So I wanted to bounce this off a few people in this forum:
I'm about to start intern year of residency. Assume I refinance my medical student loans (close to $300K) at a fixed interest rate of ~5-6%. Wouldn't "investing" all of my savings into paying off student loans be equivalent to a 5-6% tax-free rate of return (a difficult rate of return to find elsewhere)? Not only is the rate of return tax-free, but the interest payments are tax deductible. Therefore, would it not make the most sense to place my monthly savings into paying off student loans as opposed to saving for retirement? The exception would be if my employer matches any 401(k) contributions, in which case, I'd contribute up to the maximum match because that is essentially free money.
I also want to save toward starting a private practice upon graduating from residency. I figure between saving for that and paying into student loans, there really won't be anything left to put toward a Roth IRA or unmatched 401(k).
Thoughts?
I'm about to start intern year of residency. Assume I refinance my medical student loans (close to $300K) at a fixed interest rate of ~5-6%. Wouldn't "investing" all of my savings into paying off student loans be equivalent to a 5-6% tax-free rate of return (a difficult rate of return to find elsewhere)? Not only is the rate of return tax-free, but the interest payments are tax deductible. Therefore, would it not make the most sense to place my monthly savings into paying off student loans as opposed to saving for retirement? The exception would be if my employer matches any 401(k) contributions, in which case, I'd contribute up to the maximum match because that is essentially free money.
I also want to save toward starting a private practice upon graduating from residency. I figure between saving for that and paying into student loans, there really won't be anything left to put toward a Roth IRA or unmatched 401(k).
Thoughts?
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