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I am trying to decide whether to pay off my student loan early. I am getting impatient and just want it gone.
My boyfriend and I live together and have very little debt. He has about $1500 on a credit card that he is taking care of and I have $4900 on my student loan. We could easily run our household for about $2500/month. I have $10,000 in cash in savings accounts right now. He has no savings (we both got divorced and moved across the country recently so we're working on rebuilding the savings account).
We both work good jobs with respectable salaries and good health insurance. My minimum loan payment is $140/month and I have a 4.13% interest rate. I can save an additional $400/month. I save plenty for retirement and all of that. So, I have the liquidity to just pay the stupid thing off today if I wanted to, but then I would only be left $5000 in cash for an emergency. That makes me kind of nervous. I mean, it shouldn't be a problem. I would rebuild my savings with what I had been directing towards the loan. But, if we were both to simultaneously lose our jobs, we'd be struggling, especially since we'd have to pay for COBRA and I have a chronic health condition (while not fatal, it could easily prevent me from working if untreated and it's really expensive to treat without health insurance).
So, I don't know. Should I just pay off the loan and be done with it and trust that $5000 in the bank will be enough of an emergency fund until I get it rebuilt? I suppose both of us could lose our jobs at the same time, but it would be more likely that it would just be one of us.
Thanks for any feedback.
My boyfriend and I live together and have very little debt. He has about $1500 on a credit card that he is taking care of and I have $4900 on my student loan. We could easily run our household for about $2500/month. I have $10,000 in cash in savings accounts right now. He has no savings (we both got divorced and moved across the country recently so we're working on rebuilding the savings account).
We both work good jobs with respectable salaries and good health insurance. My minimum loan payment is $140/month and I have a 4.13% interest rate. I can save an additional $400/month. I save plenty for retirement and all of that. So, I have the liquidity to just pay the stupid thing off today if I wanted to, but then I would only be left $5000 in cash for an emergency. That makes me kind of nervous. I mean, it shouldn't be a problem. I would rebuild my savings with what I had been directing towards the loan. But, if we were both to simultaneously lose our jobs, we'd be struggling, especially since we'd have to pay for COBRA and I have a chronic health condition (while not fatal, it could easily prevent me from working if untreated and it's really expensive to treat without health insurance).
So, I don't know. Should I just pay off the loan and be done with it and trust that $5000 in the bank will be enough of an emergency fund until I get it rebuilt? I suppose both of us could lose our jobs at the same time, but it would be more likely that it would just be one of us.
Thanks for any feedback.
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