Our financial story – student loans – part 1
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I thought that student loans would be a good place to start documenting our financial journey – as I am bringing my graduate school career to a close, I thought it would be a good idea to take a look back at what our education cost us.
Today, I will start with my husband’s student loans. Starting off, he had federal undergraduate student loans totaling roughly $18400 (these days, that’s not bad for 4 years at a private college!) which he began paying in September of 2000. In September of 2002, he went to an accredited school for massage therapy, and took out another federal loan for $5800 to help cover the tuition. In August of 2003, at the advice of a friend, we consolidated his undergraduate student loans (which had gone from $18400 to $13000) with his loan from massage school. We owe this friend a big thanks, as we locked in a 3.5% interest rate.
We currently owe $10488 on this account. Our minimum monthly payment is $176 (on the standard repayment plan), and we used to make $200 payments. We are currently making the minimum payment so that we can use the extra money for higher interest rate debts, and have 67 payments left to make. Other than the mortgage and a credit card that we use for monthly expenses and then pay in full each month, this is the only debt that my husband carries in his name.
I often think about whether or not to continue to pay down this debt. I know that we may be able to defer payments (while interest accumulates) or take a different repayment plan with lower monthly payments, but we don’t want to be sending our child off to college and still be paying our own loans. Also, there is the psychological aspect of having this debt paid off. On the other hand, the money we are using to pay off this debt could be doing more for us, even in something as safe as a high-interest checking account. Decisions, decisions…
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