Should I pay off my student debt or invest my money? ( Canadian)
May 20, 2014 11:08 AM Subscribe
Going back to school in September after working for ~ 2 years. I've saved up a bit and I'm wondering how to make the best use of it.
posted by winterportage to Work & Money (10 answers total) 1 user marked this as a favorite
I'm going back to school in September. This means the precious, precious money I've saved over the past year is going to be whittled away and I need to know the best way to do it. I realize I'm privileged to be able to even put away this much for savings, and not everyone can manage this while paying their student loans. I appreciate any help you can give ( I never took Finance for Dummies 101 and my mom doesn't pay any attention to what I do with my money so I've never received any financial advice)
- My student loan principle is $5800 (CAD) and I pay $65.09 per month on that. The interest is at 3.5%. So I think the total of what I actually owe is something like $6600. I've been paying it for the past 2 years.
- I've saved $11,500 from my job over the past year. The savings account it's in has a 1.3% interest rate.
- I'm going on a Birthright trip in August which is mostly free but I want to save about $1000 max for that in case I decide to extend the trip by a few days.
Before going back to school, (where I will take on more loans but it's in Quebec so tuition is pretty cheap), should I pay off my original debt and have barely any savings?
Or, should I continue paying off the loan from my monthly income and invest my savings elsewhere? If invest, what should I do with the money?
Or, should I just use my savings to pay my tuition when I go back to school, and thus not take on any more debt?
I expect my tuition to be around $1300 per semester and the program itself is 3 semesters.