Debt payoff priorities vs house savings?
edited to add clarifying info Hi all, I am currently 26. I just paid off my car, invest 5% of my income to retirement. I Have a separate pension that I pay into. I also have about 15k in an emergency fund. Ultimately I only have about 7-8k in my 457 b plan. I…
edited to add clarifying info Hi all, I am currently 26. I just paid off my car, invest 5% of my income to retirement. I Have a separate pension that I pay into. I also have about 15k in an emergency fund. Ultimately I only have about 7-8k in my 457 b plan. I have a Roth IRA that I’m hoping to max out the yearly contribution for this year. I feel like I’m in an okay spot in these areas (plan on increasing my retirement contributions yearly and promoting upwards to increase my contributions) but I have about 46k in federal student loans. I am likely to qualify for PSLF. I have been paying just over the minimum payment on my loans each month. Not sure if I should try and pay heavily into the loans or keep my current strategy. Any input or resources would be appreciated. I will qualify for PSLF in about 8 years. My interest rate is 5.5% currently. No other finance charges. My gross monthly income is about 7.5k but net amount after deductions, retirement, healthcare and pension is 4.5k. My expenses are about 3.5 a month (my partner and I share some expenses but not everything is currently joint. I make more so I tend to pay a bit more towards our shared expenses) I hope to one day buy a home but am uncertain if I’ll be able to with my heavy student loans. My next saving priority will be for a down payment on a home.
Collected discussion
How soon will you qualify for PSLF? What is the interest rate on your debt? I am a strong proponent for paying off debt and redirecting the payments to something with a return, but it depends on what you are paying in interest and finance charges and for how long. Some assessment if budget earnings versus expenses is needed as well.
I will qualify for PSLF in about 8 years. My interest rate is 5.5% currently. No other finance charges. My gross monthly income is about 7.5k but net amount after deductions, retirement, healthcare and pension is 4.5k. My expenses are about 3.5 a month (my partner and I share some expenses but not everything is currently joint. I make more so I tend to pay a bit more towards our shared expenses)