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Is it worth paying off my plan 2 student loan loan with some of my mortgage overpayment?
Have 15k saved, was going to pay off some of my mortgage but now thinking is it wise to pay of my plan 2 loan?
I owe 10k, earn around 50k and have ended up paying the maximum interest every year for the last 2/3.
I am thinking the extra 170 a month would come in handy and the mortgage interest rate of 3% is going to be much cheaper than 7.2%!
Or is it wise to carry on as is and let PAYE take care of it over the next 5/7 years. Thoughts....
I owe 10k, earn around 50k and have ended up paying the maximum interest every year for the last 2/3.
I am thinking the extra 170 a month would come in handy and the mortgage interest rate of 3% is going to be much cheaper than 7.2%!
Or is it wise to carry on as is and let PAYE take care of it over the next 5/7 years. Thoughts....
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Comments
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Without knowing exact figures it's impossible to say and even then it's not black and white..
It is possible to never pay it off entirely but pay more back by letting it run it's course when compared with paying off the whole lump now. The downside to paying off in a lump sum is that you need a lump sum to do so and don't have the benefit of using the lump sum for something else.
Only you know your future earnings potential and how long to go before the student loan is written off. Do the maths and work out which option is beneficial to you.
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