I just set up two extra payments towards my student loans. One to my ~$15k at 4.5% loan, and one to my ~$44k at 4% loan. And it was kind of on a whim. I was visiting my mint page (as I do, perhaps too often) and saw the reminder to pay my student loan bill. And technically, I don’t have to schedule payments, as I’ve signed up for their automatic bill pay setup (which I believe gives me a .25% interest rate deduction). But I can still manually set up payments.
Why did I do this? I think it was due in part to realizing that my savings account at ING is making pretty crummy interest(1.835% (1.85% APY)), compared to back in the heyday (only a few years ago!), though I will admit it’s still much better than the tiny rate I used to get at my brick and mortar bank. And so my money is going to do a lot more for me (net-worth speaking) paying down my student loans than it would be sitting in savings. And I actually didn’t move any money out of my savings account, I just took some out of my checking to pay these extra payments. So I’m not saving any less.
So, while I feel a bit anxious about the fact that I’ve reduced my liquid assets by ~$1k, in the long term, my net worth will thank me.
In the meantime, I’m also wondering if I should start “shopping around” for better savings account interest rates (or signing up for a CD ladder, which I’m still not very familiar with). I have heard good things about Emigrant Direct, but I’m not sure how much of an impact a slightly higher rate will have on my savings. What are you doing to counteract this crumbling economy of ours?