Pay off student loan or invest?
Discussion
Okay, I know there's a ton of variables/considerations/attitudes in play here but I'm curious to know what PHers would do.
Son has £50k outstanding and is paying around £150 a month out of his wages. From what I can make out, the £150 seems to be £10 going towards the principal and £140 in interest. Seems mad to me but there you go.
He's in a reasonably secure job and is likely to be able to pay off the loan at some point in the future, in other words it's unlikely to be written off.
He could pay off a chunk of it or he could invest the money in an S&P 500 fund.
What would you do?
Son has £50k outstanding and is paying around £150 a month out of his wages. From what I can make out, the £150 seems to be £10 going towards the principal and £140 in interest. Seems mad to me but there you go.
He's in a reasonably secure job and is likely to be able to pay off the loan at some point in the future, in other words it's unlikely to be written off.
He could pay off a chunk of it or he could invest the money in an S&P 500 fund.
What would you do?
Edited by clive_candy on Sunday 16th August 18:39
Martin Lewis amongst others have done plenty on this, so worth googling their input.
From memory though, I think typically it's if a very high earner and you'll likely pay it all back before the cutoff date, overpay to avoid the interest.
Don't think it'll be cleared before the cutoff date and the debt dies, **** them.
From memory though, I think typically it's if a very high earner and you'll likely pay it all back before the cutoff date, overpay to avoid the interest.
Don't think it'll be cleared before the cutoff date and the debt dies, **** them.
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