Nobody really knows what is going to happen this upcoming year. Would anyone have any insight this concept? It seems like either a really good time or a really bad time to be taking out loans.
deflation inflation and educational costs
- Thread starter lee9786
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From what I understand in 2008 we had deflation and 2009 we had inflation. 2010 is up for grabs.
I think the current student loan rate of 6.8 percent is great if we have high inflation in the next few years because then it'll be like free money and won't be annoying to pay off. I kind of think this is going to happen.
I'm not an expert in economics, so if someone can check over what I said that would be great.
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Too much to go into, but do NOT borrow any more than you absolutely have to. 6.8% is not a great interest rate and you do realize that you will mostly be paying back your loans with after tax dollars, right? Given the current trend of cutting physician earning potential, increasing hostility toward any high earner, caps on student loan interest deductions, and phase outs you'll be paying much more than you believe right now.
Also -- don't buy the conventional wisdom BS on inflation/deflation either. If you want to learn more on the matter, start here:
www.mises.org
Also -- don't buy the conventional wisdom BS on inflation/deflation either. If you want to learn more on the matter, start here:
www.mises.org
So MOHS you'd say the best idea would be just to pay down the debt ASAP and disregard the possible inflation trend that seems to be threatening this country due to overprinting of the dollar?
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No, I would not pay down low interest loans with (relatively) better purchasing power dollars today when the same loans can be paid back with (relatively) piss poor purchasing power dollars in the out years.
The best thing is to minimize the amount of loans that you take out. Then try to get as low an interest rate as possible. Then pay off the loans at a rate dependent upon the interest rate and expected returns on investments.
One reason to not pay off federal student loans as soon as possible (especially if you have family) is that they are one of the very few debts that are forgiven upon death. Take care of your family before Uncle Pilfer... he gets plenty before you ever get yours as it is....
The best thing is to minimize the amount of loans that you take out. Then try to get as low an interest rate as possible. Then pay off the loans at a rate dependent upon the interest rate and expected returns on investments.
One reason to not pay off federal student loans as soon as possible (especially if you have family) is that they are one of the very few debts that are forgiven upon death. Take care of your family before Uncle Pilfer... he gets plenty before you ever get yours as it is....
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