Friday, August 21, 2015

Should I save/invest or pay down mortgage or student loans with new extra income?


I am a 32 year old woman, single, no kids yet and with a decent career. I have a house with a mortgage in which I owe about $76,000 for 28 more years at 4.25% interest. I also have about $76,000 in student loans at 6.5% interest. I recently got a new job and will be making about $52,000 a year. I have no credit card debt and a $4000 loan for car with no interest. I have only $3000 in emergency savings and no investments or retirement to speak of. I am doing the Public Service Loan Forgiveness Program so I pay based on my income for 10 years and I am 3 years into it. So in 7 years if all goes as planned they will forgive the rest of my student loans.

Now that I have a new job I have some extra money at the end of the month. Should I worry about paying down the student loans? Pay off my mortgage early? Save extra income and invest it? Roth IRA maybe? Anything else I'm forgetting?

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