Jan 31, 2022 will mark the end of the last extension of the pause in student loan repayments. This includes interest collections and interest payments. Officials had stopped student loan repayments during the COVID-19 lockdown peak, when the economy was in a near standstill. Officials from the government educational loan agency stated that the extra time allowed borrowers to make plans for their repayments and reduced defaults following the restart of February 1, 2022.

Anybody with student debt will agree that student loan borrowers can become a headache. As the extended student loan hiatus comes to an end, CollegeFinance.com polled more than 1,000 student loan borrowers to analyze how they’re preparing to resume their payments. Surprisingly researchers were able to find some surprising connections between NFTs, repayment plans, and age groups. Highlights include:

• Nearly 45% of surveyed borrowers plan to invest in crypto or NFTs in preparation for payments to resume – Gen Z’ers were most likely to attempt this strategy
• Since the pause began, 18% of borrowers have been using the extra money they’ve pocketed to invest in crypto or NFTs
• Nearly one in 10 people plan to use NFT and crypto earnings to pay their bills when there is a pause.
• Unsurprisingly, just 10% of student loan borrowers knew the date that their payments would be resumed Feb 2022.

“Given the sharp uptick in crypto and NFTs over the past two years we expected to see some borrowers turn to them for what they hope can be a source of income, but nearly 1-in-5 doing so was surprising. Some might view this as spending money. However, it is a good idea to save for when the payments will resume. Some might view this as an opportunity to invest more to pay off their loans. This largely depends on the coins and NFTs they chose to invest in,”
Kevin Walker, the CEO of College Finance Company, wrote an email to DailyCoin.

He went on to note that a majority of respondents said they’re turning to crypto and NFTs for the risker – yet seemingly higher – rates of returns that hypothetically might be available to apply toward their student loan payments. Walker cited this risky strategy as the surprising result of his survey.

“The fact that over 50% of Gen Z borrowers plan to invest in crypto and NFTs in hopes that earnings can help pay for their student loans really surprised our team. While crypto continues to make headlines, it’s interesting to see that the younger generation is so eager and seemingly untroubled by the risk of a fairly new and volatile investment category,”
Walker declared.

Flipside

• Smart investment strategies can still be applied to cryptocurrency. Funds needed in the short term – such as paying back student loans in six weeks – should not be invested in highly volatile assets of any kind.

Why you should care

Although cryptocurrencies can be exciting, and offer long-term gains, they also have the potential to become volatile assets. Experts in financial advice will advise you not to invest more than you can afford. Also, it’s never a good idea to use borrowed money in any speculative investment.

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