Debt

I read somewhere recently that when the most recent judge was sworn into to Supreme Court, he was still making payments on his student loan.

If the only debt you have is your student loan, and you have enough money in savings to cover your emergency fund, and you are already contributing the max to your company's 401(k), then it's ok to pay it off early.

But, if you're not saving at all for the future, then it would have been better to put money into an acct getting better interest than what you're paying.  ING has 4.5 going right now.  (Shoot me a PM if you want an 'invite'... )

Unfortanately, most people (myself included) are carrying more debt than just their student loans, and most of that debt is at a significantly highter interest rate than any savings acct can give them, so it would make better sense to pay that off as quickly as possible (without sacrificing the emergency fund).

I have my various debts ranked in order of importance, and I'm paying them down as aggressively as I can, while still contributing to my 401(k) and banking some for emergencies.  My ultimate goal is to be debt free by Dec 31, 2008.  We'll see how that goes.
 

Same boat here but a little behind you.  We're paying off moving debts and still trying to catch up to Katrina debts.  Once that's done and the emergency fund is filled up and 401k contributed to, we'll have to decide what to do with the rest.  In your mind it's easy to say that X investment generally returns Y% and should be where your money goes, but it's hard to look at that student loan number and not want that gone.  Same with the mortgage.

We don't always do what makes sense though. 

I don't personally buy into Dave Ramsey's philosophy 100%, but his general financial advise is pretty solid.  Here are his basic recommendations.

http://www.daveramsey.com/etc/cms/index.cfm?intContentID=4123

If you can earn more than the interest on your student loan in investment, then your overall wealth throuh your lifetime is decreased if you pay back the loan.  Student loans are the cheapest loans out there.  If you invested very conservatively in a mutual fund or real estate, and gained only 4% per year, you still would make more money than paying off the loan. If you want to pay off your student loan earlier, invest in something that gains 8%, don't touch it, then take the profits from that and pay off your student loan.  Even with capital gains tax you would pay it off sooner.

  If the interest on the loan is more than you can earn by investing it (like credit card debt) it makes sense to pay it off.  At 18% interest, you aint gonna make that kinda money investing.

I have sizable student loans, but even in 3 years of attending salary and modest investments, I could pay off about half the student loan now if it were in my best financial interest.

I Hate my student loans too but in reality they are "good debt"  I would LOVE to pay them off but as other have stated with the interest on them so low it is better to invest the money and pay them off over time.  I totally feel you pain about having it hanging over your head.  At least you didn' have to buy into a practice.  Me, I'm deeper in debt than you can possibly imagine. 

Wish you well in that goal. 

Fingers crossed. When I sell my house, I'll be there! 

It's been years since I've had consumer debt such as a running credit card balance.  Student loans don't bother me, nor does a mortgage.