General financials:

I can afford to pay them off in full and have plenty left over for general life needs

The interest rates on them should be 4.53% according to their chart of when it was awarded.

If I do hold onto the money and pay off monthly I can put everything into a CD but I'll still be losing .03% if I lock in the student loan money maybe I'll beat but .07-.43% so not a ton of upside unless there's sudden political will to actually follow through on student loan forgiveness.

Is there anything else I'm missing when considering this? I am leaning towards just pay off as I've been planning for this, but I want to make sure there isn't something else to do.

  • bytor9@lemmy.ml
    ·
    edit-2
    1 year ago

    I think you're okay either way but personally if I have an emergency fund and no higher interest debt, I'm paying that off for sure. Even if I lost a couple bucks, worth it for peace of mind.

    Would be different if the debt was a mortgage at 3%, which many people do have right now.

    Edit: One note for folks doing similar math, don't forget interest and yield on bonds are taxed as ordinary income (20~30% in the US).

  • Ret2libsanity@infosec.pub
    ·
    1 year ago

    The government is never going to take responsibility for pushing predatory loans onto young kids. The last hope was the Biden forgiveness plan.

    Pay it off.

  • Maybe@lemm.ee
    ·
    1 year ago

    I don’t think there’s a bad decision.

    A CD isn’t the only option. A 2-year treasury note pays 4.82% right now. You could do that and then reevaluate in 2 years. Having more accessible/liquid assets leads to more flexibility if you need money for an emergency or even a move or downpayment or whatever.

    There’s also the very remote possibility for loan forgiveness.

    I don’t think the interest spread is large enough for that to be the “slam dunk” answer though. If you’re not great with money or just don’t want to deal with another administrative burden I’d lean towards just being done with the loans.

  • Chapo_is_Red [he/him]
    ·
    1 year ago

    Depends on whether sleepy Joe actually implemented the much more generous income based repayment plan

  • qwamqwamqwam@sh.itjust.works
    ·
    1 year ago

    The absolutely optimal move is probably to keep 5 or so k of debt around just to hedge the forgiveness play. But just paying it all off is also a great investment. You’re not likely to find another way of using your money with a >4% ROI. If the hassle of keeping another set of bills current is going to significantly add stress to your life I would pay it off. Really, though, there’s no way to lose here.

    • kakes@sh.itjust.works
      ·
      edit-2
      1 year ago

      The [S&P 500] index has returned a historic annualized average return of around 11.88% since its 1957 inception through the end of 2021.
      https://www.investopedia.com/ask/answers/042415/what-average-annual-return-sp-500.asp