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[quote=Anonymous]What interest rate do you pay for your student loans?  If it is low (3-4% range), I would keep the loans.  I know a lot of people will disagree with me, but I would keep the loans, keep the 20K as an emergency fund, and invest your monthly surplus.

I realize paying off the loans offers a psychological benefit about not having debt but I don't think it makes sense financially.  I would definitely open a roth IRA if your company doesn't offer a 401K and put as much into the Roth as you possibly can.

You should google a financial calculator and look at the compounding effect of the investment in a Roth.  If you put 4,000 a year into a Roth and say a conservative 7% return. If you're 21, you'll have 50 years of compounding.  Use the same formula, but let's say you decide to payoff student loans first and let's say it takes 15 years at 4,000/year to pay off.  Run the same calculation, but use 35 years of compounding and look at the difference.  Just my 2 cents.  Good luck to you![/quote]

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