I am a pediatrician and am moving to a new practice. At my previous practice I had 401k with matching. I also max out a backdoor Roth IRA every year. I will have 401k with matching at my new practice after 1 year. I also have 185k in federal student loan debt. I have been throwing $2000-$3000 a month at the loan with the highest interest rate (6.84%) during the SAVE limbo.
I will have more take home pay since there won't be any 401k contributions until next year. The question is should I open a brokerage account and invest the difference or should I put it towards the student loan debt. I will pay off the loan with the 6.84% and 6.8% interest and start paying on the loan with the 6.21% Internet rate during this year period either way.
I have no other debt other than a mortgage. I am planning to switch to a graduated extended plan if/when forced off SAVE to lower the required monthly payment as much as possible so I can put more money towards the highest interest rate loans.
Leaning towards putting any extra take home pay towards my loans, but wanted to see what others think.
Investing vs. Debt Pay off
byu/PassExternal6409 inpersonalfinance
Posted by PassExternal6409
1 Comment
I would pay off the loans rather than invest—those interest rates are too high for you to be able to count on beating them with investment earnings.
However, if you don’t have a pretty significant emergency fund, I’d do that first.