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Low Interest Loan Repayment or CD/HY Savings (self.personalfinance)

submitted 10 months ago by Copernican to c/[email protected]

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Looking to pay off $15k of student loan debt of my partner. It's something we could wipe out with cash on hand if we wanted to relatively quickly. But one of the loans is 4.5%. Am I better off just riding that out but keeping the cash in for that loan in a HY savings account or keep reinvesting it in short term CD's that have a 5% return and to have more liquidity?

There's a part of me that used to really enjoy the piece of mind of being debt free when I paid off my student loans. But now that I'm more financially established and disciplined, I'm wondering if it's better to pay it off slowly.

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[–] [email protected] 6 points 10 months ago

You're correct that it would be better to pay it off slowly. Keep your money where it will make you the most money.

But like you said, there is value in the peace of mind of not having that hang over your head.