Is it true that some* debt is good debt. I’m referring to student loans, interest is ranging from 2% - 5% (all federal loans). Total is 20k, is it smarter to pay it off immediately and ASAP or just stretch and put the extra money into investing? Note I just graduated this year, thank you guys :)

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As a first generation college graduate & someone who helped support her parents & supported herself since a very young age, i am not comfortable with any debt. I paid off my car and student loans asap, despite their low interest rates. It helped me sleep better at night and then i was able to comfortably save for a house down payment & retirement etc without those budget line items.

likesmarthelpful

This has its place too. There’s something to be said for the ability to lean down and leave on a shoestring budget with no debt as well.

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There's a small chance the Biden Administration does some sort of loan forgiveness for fed loans. I'd wait a few months and see how it plays out, even if it's unlikely.

likesmarthelpful

I wouldn’t say it’s “good debt,” but if the interest rate is in the 2%-3% range, you can likely put your money to better use by investing instead of paying off the loan. At 5% it’s probably up to you and what kind of return you can get on your money.

likesmart

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