Hello friends,

I have four private student loans including:

$14,600 @ 5.25% min payment $100 (20yr), starting April 14
$5,500 @ 4.00% min payment $40 (20yr), starting Dec 14
$31,600 @ 3.75% min payment $278 (12yr), starting Aug 7
$14,000 @ 2.75% min payment $77 (20yr), starting April 14

I make $54,000 a yr and if I live frugally here is my monthly budget:


net bi-weekly income: 2984.58

expenses

rent 550
loans 490 (min)
grocery 400
utilities 100
phone 80
auto insurance 100
I Pass 20
gym 30
gas 100
going out 0
eating out 0

remainder = $1112.58

which means if I never eat out and never go out I'd have $1110 extra each month, which more realistically is something like a remainder of $800, bc I'm 24 and live near dt Chicago and am working my first full-time position.


Eventually, when I can get the match in August, I'll be contributing $250 of my salary each month to utilize the max 401k match, so in 6months from now this number will be $250 less each month (traded for a 3% 401k contribution). Also, I'll probably get something like a 5% raise in August, so the lose will be almost equalized.

Finallyyyy now to my question. What do I do with this leftover $$$ each month? I know to start attacking the loans from the highest interest rate down, from the 5.25% then on the the 4% and so on, until they are gone. But, with such low interest rates, is that truly the most optimal thing to do with your $$?? Are there investments that can beat the low rates? Particularly once the only remaining low is 2.75%, surely there are better things that I can be doing with my $$ than quickly paying off the 2.75% loan. The longer I draw it out the more inflation helps me anyway. But, the never ending fear is that these rates will not stay this low forever, especially now that the economy is bouncing back, they will rise. The 2.75% could easily turn higher than the 5.25% loan or worse.

Let me know what all you smart people think. Thanks!