Tl:dr - Better to invest 5k or get a lower student loan rate, but tie up the money as part of the loan requirements
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I have the opportunity to re-finance a $50,000 student loan at a rate between 2%-3% interest (new loan term, 10 years), versus the current rate of 6.1%.
In order to get the best interest rate, I will need to have $5,000 as a minimum balance in a checking account with the bank.
I am assuming that the interest savings over the loan term make tying up this money work it, because I would save about $1,500 per year in interest, versus gaining several hundred a year (assuming 6% return).
Looking to get some advice on whether this logic holds, or if there are things I'm missing in my calculations/assumptions. TIA advance for (kind) advice, as I'm a bit of a newcomer to /financialplanning.
Submitted January 04, 2020 at 10:11PM by fcf328 https://ift.tt/35pwslh
