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Subject:  Re: Student loan scenario Date:  11/12/2012  2:40 AM
Author:  kahunacfa Number:  306411 of 308367


I would like to hear opinions on whether I should pay off a $13k student loan with a recent received inheritance or pay it off over time. The loan has a 6.8% interest rate. I am currently working with a comfortable income and have no problem making payments.Thanks for your input.
- Flashg213 | Date: 11/10/2012 8:29:00 PM | Number: 306410

It is quite likely, since this is the Credit Card/Debt board that you have other debt with a higher interest rate than your 6.8% Student Loan debt. Either pay that off first or take the inheritance you received and invest it in a IRA that will earn returns tax-deferred for your own Future inheritance or those of your dependents.

It is actually quite easy to find investments that will earn more than a 6.8% rate of return. Some Quality Utility companies as well as Master Limited Partnerships and Pipeline Companies have dividend yields that exceed 6.8%.

Kahuna, CFA
Investment Professional
1974 - Present
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