Reply to Save for kids' college or pay off my own student loans?

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]OP here, thanks.  I'm somewhat surprised by the comments given my low student loan interest rate.[b]  All the calculators I've seen say that it makes more sense to invest rather than pay off a loan with such a low rate[/b].

I also have a $300k mortgage at 3.5%.  Should I focus on paying off that debt after I pay off my loans, especially if the mortgage interest deduction goes away?

And I drive a 20-year-old car, and DH drives a 10 year old car.  I have a $50 Android phone and use Virgin wireless.  [/quote]

But have you been investing as opposed to paying down the student loans?  Most people seem to have this excuse (the rate is so low!) but it's not like they instead are investing the money.  They usually are spending it.  If you've been building up a private investment account then that's great!!

[/quote]
I've been investing in a 401(k) ever since I started working.  I saved up to buy a house that has appreciated approximately 6% per year (plus I just needed a place to live with the kids).  I paid off about $80k in other student loans too.   So the answer is yes, I've either been investing or paying off loans.

But the question I originally posed asks what makes more sense -- to invest for my kids in a 529 (that would hopefully grow 6%+ per year, assuming the markets don't tank), or pay off a 2.75% student loan that I hold.  I'm not asking whether it makes sense for me to go out and buy a new car instead of pay off my student loans.[/quote]

I'd say you need to cut back and do both.  Payoff your loans and also invest in your kid's college.  Unfortunately, you need to prioritize your loans.  You can't borrow for your retirement but your kids can borrow for college.  [/quote]

Thank you.  That makes sense.  DH told me that saving for our kids should be our last priority, and seems he's right.  We'll continue to chip away at the loans.  DH is getting a big bonus this year (big for us) so we should be able to knock off a lot.[/quote]

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