Hello, everyone. I'm just looking for a little advice on this topic. I recently recieved my reenlistment bonus in a lump sum and I used half of that to pay all my debts off except for my student loans. Then I finally finished fully funding my six money living expense account that I have in a HYSA. So I'm currently consider debt free except for my student loans. My student loans are almost over $9k currently. Back in 2022 I submitted an application to Department of Education. It's called a Borrower Defense Case that I submitted to get all my student loans waived because the school I attended was over charging students and making promises to students that wasn't true. After the application process, I was told through an automatic email from fasfa that if I haven't received a case updated or decision by 2026, that all my funds will be waived and I don't have to pay anything. Currently I have the money to pay it but I don't want to pay it and later find out that they approve my case and waive all my student loan debt. Also I'm pretty sure you don't get any of the money you paid back after if they decided to grant my waiver. Due to the case they automatically put my student loan account into forbearance and I don't have to make a payment until 2027. Any tips or feedback would be great. Thanks in advance!
Pay student loans and get it over with or wait for case to settle
byu/Multimeechy inMilitaryFinance
Posted by Multimeechy
2 Comments
I recommend taking the payoff amount and putting it into an index like the S&P 500. You are arbitraging the difference between the S&P return and the interest rate so you’re making money while you’re waiting for the decision to be made.
If you won’t get paid back on money you’ve spent repaying the loan, it is probably best to put that money somewhere relatively safe and wait for the determination.
You’ve already fully funded an emergency fund, so it’s up to you and your risk tolerances on what you do with the rest. The safest bet is to drop it in the HYSA so it makes a little money and stays easily accessible.