Kill (Pay off) last student loan with savings?

[lootpacman]

Hi everyone,

I joined about 3 years ago and received some amazing on how to save, pay loans faster and invest.

I am close to paying off my student loans and this is where I could use your advice.

Here's my current situation, I have:

Student Loan = $5.95K @ 3.15%
Savings = $11.5K in 1% savings account
Credit cards = $1.1K @ 0% until Dec/Jan

• Filed my tax return and I should get back around $900 2-3 weeks from now.

• Have a wedding abroad to attend in April for 1 week, paid for flight on CC, housing should be free staying with a friend. Estimating spending maybe $500 during that week.

So should I use $6K and pay off my final student loan?

[corn18]

Hi everyone,

I joined about 3 years ago and received some amazing on how to save, pay loans faster and invest.

I am close to paying off my student loans and this is where I could use your advice.

Here's my current situation, I have:

Student Loan = $5.95K
Savings = $11.5K in 1% savings account
Credit cards = $1.1K @ 0% until Dec/Jan

• Filed my tax return and I should get back around $900 2-3 weeks from now.

• Have a wedding abroad to attend in April for 1 week, paid for flight on CC, housing should be free staying with a friend. Estimating spending maybe $500 during that week.

So should I use $6K and pay off my final student loan?

What's the interest rate on the student loan?

[Jluke]

What's the interest rate on the student loan?

also, what is the required monthly payment?

[disneysteve]

If you pay off the loan in a lump sum, you can then take the money that was going to the loan payment and direct it to rebuild the savings. You would still have about a $5,000 EF which is sufficient to cover most anything that would happen in the short term.

As usual, there is a third choice other than do it or don't do it. That would be to accelerate the loan payment but not pay it off all at once. Maybe that would be paying $1,000/month for 6 months. That still knocks it out pretty quickly and saves you on interest without the rapid depletion of your savings. That option might also be the one that lets you sleep better at night if that's a concern here.

In any case, yes, I would speed up the loan repayment. From what you've said, I don't see any reason why you shouldn't be paid off in no more than 6 months max.

Welcome back by the way.

[lootpacman]

What's the interest rate on the student loan?

It's 3.15%
Monthly payment is: $100

[lootpacman]

If you pay off the loan in a lump sum, you can then take the money that was going to the loan payment and direct it to rebuild the savings. You would still have about a $5,000 EF which is sufficient to cover most anything that would happen in the short term.

As usual, there is a third choice other than do it or don't do it. That would be to accelerate the loan payment but not pay it off all at once. Maybe that would be paying $1,000/month for 6 months. That still knocks it out pretty quickly and saves you on interest without the rapid depletion of your savings. That option might also be the one that lets you sleep better at night if that's a concern here.

In any case, yes, I would speed up the loan repayment. From what you've said, I don't see any reason why you shouldn't be paid off in no more than 6 months max.

Welcome back by the way.

Thanks, good to be back.

The third option also sounds like a good approach; paying it off in 6 months.

I wanted to pay it off before the option for a summer vacation with family or friends is on the table.

[Jluke]

It's 3.15%
Monthly payment is: $100

at $100/month, you won't recover those funds quickly.

I'd still do what DisneySteve said. come up with a plan to pay it off in a few months.

$1000 x 6 months
$2000 x 3 months

etc...

when you get your tax refund, add that to your monthly payment (1900 or 2900 or x+900).

be sure that the student loan company applies this to principal amount

[disneysteve]

I wanted to pay it off before the option for a summer vacation with family or friends is on the table.

What does that have to do with the issue?

Either you can afford a vacation or not. Whether or not you have a student loan doesn't really matter.

[lootpacman]

What does that have to do with the issue?

Either you can afford a vacation or not. Whether or not you have a student loan doesn't really matter.

Good point.

[lootpacman]

at $100/month, you won't recover those funds quickly.

I'd still do what DisneySteve said. come up with a plan to pay it off in a few months.

$1000 x 6 months
$2000 x 3 months

etc...

when you get your tax refund, add that to your monthly payment (1900 or 2900 or x+900).

be sure that the student loan company applies this to principal amount

Looks like a good approach. I think I may end paying $2000 per month for 3 months.

[Thrif-t]

Don't read the Want to Grow the US economy thread

[lootpacman]

Don't read the Want to Grow the US economy thread

Is that a thread on this forum? I can't tell if you are using sarcasm or not.

[james.hendrickson]

Is that a thread on this forum? I can't tell if you are using sarcasm or not.

Yes, its this thread:

https://www.savingadvice.com/forums/personal-finance-news-articles-blog-posts/86998-want-grow-us-economy-cancel-student-debt-new-report-shows.html

[lootpacman]

Yes, its this thread:

https://www.savingadvice.com/forums/...ort-shows.html

Thanks for the link!

[lootpacman]

Paid off student loans

Hi everyone,

Thanks for all the help on debt reduction. I've paid off all my student loans as of last Thursday.

I've checked my student loan history and I started with $32k and paid a total around $38K with interest included. One month from now, will make it 4 years since I've started paying those loans down.

Current Status:
Rent: $1050
CC Debt: $1.5K @ 0%
Investments:

• $27K in IRA

• $6.4K in Roth IRA,

• $6.5K in 401k (no match)

Savings: $7.9K @ 1.5% online savings
Age: 27 almost 28
Salary: $82K base (with bonus $90K before taxes)

Biggest dilemma is what my next goal should be?
- Save for house or investment property?
- Build bigger emergency fund?

I just recently got back from a vacation so that's out of the question.

Any ideas on how to proceed?