Student loans or Investing?

Question

Due to the recent world economic events, the interest rate of my student loans are as low as they’ve ever been. One currently sits at 2.45% while the other is at 0% until 10/31 (then goes to 2.45%). I’m currently paying 6-7k monthly to take advantage of this, but I was wondering if it’s worth paying it off so quickly? Would it be a good idea to pay the minimum balance and invest the difference toward properties and the stock market?

Micah Sweeney · Answer

Mathematically if you can make a greater return than that 3% then you should pay the minimum on the loans and invest the extra cash, which will enable you to keep the difference between the interest on your investments and the interest on the loans. Since the stock market is generally 7%+ over time and RE can be multiples more, invest invest invest.

Kiera Underwood · Answer

@Pascal Wollach I house hacked before paying off my loans so that I could have lower cost of living as I was paying. I'm not sure if it's an option in your market, but if so it's worked out well for me!

Jenni Ellis · Answer

I would definitely invest that money in real estate. If you are able to get a great investment property, chances are the money you make on that deal, could pay your student loans for you. I am a firm believer of leveraging other peoples money!