I have a small student loan, the balance as of today is $1700. The interest rate is 6.55%. The minimum payment is $13.95. Estimated payoff date is 4/15/2024.
I have been making $25 monthly payments.
In the last 6 months, I have paid $150 but my balance has only reduced by about $78
My question is- is it worth it to even pay the extra few dollars a month? I feel like everything is going towards interest anyway ...
Student loan debt is the worst type of you can haver so the sooner you get ride of it , the better.
Interest on student loans are compounded daily, so it never feels like you're getting ahead. But, you will, eventually.
Paying $25 each month should have that loan paid off about 2.8 years early off a 10 year term (plugging in your numbers into an amortization calculator, total time to pay with payments of $25 is about 7.2 years ).
If you can afford to pay more, I would. $50/month would pay off even faster (in 3.2 years versus 10).
Hope that helps.