Dear Dish on Financial Planning
Dear Dish,
I love chips. I mean, I LOVE chips. I try not to buy them when I’’m shopping, cause I know they’’re bad for me, but what ends up happening is that I dream about them on the bus on the way home (literally), and inevitably stop at a convenience store, telling myself that I’’ll only have a few before dinner. Let’’s be honest; those chips end up AS my dinner 10 times out of 10. I have a disease.
My question is this: is it better for me to pay off my student loan entirely BEFORE I start investing in RSPs and saving for a house, or should I just keep paying the minimum amount on my loan as the interest rate is so low?
Signed,
Financially inept
Dear Financially inept:
It is never too early to start thinking about retirement. The sooner you can retire the better. Work is for suckers. Put at least some money in RRSPs.
Also, please stop bad mouthing chips. You are upsetting me. Chips are chock full of vitamin C and therefore a perfectly healthy dinner.
Dish
posted by Dish @ 6:25 PM
8 Comments:
Did le Dish not read the letter? I LOVE CHIPS. There was no bad-mouthing of the chips.
Dish,
your advice column is my advice column of choice!
-a fan
dang! so much for remaining anon I should have toggled off my identity.
Dear FI:
You said the chips were a disease. Generally diseases are not good things.
Finally! Vindication! I eat chips constantly and am convinced they are the reason why I am very rarely sick. I get maybe one cold a year and I haven't had the flu in YEARS. I believe it comes from eating chips nearly every day. Screw apples! A bag of chips a day keeps the doctor away!
My addiction to the chips is a disease, as are most addictions. The chips themselves and innocent and wholesome (like cigarettes and gambling...)
Dish and F.I.:
Now, keep this is mind: I'm not a professional advice columnist, but I do like chips also, so I think that entitles me to an opinion. However, I am a man, so that might limit my credibility. Regardless...
Here's my $0.02 on loans and RRSPs. The interest on your student loans will always be small compared to interest elsewhere. The good old govt helps out student debtors and keeps the interest low, usually below prime.
So don't be in such a rush to pay it off. A little debt never hurt anyone. My advice: save towards a down payment on a house, so your money can start working for you, building up in value and equity.
Think of it this way: what are the pros to paying off your student loan? Hmm? Not much. They don't give you a car or something, that's for sure...
Peace.
James you forgot that you can also write off the intrest of the student loans on your taxes, but they have to be Canada student loans not line of credit loans.
Pay credit cards first 20-30% intrest!
Small loans have higher intrest rates than bigger loans. You pay it faster and then you can trow that money at the bigger loan!
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