school loan!!!!

[thomasdan]

Helloooo everyone!!!!

If your'e a math wiz, Please help

My wife has a school loan that we're trying to pay off by the end of OCT 2013.

we have to options and dont know which is the best way to pay it off.

She currents still owes:10,285.68 with a 5.38 percent.

we currently are saving 2,400 a month. She makes a 112 dollar minimum payment to school loan.

if we save:

july-1,844*(not able to save as much this month)
august-4400 *( we both get an extra paycheck this month,So we can save 2000 more)
sept-2400
Oct- 2400

thats a total of 11,044.

would it make sense to save that money and have my wife contuine to make her 112 dollars and save 11,044. and by the end of OCT just make one huge final payment. which the payoff calculator said it was 10,503 becasue of the daily intrest for the next couple months.


OR


this is where i need someone to help with the math. I dont know how to calculate intrest or what not


should i make bigger payments at the end of each month. How much intrest would i really be saving.

so my payments at the end of each month would be this

july- 1844 + 112
august-4400 +112
sept-2400+ 112
october- 2400+ 112

i know when we add all this up.. its more than what my wife has to owe on her princple.. the left over would just go to another savings acount.What is the difference of savings from option 1 and option 2.

I hope this even makes sense. im even confuse. its all confusing to me. Please help

[disneysteve]

Unless you have some account where your savings is earning more than 5.38% which I highly doubt, you are better off paying the loan as the money comes in. Sitting on the cash and waiting makes no sense. It is just increasing the amount of interest you are paying.

[Goldy]

Sending payment as you get paid will save you more money by the time October rolls around. It also has the added benefit of not being in your bank account waiting to be spent on things. Make sure you have enough saved in an emergency fund to cover any unexpected bills in the mean time.

[snafu]

kudos to DW and you on setting your priority to paying off SL. As a point of caution...please have wife check with SL lender to verify the procedure and terminology they use so that any payment over the required amount [$112.] is applied immediately to the principal. The faster the principal is paid down, the lower the cost of interest.

[thomasdan]

thank you.

This is our last and final loan to finally be DEBT FREE!!!!

its been alot of sacrifice over the last year but it can be done.

This is our simple formula:

priorty over needs over wants.


Everyone here thats in the same boat. DONT LOSE FOCUS.

this is what we paid off in 1 year and half

wedding: 25000*(with no parental help)
consumer debt: 1500
court:1900
car: 3000
husband School loans: 24000
wife school: still working on it.

i bring home 47,000 and she brings home 60,000 before taxes.
its not the most. but it works if u make it work.

plus we have 2200 in monthly expenses

CHEERS