Paying down loans or keeping cash

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theroadtomed

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Just wanted people's opinion on this. By the time I start med school, my rough budgeting says that I should have about 5,000 cash on hand. I'll also have about 10,000 in loans to my name from undergrad. Does anyone think it would be better to drop that 5,000 into the undergrad loans, or would it be better just to keep the cash and use it to furnish an apartment, etc?

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Just wanted people's opinion on this. By the time I start med school, my rough budgeting says that I should have about 5,000 cash on hand. I'll also have about 10,000 in loans to my name from undergrad. Does anyone think it would be better to drop that 5,000 into the undergrad loans, or would it be better just to keep the cash and use it to furnish an apartment, etc?

Interest rate on the loan?
 
depends on interest rates and when you start accruing interest.

ie. if that is a high interest rate loan (private) or it is going to start accruing interest now, pay it off, and if you need money to furnish your apartment take that from your med school loans, assuming some of those loans are subsidized (not interest bearing till later) or maybe lower rates than your UG loans. My point is that there may be ways to have the same amount of cash, but owe less later.

If those factors are the same, and you must spend that money, then it doesn't matter where it comes from.

It's always a good idea to have a fair amount of cash on hand, or easily accessible, in case of emergency. `1-2k.
 
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Keep the cash. I stopped paying off my unsubsidized loans throughout undergrad because it's a waste of money.
 
It's not a bad idea to keep some for moving expenses, since you may not have your loan money by the time you move.
 
I mean it's only 10,000, which in the real spectrum of things is nothing at all compared to most people (I'm about 62,000 in now; oh joy). I'd keep the cash in pocket for damn sure.
 
Keep the cash. Some medical/ law/ graduate students would literally murder another human being for that much of a buffer. And while the money you could save on interest by paying off loans now may seem pretty impressive (it could amount to tens of thousands of dollars), the safety net is oh, so much better.
 
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