Empty investment account to take chunk out of student loan?
Hi all.
27m, married.
I started with about 98k in student loans 7 years ago. In 2023 I consolidated a mix of gov’t and private loans which totaled to $66K at 7.9% interest over 240 payments. A big regret but at the time I couldn’t afford the monthly. I’m in a better situation financially now, and just focused in the last two years to get this paid off. The debt currently sits at $33K, down $20k in principal from this time last year. I’m proud of the progress as if I just paid monthly from the start of 2023 the principal would be $62K. The monthly originally was $550 a month but I have been putting close to $1500 a month toward it, trying to get it paid off before children come into the situation, and just to get the burden off my shoulders.
I currently have an 3-5month emergency fund of $15k in a MMF that me and my wife share (about 3.4% interest). I also have a personal brokerage of about $14k just from recurring investment transfers. I recently stopped the weekly transfers (about $125 per week into various ETF’/ mutual funds) and decide to put that amount each week toward my loan instead.
I’m wondering if it would be best to liquidate my personal brokerage and put it against my loan which would take a huge chunk out of it. But I’m worried about the potential growth that it would have in the future if I just let it sit there. Given the risk of the market I realize paying off the loan would be a “guaranteed return” of the 7.9%, but just curious of your thoughts.
I want to get this debt paid off as soon as possible, but also wonder if I should just keep chipping away at it in hopes my brokerage will continue to grow over the next few years in the market.
Appreciate your thoughts/opinion :)