Should I start paying my loans back now or defer for a year while teaching abroad?

Hello! I have $28,000 in student loans to repay.

They are broken down as follows: $5,500 at 3.86% interest, $6,500 at 4.66%, $7,500 at 4.29%, $5,500 at 3.76% and a $3,000 Perkins loan, I am unsure of the interest at this moment.

I received a Fulbright grant to teach English abroad for a year fully funded. I can defer my loans during this time. However, after the year, I would like to join the Peace Corps which would last 27 months, also fully funded.

I have about $25,000 in savings and would like to pay a chunk of my loans off as well as begin monthly payments, but I am not sure if I should do that now, do it after my year abroad, or do it after Peace Corps (I believe I can defer them then too). Peace Corps will also pay off a large portion of the Perkins loan while I am serving.

What is the best course of action to take here? My mom always advised me to save my money in case of an emergency which is why I have so much saved up and she seems to think deferring is the best option, again, in case of an emergency. I think I would like to start paying now before interest builds up. Thank you very much!

Posted Aug 17, 2017, 8:17 PM UTC

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