I am staring my financial journey and am looking at the best place to put my extra income. I make 90k a year. My current savings and loans are:
Savings:
- 12k emergency fund (in traditional and want to move to HYSE but don’t know about hidden costs)
- 10k in savings (want to get to 30k) for an eventual house down payment (would like to increase but don’t know if in the meantime to keep this in a HYSE or a brokerage account)
Loans:
- 28k personal student loan @ 4.49%
-50k parent plus student loan in parents name that I agreed to pay back @ 6.85%
My main question is I see a lot of people on this forum talk about paying off the loans if they are higher than the rate of return on investment.
However how does that work with a loan that is in someone else’s name that you are paying off? I know logically that the 6.85% should probably be what I focus on but seeing as this is a loan that wouldn’t be transferred if the worst was to happen to my family should I prioritize knocking out my own loans in my name or investing in brokerage/401k accounts? Or should I treat it as if it’s something that is in my name since I’m the one paying it back and attack that since I feel like it would be hard to find a return better than 6.85%. Also should I forget about saving for a house for the time being and use that money to more aggressively attack the student loans.
Any advice is helpful! Thanks in Advance!
Savings:
- 12k emergency fund (in traditional and want to move to HYSE but don’t know about hidden costs)
- 10k in savings (want to get to 30k) for an eventual house down payment (would like to increase but don’t know if in the meantime to keep this in a HYSE or a brokerage account)
Loans:
- 28k personal student loan @ 4.49%
-50k parent plus student loan in parents name that I agreed to pay back @ 6.85%
My main question is I see a lot of people on this forum talk about paying off the loans if they are higher than the rate of return on investment.
However how does that work with a loan that is in someone else’s name that you are paying off? I know logically that the 6.85% should probably be what I focus on but seeing as this is a loan that wouldn’t be transferred if the worst was to happen to my family should I prioritize knocking out my own loans in my name or investing in brokerage/401k accounts? Or should I treat it as if it’s something that is in my name since I’m the one paying it back and attack that since I feel like it would be hard to find a return better than 6.85%. Also should I forget about saving for a house for the time being and use that money to more aggressively attack the student loans.
Any advice is helpful! Thanks in Advance!
Statistics: Posted by PurdueGrad23 — Tue Apr 02, 2024 11:12 am — Replies 1 — Views 131
