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Strategy Question re: Old Student Loan Debt

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pdx_michael
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Strategy Question re: Old Student Loan Debt  Reply with quote  

Greetings,

Sad to say but I have been paying on a student loan for ten years and still have a balance of almost $50K; the interest rate is 9%. i just bought a house and have a mortgage with a 3.5% interest rate. No other significant debt. As a result of the sale/purchase I now have the cash to pay off the student loan. Should that be my first priority, or would it be be best to pay a big chunk of principal on my mortgage, or otherwise invest? I'm 47 years old.

Thanks, all, for any suggestions!
Post Thu Apr 11, 2013 5:00 am
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Wino
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This is a no-brainer. Pay off the student loan. It is not bankruptable, so you must pay it off. It can never be negotiated because it is guaranteed. You need to get rid of it as soon as you can.
Post Thu Apr 11, 2013 7:59 am
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oldguy
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Yeah, that!!!

quote:
or would it be be best to pay a big chunk of principal on my mortgage


And NEVER prepay a 3.5% longterm loan, instead apply your income stream to it's highest and best use. Eg, invest where you will earn 10% to 12% and keep that 3.5% loan forever.
Post Thu Apr 11, 2013 1:41 pm
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littleroc02us
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You don't need the government garnishing your wages should you lose your job and still have student loans. Be gone Sallie Mae or whatever!

Risk comes from not knowing what you're doing. (Warren Buffet)
Post Thu Apr 11, 2013 3:49 pm
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pdx_michael
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Thanks, everyone...  Reply with quote  

...for the input. Makes sense.
Post Fri Apr 12, 2013 3:15 am
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