<p>I'm a freshman right now and I have taken out 3 loans: a
Subsidized Stafford loan, an Unsubsidized Stafford Loan, and a Perkins
loan:</p>
<p>Subsidized Stafford Loan: $3,500 ($1,750 disbursed twice throughout the
year) with interest at 6%.</p>
<p>Unsubsidized Stafford Loan: $2,000 ($1,000 disbursed twice) with
interest at 6.8%</p>
<p>Perkins Loan: $1,000 ($500 disbursed twice) with interest at 5%.</p>
<p>I'm looking to start paying for some of my loans right now. I've been
thinking of starting to pay for the unsubsidized stafford loan first
since interest has accrued for it, and I believe the government pays
the interest accrued while I'm in school for the subsidized stafford
loan and the perkins loan.</p>
<p>After paying off the unsubsidized stafford loan during the next couple
of months, I'm thinking of then moving on to the subsidized stafford
loan, and then finally the perkins loan. Is this a wise decision to do
so?</p>
<p>I would not start paying on the subsidized loans until they are due. (9 months after graduation or dropping below 1/2 time for Perkins, 6 months for sub stafford). If you have money to spare save it and earn interest on it then pay the loans off just before the govt stops paying the interest for you. This is probably the only time in your life you will get interest free loan money.</p>
<p>Even then bear in mind that the interest rates are relatively low and you can claim a tax deduction for them and take that into account if you are likely to be taking on any other debt that will have a higher interest.</p>
<p>Don’t pay off your loans. Pay the interest on the un-subsidized loans. Save your $'s for future years in case aid is cut for some reason.</p>
<p>The loans have origination fees, so there is no reason to pay down loans, just to get new ones in the future.</p>
<p>I would suggest paying the unsub loans back. If you are a saver, you can put off repayment on the sub & Perkins - as long as you are not tempted to blow the money you have been saving.</p>
<p>So is it a good idea to start paying for the unsubsidized loan now, and save money and don’t pay for the subsidized loans until it’s time to do so?</p>
<p>Yup. That would more or less be the standard advice.</p>
<p>Provided that you have the money available, of course.</p>