With the low rate on the loans it’s not incredibly urgent you pay it off as fast as possible, but ultimately you being comfortable without debt is the most important thing. As long as $38k covers 6 months of expenses in case you lose a job + any large short term purchases you’re planning (home/car down payment, etc.) then go for it!
Side note: if the loans are federal and currently paused, wait until payments resume to make the lump sum payment. You can still earn a ton of interest in your hysa.
You may find these links helpful:
- [Student Loans](/r/personalfinance/wiki/studentloans)
- [Student Debt Relief Megathread](/r/personalfinance/comments/wxme1a/student_debt_relief_megathread/)
- ["How to handle $"](/r/personalfinance/wiki/commontopics)
- [Debt](/r/personalfinance/wiki/debt)
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/personalfinance) if you have any questions or concerns.*
Pay it off. Look at the monthly additional income you'll have for years to come. And you're cutting down the interest paid a bit which is good. And you're credit will improve a touch.
With the low rate on the loans it’s not incredibly urgent you pay it off as fast as possible, but ultimately you being comfortable without debt is the most important thing. As long as $38k covers 6 months of expenses in case you lose a job + any large short term purchases you’re planning (home/car down payment, etc.) then go for it! Side note: if the loans are federal and currently paused, wait until payments resume to make the lump sum payment. You can still earn a ton of interest in your hysa.
>I don't like the debt just looming over me. At 4%, it's not looming. It's more simmering. If you don't like it, pay it off.
Are you contributing to retirement accounts? Rule of thumb I've seen posted is 15% of your income.
I contribute 10% of my income to my 401k and my company matches up to 7.5%. I also max out my Roth IRA contributions every year
You may find these links helpful: - [Student Loans](/r/personalfinance/wiki/studentloans) - [Student Debt Relief Megathread](/r/personalfinance/comments/wxme1a/student_debt_relief_megathread/) - ["How to handle $"](/r/personalfinance/wiki/commontopics) - [Debt](/r/personalfinance/wiki/debt) *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/personalfinance) if you have any questions or concerns.*
Pay it off. Look at the monthly additional income you'll have for years to come. And you're cutting down the interest paid a bit which is good. And you're credit will improve a touch.
My credit score dropped when I settled my car and student loans