re: What do I do with my money next?

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Together we have $200,000 in student loan debt but our interest rate in 1.75%.

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How the bleep did you get 1.75%?

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Together we have $200,000 in student loan debt but our interest rate in 1.75%.

With the owning a house talk, do you mean paying the house off quickly? We are probably going to get a new house (selling the old) for a growing family.

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My thought is with a growing family and looking to move into a bigger house, paying off the old house and then saving up cash to buy a new house would be more of a priority than paying off the student loan debt at 1.75%. As low as housing loan rates are right now, they will be going up (eventually) so it'd make more sense to have cash in hand (either from the sale of your old house/good equity in your old house) or cold hard cash to put down on the new casa. Getting loans post crash/bailouts has been tougher and nothing makes it easier than having lots of cash and making the new housing loan as risk-free as possible.

That being said, you'd probably be better served to have a loan on the house than any other business loan. You should think about what debt you will potentially have in the future, how soon you may have that debt, and what interest rate that debt would be carried at. If you will be wanting to start a practice soon or another business, you'd be better served to use your cash for that and having a housing loan outstanding at lower interest rate than paying off the house and getting a 7% + business loan.

You have to think over the next 3-5 and 5-10 years what type of debt yuo'd potentially take on. After establishing an emergency fund/rainy day fund, if you have a ton of cash in CDs getting 0.5% interest and don't plan on using the cash for anything else (buying a house/starting a business), it is a better return to use the cash to pay off the student loans. If you'll need cash to start a practice (and loans would start at 7% or a house in the next year or two at 4-5%, the cash would be better served to not borrow at those rates/borrow less at those rates.

There are also financial calculators out there where you can input the term of the loan, interest rate, loan balance etc. so you can see how much you'd pay in interest over the term of the loan. You can play around with it and see how much money you'd save paying current loans down early and how much cash savings that'd save up for future projects. Those calculators will show yuo how much yuo will pay in total interest and total cash paid related to the loan.

I thought my 3.5% student loan was at a good rate. Sounds like yall are in a good spot to be successful financially for the long haul.

ETA: If you eventually go into practice and you and other doctors will all be signing on the loan or the loan will first be secured by the practice's assets, it'd be better to have the loan secured by the practice's assets primarily so you have less personal loss risk, even if it is at a higher rate. If you're looking at doing a solo practice or practice of just you and the wife, it makes more sense to go after the lower rate interest and avoid loans with higher interest rates.