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[quote=Anonymous][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]

It's not a psychological benefit. It's a real benefit.

What is very likely to happen is OP will move onto get some credit card debt, then a mortgage, in between will be marriage, a kid or two and possibly the student loan debt of the spouse then throw in that monthly student loan payment, you end up sucking away money towards that loan that could have went to things for your family.

Pay the student loan off now.  You have many, many years to accumulate even more debt and you will.  [/quote]

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