Pay Off My Student Loans In Full or Make Monthly Payments?

[whitecat5000]

I have the ability to pay off my student loans completely now and be done with it. It would almost completely wipe out my savings, but I would be debt free. Also I would save about $8,000 in the 20 years if I paid it off in full now. Just asking for feedback.

I hear three main theories from friends/family.

1. Keep paying the loans as is because it will show a good credit history, and it's very important to have savings in the bank.

2. Pay them off because you never know what will happen in the future and no debt is good debt.

3. Pay off extra each month. That way there's credit history and also savings on interest and in the bank.

The hospital I work for does not offer loan repayment contracts. So that option is out. And I'm financially lucky enough where I don't qualify for almost all loan forgiveness/help from third parties. What do you all think? Any feedback?

[evolvingrn, BSN, RN]

The beauty of nursing is there is flexibility with our salary.....at least where i have worked i can almost always pick up extra.... .and if not agency jobs are just a call way. with that in mind i wiped out our savings to pay off my college loans in a year (30 thousand plus) sooo worth it. For my next degree i hope to take out minimal debt. That is just my preference though.

[morte, LPN, LVN]

make sure any extra you are paying, is actually going to principal, and not simply paying ahead on the next installment due.

[aachavez]

some loans qualify for forgiveness after 10 years for public service workers, check into that and see if it changes your situation any.

I vote for option 3 as well, don't totally deplete your savings, but pay your debts faster.

[Jory, MSN, APRN, CNM]

I'll tell you what a financial advisor will tell you:

PAY THEM OFF

Rationale: Let's say, your student loans were at 5% interest?

Do you know of a bank that will pay you 5% interest in a savings account?

I don't either.

Then, after you pay them off, TAKE THE MONEY that you would have otherwise used for your student loan payment and REBUILD your savings.

Never, ever carry debt if you don't have to.

[Race Mom, ASN, RN]

Pick up (or loan from the library) Dave Ramsay's book, Financial Peace. You will have a clear mind after reading it. Very simple process. So simple...most don't even think to do it! The borrower is slave to the lender.