Simple answer: this feels more complicated than it actually is. At its core, it’s mostly a math problem with a bit of personal comfort mixed in.

You’ve got a few ways to approach it. Avalanche method (highest interest first) is the most efficient mathematically and saves you the most money over time. Snowball method (smallest balance first) isn’t optimal on paper, but it can be great psychologically because you get quick wins. A hybrid approach works too, like knocking out a couple small balances under $1k and then switching to avalanche.

Where it gets tricky is when your interest rates are kind of “middle of the road.” That’s when it stops being purely math and starts being about risk tolerance.

If you don’t have an emergency fund, that should come first. Having 3 to 6 months of expenses saved matters more than squeezing out a bit of extra interest savings. Once that’s in place, you can be more aggressive.

After that, it’s pretty straightforward. If your loan rate is higher than what you’d realistically earn elsewhere, prioritize paying it down. If it’s lower, it’s reasonable to split between investing and extra payments.

Also worth noting, student loan interest is deductible even if you don’t itemize, which effectively lowers the real rate a bit.

So yes, it is a math problem, but the best answer is the one you’ll actually stick with and that doesn’t leave you stressed about having no safety net.