If you have student loan debt, are you planning to pay it off early? Or are you simply making the minimum payments because you’re comfortable with the low interest rate, tax deduction, and low payments?
For the longest time, I’ve been in the second camp, happy to pay off my student loan debt using the minimums, knowing I had other financial goals that took precedence.
Well, that time has come and gone. With the down payment of our house complete, repayment of our high-interest auto loans, and money saved up for our first baby, the only big financial hurdle Mrs. PT and I currently face is the repayment of our student loans. And we’ve already taken action…
Last month we paid off one of our loans with one big chunk payment. Most of the funds came from our most recent ESPP flip (forced extra savings using company stock). And by the end of the summer, we should be able to wipe out the last student loan.
Overall I’m definitely proud to be able to close out this debt, but I do have mixed feelings whether this is the best move financially. With cheap stocks, real-estate, and other investments on sale right now, I wonder if this money could have been better served elsewhere.
But I won’t be wondering long, as there are huge benefits to having this debt behind us: more money available for savings, more flexibility in our budget, one less payment to worry about, etc. Not to mention, student loan debt is the debt that would never be forgiven, even in bankruptcy. Lastly, it just feels good to be rid of it.
How about you? What did you do, or what are you planning on doing with your student loan debt?