Because of COVID I am in a position where I am able to pay off the current balance. Part of me wants the debt off the books so I don’t have to worry about it, but I know that the money could be put to work in the time being.
That being said, should I consider refinancing to and try to get a lower rate (for reference, I have two federal loans at 3.7% and 4.2%)?
Thanks all
I’ve always found if I can pay off a debt then I get it paid. More often the money slotted for other uses doesn’t entirely get used for that purpose and I’m still stuck with the debt.
for me some of it would depend on the size of the debt. My wifes interest rate on her loans was like 1% for life so we kept it for like 20 years. When the balance got to about 10K we just paid it off as we were trying to simplify our accounts.
At 3.7%/4.2% it is probably getting borderline worth it on a risk adjusted basis.
You can shoot for a risky 8% gain (stock market) or get a guaranteed 3.7/4.2 return.
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