Ask Terry Questions Parent plus loans

Parent plus loans

By Terry Savage on May 18, 2024 | College Savings / Student Loans

Hi Terry, we recently received a bit of money after my inlaws passed. It’s currently in a savings account earning 4.25%. Should we keep it there, keep some (we have some money in 401K’s but not a ton and no emergency savings account) or pay down our parent plus loans which have a 5-8.05% interest rates?

Terry Says

First read this article, which I just posted:  News on Student Loans and Credit Card Rules – Terry Savage

If you’ve been paying for a long time, you might be in line to get the loan balance forgiven!  They just extended the deadline to June 30th, so act quickly if this might apply to you.  Details in the article.

And if it doesn’t apply, maybe half and half??  It’s always good to have some “liquidity” in savings for an emergency.  Also assuming you have no high-rate credit card debt.



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