture to appliances, luxury items, exercise equipment and more. Purchases can be financed and paid over six months, interest-free.

There are many student loan myths floating around out there, such as the idea that student loans should only be used to pay for your tuition. Unless you make a lot of money outside of school or your private university comes with a massive annual tuition bill, you’ll likely qualify for more student loan assistance than you need for tuition alone. Is it alright to use student loans for living expenses?

When is it alright to use student loans for living expenses? What expenses should you use your student loans for? You certainly do not have to take out the full amount offered in your financial aid package, but you also don’t have to restrict yourself to only using student loans to cover tuition.

When To Use Student Loans For Living Expenses

If you’re debating whether or not to use some of your student loans for non-tuition expenses during undergraduate or graduate studies, here are some dos and don’ts you should follow when using student loans for living expenses.

Should you use student loans for living expenses? Here are a five times when you might have to.Click To Tweet

Academic Expenses

There are multiple tax benefits for education offered by the IRS, including tuition payments (whether paid for with your own money or with the help of student loans) and other qualified academic expenses. For example, the tuition and fees deduction allows you to deduct up to $4,000 per year on your income taxes, which justifies the student loan expense.

You can also later deduct up to $2,500 per year in student loan interest payments if you borrowed them for qualified educational expenses (tuition and fees, room and board, books, supplies, equipment, and other necessary expenses for higher education, including graduate school). So, instead of avoiding student loans at all costs, you can embrace their assistance in short-term help with academic expenses and get some relief in the long-term payoff with student loan interest deductions.

Paying Rent with Student Loans

If you have access to another form of income during your studies, it’s best to pay for rent with that income instead of relying on student loans to cover your living expenses. Some folks may not have that option, however.

Unless you manage to live rent-free – with your parents or relatives, working as a residential advisor, etc. – paying rent is an unavoidable expense. If there are any ways you can minimize your living expenses while living on your own, then this will subsequently decrease the amount of student loans you need to take out for non-tuition expenses. You should consider comparing rental prices in the area, commuting from a city with a lower cost of living, getting a studio instead of single bedroom, or other cost saving measures to help you from using student loans for living expenses.

Zebit Levels Playing Field for Working Americans with CARD.com Partnership

Five Times To Use Your Student Loans For Living Expenses

When To Use Student Loans For Living Expenses

Academic Expenses

Paying Rent with Student Loans