Anonymous
Post 01/10/2017 00:54     Subject: Save for kids' college or pay off my own student loans?
Read about phaseouts- AKA penalties for earning money or living in high cola areas. Most are abrupt lines in the sand. Partial mortgage interest disallowance in phaseouts impacts high cola areas-high salaries over FIT legislated amounts.

Comically the govt legislated a marriage penalty for low income...

http://www.taxpolicycenter.org/briefing-book/how-do-phase-outs-tax-benefits-affect-taxpayers
Anonymous
Post 01/10/2017 00:40     Subject: Save for kids' college or pay off my own student loans?
Anonymous wrote:
Anonymous wrote:Pay off your debt, fund your retirement, then focus on college.


This


No, Fund your retirement, pay off your debt and then focus on college.
Anonymous
Post 01/10/2017 00:37     Subject: Save for kids' college or pay off my own student loans?
Anonymous wrote:Pay off your debt, fund your retirement, then focus on college.


This
Anonymous
Post 01/10/2017 00:20     Subject: Re:Save for kids' college or pay off my own student loans?
Anonymous wrote:Disclaimer: I like cheap debt. I follow my project management professor who says: if you are given the choice between holding the money or letting them hold the money always choose to hold the money. oh did I mention most DCUMers hate my advise?

How old are you OP. How long it will take you to pay your student loan with the minimum amount?

If you hate the debt, then fine pay it. but if your goal is to maximize your money then invest the $1000 providing:
1. Your student loan is paid before retirement
2. You have adequate emergency fund
3. Do not lock the extra $1000 on 529 on it is entirety (access is important in case you want to pay your student loan early )
4. Do not spend the extra $1000 because then you are paying interest on your student loan with no up side.

We have a mortgage, an investment property loan and a car loan that I do not intend to pay a day earlier than my contractual agreement. That allow us to max our 401K, Roth IRAs, 529 and have a life. Do not let DCUM bully you into something that is not you or what is best for you.


A car loan? How much liquid? Them holding the money v you holding the money depends on how much money [amts and % of total finances]. OP is either contribute to a 529 or pay down loans. Paid off loans are liberating.
Anonymous
Post 01/09/2017 17:20     Subject: Save for kids' college or pay off my own student loans?
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:OP here, thanks. I'm somewhat surprised by the comments given my low student loan interest rate. 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.

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.


If you keep punting paying off your college debt, it will take forever and be a psychological noose. Do you really want to still be paying it off when your children go to college?

I would put in the minimum $ into your children's 529s to get the tax deductions, then plow the rest into paying off your student debt. Then in 5-7 years when that is done, plow more into their college accounts. You do not mention retirement, so I am assuming you already have that covered.


Sorry for the delayed response. I don't have a psychological problem with debt. I would be happy dying with my student loan debt not paid off, in which case it will be forgiven.


You really want to be paying on student loan debt during retirement? Also, the discharge upon death depends on the loan (not all have it) and the laws of your state (your estate may have to pay, coming out of what would otherwise go to your spouse).
Anonymous
Post 01/09/2017 17:02     Subject: Re:Save for kids' college or pay off my own student loans?
Pay off your student loans! Your kids can take out their own student loans one day.
Anonymous
Post 01/09/2017 16:47     Subject: Save for kids' college or pay off my own student loans?
Anonymous wrote:
Anonymous wrote:OP here, thanks. I'm somewhat surprised by the comments given my low student loan interest rate. 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.

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.


If you keep punting paying off your college debt, it will take forever and be a psychological noose. Do you really want to still be paying it off when your children go to college?

I would put in the minimum $ into your children's 529s to get the tax deductions, then plow the rest into paying off your student debt. Then in 5-7 years when that is done, plow more into their college accounts. You do not mention retirement, so I am assuming you already have that covered.


Sorry for the delayed response. I don't have a psychological problem with debt. I would be happy dying with my student loan debt not paid off, in which case it will be forgiven.