Student loan debt pay or invest?

quote:

---

What would the cutoff interest rate be for paying the loan out over time vs knocking it out early?

---

I'd put the numbers in a spreadsheet. Ordinarily I'd agree that 7% is a pretty damn good after-tax return, especially considering that it's a guaranteed return.

OTOH if you don't have long to pay it all off it might be better to get started on your tax-deferred investment accounts now since you'll be earning interest presumably for your entire working life.

I'd certainly put some into a Roth anyway simply because you have to start building up a stash for a rainy-day fund regardless.

On a similar note, how much do you feel should you have liquid in tappable equity/investments before pouring all you have extra into debt?

I only have about $5,000 in student loan, but my advisor still has me pumping $200 a month to loans and $200 to my Roth. Since the interest is taxed off anyway, I just spilt the difference.