Greetings, Dave
Our daughter is enrolled in school and owes $10,000 in student loans. She has a few scholarships and works part-time, but she has taken out some loans to cover expenses. Her uncle informed us he wanted to give her a $10,000 gift after he recently sold his company. We’ve discussed this with her, and we want to put her in the best possible route. Should she utilize this present to settle her school loan debt or start investing and making plans for the future?
Gilbert
To Gilbert,
Thank you so much for attempting to assist your daughter in making the best financial and future decisions possible. Her uncle seems like a very giving man. Let’s take a moment to examine this scenario carefully.
We’ll begin by assuming she has no outstanding student loan debt. Would it make sense for her to take out a student loan in such a situation so that she could invest? Obviously not. I know that’s a stupid question, but I want you to think about it. It is equivalent to borrowing money to invest if you choose to invest the money rather than repay the loans. Do you see what I mean? That would not be a good plan.
I think it’s imperative that your daughter’s student debt situation be resolved as quickly as feasible. And her uncle’s gift to her is the ideal chance to accomplish it. Gilbert, pay attention to me. When your daughter graduates from school, the last thing she needs is a mountain of debt waiting for her. She’s simply not in a good position to be an investor right now, but I want her to start investing eventually. She must repay all of her student loans. I’m referring to paying off all of that debt as soon as she receives this amazing gift.
Second, she should start saving a ton of money after paying off her student loans so she can finish her education without taking on more debt!
Dave
