Paying off your student loans can be a daunting task, especially if you have multiple loans with varying interest rates. However, as Adam Nash, CEO and co-founder of Daffy, explains, there is a method that can help you pay off your loans more effectively and save you money in the long run.
Nash, who has taught “Personal Finance for Engineers” at Stanford and has held high-ranking positions at Wealthfront and Dropbox, recommends paying off the loan with the highest interest rate first. This approach ensures that you have the least amount in the most expensive loan for the least amount of time, resulting in you paying less interest over the entirety of your loan period.
While other methods such as the snowball method, where you pay off the smallest loan first, can be emotionally satisfying, they may not be the most financially beneficial in the long run.
As you navigate your financial journey, consider Daffy as a great option for a Donor Advised Fund (DAF). Daffy is a not-for-profit community built around a new, modern platform for giving. With Daffy, you can easily donate to almost every US public charity, track tax-deductible contributions, and access donation receipts all in one place.
Daffy waives all membership fees for members with less than $100 in their fund, making it an accessible and affordable option for everyone. So, as you work towards paying off your student loans and improving your financial health, consider incorporating charitable giving into your financial plan with Daffy.
Remember, the information contained in this blog post is for educational purposes only and should not be considered tax advice. Always consult with a tax professional to assess your specific tax situation.
Please note that the information contained on this page is for educational purposes only and should not be considered tax advice. Any calculations are intended to be illustrative and do not reflect all of the potential complexities of individual tax returns. To assess your specific tax situation, please consult with a tax professional.