A few weeks ago, I was asked to speak about money to the teenaged girls in our church congregation. Thanks to all of you and your many good comments on this blog since January, I felt like I knew what kind of information would be most interesting and helpful to these girls who are just on the cusp of adulthood.
Here's what we discussed:
1. Getting a job and saving 50% of what you earn while in your teens. I also shared with them examples of impressive teenagers I've known through the years and the amounts of money they've been able to save in their bank accounts by the time they graduated from high school.
2. The cost of tuition at local and out-of-state colleges and universities. We even took a look at the cost of elite schools like Harvard and Stanford, just so they would know.
3. Typical salaries of standard jobs: surgeon, fire fighter, grocery store clerk, pilot, flight attendant, lawyer, school teacher. . . and what the monthly take-home pay (after federal taxes) would be for each of these jobs. So. . .is a college education really worth the time and money invested for your particular profession?
4. How much adult life costs: housing, groceries, transportation, utilities and insurance. True to one of my previous examples of teaching children about money, I brought in $3,000 (which is a typical take home salary if you make $50,000/year -- the average salary in Las Vegas) in cash -- in $10 bills. Together we paid the bills of a typical family in southern Nevada. Much to their surprise, we ran out of money, long before we ran out of bills. This was very eye-opening to this lovely group of girls.
5. How compound interest works. We walked through how compound interest works in your favor if you're saving money or investing, but how it works against you if you're paying off a loan or a credit card bill. We also discussed how the length of the loan (or investment) and the interest rate influence your payment (or return) and the total you will pay (or earn) over the lifetime of the loan (or investment).
It was a fun night, and I felt like the girls were right with me. But I'd love to know what YOU would have said to them? What do you wish someone had told you at their age?
Showing posts with label Paying off Debt. Show all posts
Showing posts with label Paying off Debt. Show all posts
Sep 27, 2010
Aug 2, 2010
Setting Financial Goals (Carole)
Anyone who knows anything about my husband knows that he is a goal setter. I'm not sure how old he was when he set his first goal, but by the time I met him when he was 23, it was deeply entrenched in his soul. In fact, when we were on our honeymoon back in the summer of 1983, he insisted that we take the time to write down our life goals. These goals dealt with education, career, lifestyle, finances, travel, life experiences and habits to name a few. We still have the original papers we wrote these down on in our Goals Binder that is kept at his desk at home. We bring these sheets back out at least once a year and review how we're doing. I'm frankly flabbergasted at how many of these goals we have achieved over the past 27 years! We continue to set goals every year (both as a couple and individually), but we especially enjoy looking back at those original goals. A few of them didn't turn out to be realistic or even relevant, but many of them were right on track.
You'll not be surprised that paying off our student loans in five years, paying off our house early and a set $ amount saved for our retirement years were a major portion of what we talked about that day. In 1983, David was just about to begin his 2nd year of dental school and we were right in the middle of the whole student loan thing. The idea of even buying a house was still years in the future and retirement seemed light years away. But even so, we tried to make our best guess for
1. How many years until we would be able to buy a house?
2. What would a dental practice cost?
3. How many years would it take to pay off our student loans?
4. How much money will we need to retire in 2030?
This was an exciting discussion! Our entire lives were ahead of us.
Now 27 years later (our anniversary is 2 weeks away) we've accomplished MANY of these goals -- and amazingly close to the dates we chose way back then.
I would highly recommend that you take time to think your life-time finances through, map out a plan and write it down. I would encourage you mix in a hefty dose of Blue Sky with your Reality. You really need both. I think goals should move you forward at a speed (and maybe in a direction) that normal life would not. If this were not true, why bother? It's nice to be able to look back every year at a written goal sheet and be reminded of what you had hoped for when you were young and idealistic. Maybe you'll discover you're ahead of the game in a few areas and possibly you'll be grateful for a nudge to get moving forward again.
You'll not be surprised that paying off our student loans in five years, paying off our house early and a set $ amount saved for our retirement years were a major portion of what we talked about that day. In 1983, David was just about to begin his 2nd year of dental school and we were right in the middle of the whole student loan thing. The idea of even buying a house was still years in the future and retirement seemed light years away. But even so, we tried to make our best guess for
1. How many years until we would be able to buy a house?
2. What would a dental practice cost?
3. How many years would it take to pay off our student loans?
4. How much money will we need to retire in 2030?
This was an exciting discussion! Our entire lives were ahead of us.
Now 27 years later (our anniversary is 2 weeks away) we've accomplished MANY of these goals -- and amazingly close to the dates we chose way back then.
I would highly recommend that you take time to think your life-time finances through, map out a plan and write it down. I would encourage you mix in a hefty dose of Blue Sky with your Reality. You really need both. I think goals should move you forward at a speed (and maybe in a direction) that normal life would not. If this were not true, why bother? It's nice to be able to look back every year at a written goal sheet and be reminded of what you had hoped for when you were young and idealistic. Maybe you'll discover you're ahead of the game in a few areas and possibly you'll be grateful for a nudge to get moving forward again.
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Jul 21, 2010
The Magic of Compound Interest (Carole)
When you are investing money, there are two basic types of interest your money can earn: Simple Interest and Compound Interest.
Quickly, let's look at the difference between these.
Add this interest earned to your original $10,000
The formula is a bit complex and hard for me to type out, but you can look it up here if you just really need to see it for yourself.
Monthly Interest = $27,126.40
Yearly Interest = $26,532.98
The longer your money is invested the more interest you'll earn. Your same $10,000 at 5% for 30 years turns into $43,219.42 Same money, same interest for 40 years is $70,399.89
The higher your interest rate, the more interest you'll earn. Your same $10,000 at 10% for 20 years will become $67,275.00
Combine longer time and higher interest and it starts to get really fun:
$10,000 at 10% for 30 years = $174,494.02
$10,000 at 10% for 40 years = $452,592.56
$10,000 at 12% for 20 years = $96,462.93
$10,000 at 12% for 30 years = $299,599.22
$10,000 at 12% for 40 years = $930,509.70 (yep, nearly a million $)
Imagine if you could scrape together only $10,000 by age 20 and find a good mutual fund that paid 12% interest (not that difficult really) and just LEFT YOUR MONEY THERE until you were 65 years old, you would have $1,639,876.04 That's without you ever adding one more cent of principal to this investment. The sooner you can get investing in something earning a decent interest rate, the better off you will be at retirement.
That is magic. If you want to work some magic yourself, here is a compound interest calculator. I'll warn you -- it's addictive!
P.S. Your mortgage (or car payment, student loan, credit card bill. . .) works on a compound interest formula in your lender's favor. That is why you often end up paying 3 times the cost of your house by the time your loan is completed.
Quickly, let's look at the difference between these.
Simple Interest
(Interest is only calculated on the money you have invested):
If you invest $10,000 (your principal) at 5% interest for 20 years:$10,000 x 5% x 20 years = $10,000 (interest earned)
$10,000 + $10,000 = $20,000
Compound Interest
(Interest is calculated on your invested money PLUS your previously earned interest):
If you invest $10,000 (your principal) at 5% interest for 20 years with compound interest you'll end up with $26,532.98 . The formula is a bit complex and hard for me to type out, but you can look it up here if you just really need to see it for yourself.
In addition:
The more often your compound is calculated (daily, monthly, yearly) the more interest you will earn. Daily Interest = $27,180.96Monthly Interest = $27,126.40
Yearly Interest = $26,532.98
The longer your money is invested the more interest you'll earn. Your same $10,000 at 5% for 30 years turns into $43,219.42 Same money, same interest for 40 years is $70,399.89
The higher your interest rate, the more interest you'll earn. Your same $10,000 at 10% for 20 years will become $67,275.00
Combine longer time and higher interest and it starts to get really fun:
$10,000 at 10% for 30 years = $174,494.02
$10,000 at 10% for 40 years = $452,592.56
$10,000 at 12% for 20 years = $96,462.93
$10,000 at 12% for 30 years = $299,599.22
$10,000 at 12% for 40 years = $930,509.70 (yep, nearly a million $)
Imagine if you could scrape together only $10,000 by age 20 and find a good mutual fund that paid 12% interest (not that difficult really) and just LEFT YOUR MONEY THERE until you were 65 years old, you would have $1,639,876.04 That's without you ever adding one more cent of principal to this investment. The sooner you can get investing in something earning a decent interest rate, the better off you will be at retirement.
That is magic. If you want to work some magic yourself, here is a compound interest calculator. I'll warn you -- it's addictive!
P.S. Your mortgage (or car payment, student loan, credit card bill. . .) works on a compound interest formula in your lender's favor. That is why you often end up paying 3 times the cost of your house by the time your loan is completed.
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Jul 5, 2010
The Burden of Student Loans (Carole)
I ran across this video a few weeks ago on CNN. Go ahead and watch it, and then I'll comment.
I've mentioned before on this blog, that my husband (and I, although the debts were not for my schooling) came out of graduate school with $60,000 in student loans. This was back in 1986. We lived extremely cheaply and only paid for tuition out of our student loans. We were able to earn enough money during the summers and through my job (as a lowly secretary at the university -- so nothing amazing) to pay for our actual living expenses. And, I might add, we never went on food stamps. I'm troubled by this growing trend. But that is another subject for another post.
It is easy to forget while buried in school and taking out student loans, that the day will come when all that money (with interest) has to be paid back. Typically your re-payment begins 6 months after graduation. This date arrives faster than you can imagine. Most loan repayment amounts are several hundred dollars per month, but if you've got debt for graduate school they are often well over $1,000 per month. That is a hefty portion of your brand new salary. Can you really make enough money to live on after your student loan payments?? And most student loans stretch over at least 15 years. That is a long time to be paying back this money.
Repaying student loans is no different than any other debt repayment. Set up a debt snowball and pay it off as fast as possible! But it is best to have a plan before getting into the student loan quagmire. Here are a few ideas to contemplate:
* Go to a local college or university. As a state resident, your tuition is usually about half of what it would be if you are from out-of-state.
* Become a state resident before you attend the school of your choice. A friend of ours who was planning to attend the dental school in Las Vegas moved here a year early, got a job and established residency. He saved himself $15,000/year or $60,000 total.
* Get a bachelor's degree at a college that will not require you to live away from home or pay high tuition. Save student loans for graduate degrees, not a basic college education.
* Apply for any and all scholarships possible. Keep on top of these year to year so you don't lose them. Many students lose these only because they didn't renew them on time.
* Are any grants available for your program? You never have to pay back grant or scholarship money.
* Do everything necessary to be at the top of your class. Top students are often given research or teaching jobs that pay most or all of your tuition.
* Choose your school wisely. Do you really have to have your degree from Harvard?? Think about the debt you will incur (as this fellow in the CNN video didn't). Ask a mature adult who is good with money if this seems like too much money for your educatiaon.
* Determine if your chosen career path is worth the tuition money you will spend. Last fall I heard a caller on the Dave Ramsey Show tell how she and her husband had over $200,000 in student loans for chiropractic school, and now he hadn't been able to find a decent job and they were getting very very frightened for their future. Dave Ramsey informed her that (despite claims from chiropractic schools) these types of doctors do not make the same amount of money typically that an MD does. He felt this couple had way too much debt for the earning potential of a chiropractor. Do your research and make sure it is accurate. Talk to people who are in your field to find out accurate salaries.
*Consider the location of your school. Is it an expensive place to live? Will your school debt be much, much greater because you have to live in New York City or Boston? The mid-west is typically pretty inexpensive as are parts of the south.
I'm certainly not against education in any way! In fact we tell our children that a bachelor's degree is a minimum and that a masters degree (at least) in their field will probably be necessary to compete in today's job market. But don't fool yourself or "blue sky" these kinds of important decisions. Student loans can add a significant financial burden that will follow you for half of your working life if you're not careful.
Like always, plan ahead and live frugally. You'll always be glad you did.
I've mentioned before on this blog, that my husband (and I, although the debts were not for my schooling) came out of graduate school with $60,000 in student loans. This was back in 1986. We lived extremely cheaply and only paid for tuition out of our student loans. We were able to earn enough money during the summers and through my job (as a lowly secretary at the university -- so nothing amazing) to pay for our actual living expenses. And, I might add, we never went on food stamps. I'm troubled by this growing trend. But that is another subject for another post.
It is easy to forget while buried in school and taking out student loans, that the day will come when all that money (with interest) has to be paid back. Typically your re-payment begins 6 months after graduation. This date arrives faster than you can imagine. Most loan repayment amounts are several hundred dollars per month, but if you've got debt for graduate school they are often well over $1,000 per month. That is a hefty portion of your brand new salary. Can you really make enough money to live on after your student loan payments?? And most student loans stretch over at least 15 years. That is a long time to be paying back this money.
Repaying student loans is no different than any other debt repayment. Set up a debt snowball and pay it off as fast as possible! But it is best to have a plan before getting into the student loan quagmire. Here are a few ideas to contemplate:
* Go to a local college or university. As a state resident, your tuition is usually about half of what it would be if you are from out-of-state.
* Become a state resident before you attend the school of your choice. A friend of ours who was planning to attend the dental school in Las Vegas moved here a year early, got a job and established residency. He saved himself $15,000/year or $60,000 total.
* Get a bachelor's degree at a college that will not require you to live away from home or pay high tuition. Save student loans for graduate degrees, not a basic college education.
* Apply for any and all scholarships possible. Keep on top of these year to year so you don't lose them. Many students lose these only because they didn't renew them on time.
* Are any grants available for your program? You never have to pay back grant or scholarship money.
* Do everything necessary to be at the top of your class. Top students are often given research or teaching jobs that pay most or all of your tuition.
* Choose your school wisely. Do you really have to have your degree from Harvard?? Think about the debt you will incur (as this fellow in the CNN video didn't). Ask a mature adult who is good with money if this seems like too much money for your educatiaon.
* Determine if your chosen career path is worth the tuition money you will spend. Last fall I heard a caller on the Dave Ramsey Show tell how she and her husband had over $200,000 in student loans for chiropractic school, and now he hadn't been able to find a decent job and they were getting very very frightened for their future. Dave Ramsey informed her that (despite claims from chiropractic schools) these types of doctors do not make the same amount of money typically that an MD does. He felt this couple had way too much debt for the earning potential of a chiropractor. Do your research and make sure it is accurate. Talk to people who are in your field to find out accurate salaries.
*Consider the location of your school. Is it an expensive place to live? Will your school debt be much, much greater because you have to live in New York City or Boston? The mid-west is typically pretty inexpensive as are parts of the south.
I'm certainly not against education in any way! In fact we tell our children that a bachelor's degree is a minimum and that a masters degree (at least) in their field will probably be necessary to compete in today's job market. But don't fool yourself or "blue sky" these kinds of important decisions. Student loans can add a significant financial burden that will follow you for half of your working life if you're not careful.
Like always, plan ahead and live frugally. You'll always be glad you did.
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Jun 21, 2010
Why You Want a 15 Year Mortgage (Carole)
There are 4 excellent reasons to have a 15 year mortgage:
1. You will build equity in your house much faster, since each monthly payment has a larger percentage of your money going toward the principle.
2. You will own your house (FREE AND CLEAR) in 15 years. You'll be amazed at how quickly 15 years passes in your adult years.
3. You will save tens of thousands of dollars in interest on a 15 year mortgage compared to a 30 year mortgage. More about this in a minute.
4. Interest rates are typically .5% lower on a 15 year mortgage.
Take a moment to visit a mortgage calculator . Type in your own mortgage information (full amount of your loan and interest rate) using a 15 year time line and then do it again with a 30 year time line. Have the calculator figure out your amortization schedule and scroll down to the bottom to see how much interest you will have paid to your lender over the life of your loan. You'll see that even though your monthly house payment will go up a bit with the 15 year mortgage, you will save more than HALF of the interest $ you would have paid with a 30 year loan!
30 year mortgage on $150,000 at 7% interest. Your monthly payment would be $1097.75. During the 30 years that you pay on your loan, you will pay your lender $209,263.35 in INTEREST. (This means you will have paid way more than double the original price of your house). Ugh.
15 year mortgage on $150,000 at 7% interest. Your monthly payment would be $1348.24. During the 15 years that you pay on your loan, you will pay your lender $92,683.63 in interest. So even though your monthly payment went up by $250.49, your overall savings on this loan is $116,579.72. Fantastic!
Yes, you can do this on your own by getting a 30 year mortgage (with the lower monthly payment), but paying at the 15 year payment rate. This plan gives you wiggle room if you ever hit some hard times and need a lower monthly payment to fall back on. Just make sure you're the kind of person who is very disciplined and will keep to the 15 year schedule.
Remember, housing is one place you want to be very, very careful with your money. Your ability to save yourself hundreds of thousands of dollars is very real. Take the time to do your homework -- and reap unbelievable rewards.
1. You will build equity in your house much faster, since each monthly payment has a larger percentage of your money going toward the principle.
2. You will own your house (FREE AND CLEAR) in 15 years. You'll be amazed at how quickly 15 years passes in your adult years.
3. You will save tens of thousands of dollars in interest on a 15 year mortgage compared to a 30 year mortgage. More about this in a minute.
4. Interest rates are typically .5% lower on a 15 year mortgage.
Take a moment to visit a mortgage calculator . Type in your own mortgage information (full amount of your loan and interest rate) using a 15 year time line and then do it again with a 30 year time line. Have the calculator figure out your amortization schedule and scroll down to the bottom to see how much interest you will have paid to your lender over the life of your loan. You'll see that even though your monthly house payment will go up a bit with the 15 year mortgage, you will save more than HALF of the interest $ you would have paid with a 30 year loan!
Here is an example:
30 year mortgage on $150,000 at 7% interest. Your monthly payment would be $1097.75. During the 30 years that you pay on your loan, you will pay your lender $209,263.35 in INTEREST. (This means you will have paid way more than double the original price of your house). Ugh.
15 year mortgage on $150,000 at 7% interest. Your monthly payment would be $1348.24. During the 15 years that you pay on your loan, you will pay your lender $92,683.63 in interest. So even though your monthly payment went up by $250.49, your overall savings on this loan is $116,579.72. Fantastic!
Yes, you can do this on your own by getting a 30 year mortgage (with the lower monthly payment), but paying at the 15 year payment rate. This plan gives you wiggle room if you ever hit some hard times and need a lower monthly payment to fall back on. Just make sure you're the kind of person who is very disciplined and will keep to the 15 year schedule.
Remember, housing is one place you want to be very, very careful with your money. Your ability to save yourself hundreds of thousands of dollars is very real. Take the time to do your homework -- and reap unbelievable rewards.
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Jun 15, 2010
When is it Right to Refinance a Mortgage? (Carole)
First the disclaimer: I am not an expert. However, we have refinanced our mortgages a couple of times over the years and so I do have some experience with this subject. At the end of this post, I'll link to some websites that explain things in much greater detail.
Here are the basics:
Pros of Refinancing your Mortgage:
1. Lower your monthly payment
2. Can shorten the length of your mortgage (changing from a 30 year loan to a 15 year loan)
Cons of Refinancing your Mortgage:
1. You return to the BEGINNING of your mortgage cycle -- meaning that your are at Payment #1 again.
2. Because you are on Payment #1 again, the portion of your monthly payment that goes toward paying the principle goes back to its smallest amount and your payment portion for interest goes back to its largest amount.
3. The lender charges closing costs for lowering your interest rate. You didn't think the bank was going to give you 10's of thousands of dollars for FREE, did you? Expect to pay at least $2,000 in closing costs. Obviously the more money you're borrowing, the higher your closing costs will be.
4. There are many other fees (beyond closing costs) associated with refinancing. To some degree, it is like you are buying your house all over again. Remember how fun that was?? Taxes, insurance, and prorated insurance will most likely be due also.
Don't refinance if you're selling the house soon. Go to Bankrate refinancing calculator and see how much your monthly payment will be with your new loan. Subtract that from your current monthly payment and see HOW MANY months it will take you to save the money you will have spent on closing costs, fees and taxes from your refinance. Will you own your house long enough to make up this $ difference?
Be careful with ARMs (Adjustable Rate Mortgages) right now. Home loan interest rates are currently so low, that the chances that your mortgage payment will adjust up in a year or two are very good. With the economy where it is, this could be dangerous for your financial future.
If you do refinance, go for a shorter length mortgage: 15 year instead of 30. You will save 10's of thousands of dollars over the life of your loan with just this one change.
Further reading:
Noodling Over a Mortgage Refinance
When is it Right to Refinance Your Mortgage?
Refinancing Basics
Here are the basics:
Pros of Refinancing your Mortgage:
1. Lower your monthly payment
2. Can shorten the length of your mortgage (changing from a 30 year loan to a 15 year loan)
Cons of Refinancing your Mortgage:
1. You return to the BEGINNING of your mortgage cycle -- meaning that your are at Payment #1 again.
2. Because you are on Payment #1 again, the portion of your monthly payment that goes toward paying the principle goes back to its smallest amount and your payment portion for interest goes back to its largest amount.
3. The lender charges closing costs for lowering your interest rate. You didn't think the bank was going to give you 10's of thousands of dollars for FREE, did you? Expect to pay at least $2,000 in closing costs. Obviously the more money you're borrowing, the higher your closing costs will be.
4. There are many other fees (beyond closing costs) associated with refinancing. To some degree, it is like you are buying your house all over again. Remember how fun that was?? Taxes, insurance, and prorated insurance will most likely be due also.
Good Advice
Most experts agree that you need to be able to reduce your loan interest rate by at least 2.0% to make it worth all the fees you will be charged. Don't refinance if you're selling the house soon. Go to Bankrate refinancing calculator and see how much your monthly payment will be with your new loan. Subtract that from your current monthly payment and see HOW MANY months it will take you to save the money you will have spent on closing costs, fees and taxes from your refinance. Will you own your house long enough to make up this $ difference?
Be careful with ARMs (Adjustable Rate Mortgages) right now. Home loan interest rates are currently so low, that the chances that your mortgage payment will adjust up in a year or two are very good. With the economy where it is, this could be dangerous for your financial future.
If you do refinance, go for a shorter length mortgage: 15 year instead of 30. You will save 10's of thousands of dollars over the life of your loan with just this one change.
Further reading:
Noodling Over a Mortgage Refinance
When is it Right to Refinance Your Mortgage?
Refinancing Basics
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May 18, 2010
Debt Free (Janssen)
On Friday, I called up our student loan provider (the third company we've worked with in the eight and a half months since graduation, since they keep selling our loans) and paid off the last $1,793 of our debt.
We are now, officially, debt free!
At graduation, our student loans totaled $33,000, some in my name, some in Bart's, all happily subsidized (meaning they didn't start accruing interest until six months after graduation, rather than accruing interest from the moment the loans were issued at the beginning of the semester) .
The loans were all for a period of ten years, with a 6.8% interest rate, which was a much higher interest rate than either of us thought we'd have to pay for student loans.
If we had paid them off over the 10-year term of the loans, we would have paid not only our $33,000 in actual loans, but an additional $12,570 in interest. Instead, we paid less than $250 in interest in all because we paid off a large portion of the loans just before the grace period ended, and the rest within another three months.
We committed to paying off the loans as fast as we could the moment we started our full-time jobs 9 months ago, and that allowed us to make huge headway on them before the interest caught up with us.
Today, student loans are extremely common, and are viewed probably second only to mortgages on the "good-debt" spectrum. And I'm sure there are financial advisers who would have recommended we invest our $33K instead of paying our loans off right away.
"You could see a return of 10% or more on your money over those same ten years. That would cover the student loan interest and net you a return of 3%! How do you like THEM apples?"
And yet, somehow, we just weren't interested in doing that. I don't know if it's "the great recession," our parents' examples, the peace that comes from being debt free, the certainty of the interest we'd have to pay, the looming responsibility of new parenthood, or a combination of all of those things, but we just wanted to be done with our student loans and move on.
I'd take the financial surety of being debt-free over a possibility of a 3% return any day.
We are now, officially, debt free!
At graduation, our student loans totaled $33,000, some in my name, some in Bart's, all happily subsidized (meaning they didn't start accruing interest until six months after graduation, rather than accruing interest from the moment the loans were issued at the beginning of the semester) .
The loans were all for a period of ten years, with a 6.8% interest rate, which was a much higher interest rate than either of us thought we'd have to pay for student loans.
If we had paid them off over the 10-year term of the loans, we would have paid not only our $33,000 in actual loans, but an additional $12,570 in interest. Instead, we paid less than $250 in interest in all because we paid off a large portion of the loans just before the grace period ended, and the rest within another three months.
We committed to paying off the loans as fast as we could the moment we started our full-time jobs 9 months ago, and that allowed us to make huge headway on them before the interest caught up with us.
Today, student loans are extremely common, and are viewed probably second only to mortgages on the "good-debt" spectrum. And I'm sure there are financial advisers who would have recommended we invest our $33K instead of paying our loans off right away.
"You could see a return of 10% or more on your money over those same ten years. That would cover the student loan interest and net you a return of 3%! How do you like THEM apples?"
And yet, somehow, we just weren't interested in doing that. I don't know if it's "the great recession," our parents' examples, the peace that comes from being debt free, the certainty of the interest we'd have to pay, the looming responsibility of new parenthood, or a combination of all of those things, but we just wanted to be done with our student loans and move on.
I'd take the financial surety of being debt-free over a possibility of a 3% return any day.
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