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  1. #1

    Pay Student Loans or Save for home

    I need advice on paying off my student loans. I turned 25 last year and a light bulb went off. I got a second job, built my emergency savings to $1,200, paid all of my miscellaneous debt (PayPal credit, QVC credit, dermatologist/medical bills), paid down my credit cards (2.5K), and made the final payment on my car today(7K).Now, aside from a line of credit that I took out for my boyfriend (He will have this paid off by mid March), the only debt I have is my student loans which total about 37K. My current plan is to build my savings to 10K by the end of August (1331/mo for 7 mo plus $500 this month) aside from my emergency fund then put ALL of my extra income toward my student loans (1331/mo plus 408/mo =1739/mo) and have there paid off in 2020. I am asking for help because my boyfriend’s parents feel I should focus on saving for a home which I could gain equity and feel I shouldn’t put so much money into my student loans. They are pretty well off and I highly value their opinion; however, I’m not sure if I whole heartedly agree with them on this. Below is a breakdown of my current state:

  2. #2
    Emergency fund $1,200
    Acorns investing account $100 and counting
    Roth 401K $13K (currently contribute 10% of my biweekly check)
    No other personal savings/investments however I pay my bills one month ahead which gives me a bit of leverage outside of my emergency fund

    Federal Student Loan Breakdown
    My monthly payment is $408/mo and I’m on a ten year repayment plan with about 9 and a half to go..
    $1434.70@ 6.8%
    $148.40@ 6.8%
    $7,559.46@ 4.66%
    $2,254.85@ 4.5%
    $1,471.28@ 4.5%
    5,716.01@ 3.86%
    4,793.86@ 3.86%
    1,075.15@ 3.86%
    3,637.57@ 3.4%
    2,906.48@ 3.4%
    Total: 36,712.71

    My boyfriend and I split rent, utilities, insurance, and food down the middle. We’ve been together since I was 15 (10 years) and I highly doubt a breakup will negatively impact my plan.

    Primary job 2400/mo after taxes (331 of this goes to savings/debt)
    2nd job 1000/mo after taxes (1000 goes to savings/debt)

    I know exactly how much I have available in extra income and that’s $1331/mo. My question is how to apply these extra funds. Should I stick to my current plan, build my 10K in additional savings, then aggressively pay off my student loans or should I listen to my boyfriend’s parents and focus on saving for a home which I can build equity in? I’d greatly appreciate any advice or critique of my current plan.

    Thank you,

  3. #3
    I was in your exact same position at age 25. Debt, family, career, all the same. I won't tell you what i did, but my current girlfriend at the time and now wife of 18 years agrees we suffered because we did things in the wrong order. In retrospect I strongly strongly recommend you separate your finances and live as an individual until you marry and combine your money. It changes your relationship and ensures a long healthy relationship. Also, do not be pressured by your future in-laws. Draw a line now or it will affect you your entire life. My wife and I gave in and bought a house. It caused lots of stress in our young relationship and marriage. It almost caused the end. And when we had fertility problems and were strapped with student loan debt and a house it delayed our family plans. So do what your heart tells you and use this time to aggressively pay off the debt. And date your boyfriend and act married after you are married. My wife and I wish we followed that advice.

  4. #4
    While reading your thread one of the first things that hit me was why YOU were signing for a line of credit for your boyfriend? Then when I read that his parents are well off, I really questioned it. Why didn't they sign for him? It dismays me when I see unmarried couples helping out the other one financially. Some of the threads here, young ladies are paying off their boyfriends cc bills to 'help him out' and get things taken care of before they get married. Sorry but that is doing things in reverse. Especially when the young lady is putting her own savings and retirement planning on hold while they help this guy pay off his bills. All I can see into the future for them is that when she has paid off his debt, he is gone leaving her with an empty bank account. These things do happen.

  5. #5
    What you do with your money is you business, not his parents business! Unless they are going to pay for your student loans which I highly doubt. You follow their lead in this, they will expect you to do it always. I can hear it now -- "Nope you shouldn't get pregnant yet" "You need a bigger house since you have a baby on the way" - "forget those student loans except the minimum as you need to buy a car for our son". I had a super interfering MIL (my FIL wasn't quite as bad) who felt that she could make comments about anything going on with our marriage. It was horrible. It wasn't her business what I made for supper, and if they didn't like what I was making, why didn't they encourage son to cook? They were on my back constantly to get a better paying job. When I finally did, the divorce came where the ex tried to grab everything, the house, the kids (he wanted the child support money not so much the kids) and I'm sure they felt that now that I was making more money the ex could be able to dip into that as well. Not saying this would/could/will happen to you, but it is none of their business how you spend your money. If you want to take that extra $1300/month and go for a long vacation in Hawaii without your boyfriend that is you decision, not his or theirs. At this point ALL your finances need to be completely separate from him and vice versa.



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