Wiser Use of Money: Pay Off Student Loans / Invest

[claudenm]

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Ha, I have been thinking about this alot recently, although it is more of a theoretical fantasy, as I don't have the money to pay it off (broke and talentless FTW!)

I pay $200/month on my 15k loan @2.875%, what are all of your thoughts about increasing it another $100 vs. saving that $100? That may be a bit trivial, but thanks in advance for your thoughts.

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Why, why, why, oh why would anyone even consider paying off a 2.875% loan or paying it faster than the minimum? Considering the rate of inflation is higher than that, and you can get a higher ROR on almost any CD, there is no way you should ever pay this off. Pay any other debt first. Save for a house, as this will reduce your mortgage by giving you a higher down payment. Buy CDs. Play higher stakes. Just about anything other than putting it all on red or buying a scratcher ticket.

FWIW, I am able to get grad stuedent loans that after graduation will convert to 0.75% per year. I will take every penny I can get and pay it off as slow as they allow. When someone hands you practically free money, you definitely take it.

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For one, I don't like having debt. My student loan is my only debt. For two, it is free money in a sense, but it's money I've already spent. It's not like I can take that money and arb it with a savings account, it's money that has already been spent. Perhaps it is just a purely psychological thing that I would prefer not to have any outstanding debt?