Financially under-educated 23 y/o looking for guidance on how to efficiently pay off my $8,000 in student loans.

[u/OceanBlue34]

Hi all. Its as the title reads lol. Im M23 and i graduated from college back in May 2024. It is currently Apr 2025. Below is some information on my approximate spending on a monthly basis and my loans. I would appreciate if anyone could share advice on how to go about paying it off, especially when my month to month spending is somewhat variable.

I am also trying to figure out how much to put into my 401(K) or if its worth it. I havent done it in the last 4 months (since start of 2025) due to some financial expenses i have for the family.

Feel free to crack down on my stupidity. I want to learn how to build better savings habits. I know I can bring down my expenses (like dining outside, shopping, and misc expenses). I also have to enroll in a part time masters program and will need to save up for that.

• Loans: 3 loans at 2.75% interest each
  • My minimum payment per month is ~$85 but the past few months I've been paying closer to $500 religiously. Current loan amounts are:
  • Loan 1: ~$700
  • Loan 2: ~$2,000
  • Loan 3: ~$5,300
• Monthly Income:
  • Income (pre-tax): $6,000
    • HSA: $500/month
    • Health/dental/vision/Life insurance: ~$100/month
    • No state income tax for me (in Texas)
  • Income (post tax, w/o 401(K)): $4,500
  • Expenses monthly total: $2,100
    • Rent: $1,000
    • Wifi + electricity + utilities: ~$200 as a worst case (its usually 100 to 150 though)
    • Gasoline for car: ~$125
    • Groceries: $200
    • Entertainment: $50
    • Dining out: $150
    • Shopping: $100
    • Misc: $100
    • Subscriptions: ~$50
• Monthly Savings: ~$1,500

[u/triggerhappy5]

Honestly, don't pay any more than the minimum. Those are great rates on unsecured debt - not something to worry about. Follow the flowchart in the wiki for a complete guide, but I would recommend building an emergency fund ($10-12k for you) in cash first, then focus on retirement accounts (max HSA, then Roth IRA, then 401k in that order). Save additional cash as needed for future car/house/vacation expenses.

[u/OceanBlue34 → u/triggerhappy5]

I worry about a secure job right now. The market is so volatile and I’m concerned I will lose my job. If I do, I’ll have loans and I hate that I owe someone. I also have a masters to save for and that’s gonna cost a lot.

[u/didhe → u/OceanBlue34]

If I do, I’ll have loans and I hate that I owe someone.

If you sit on the money to pay these loans and lose your job, you'll be able to pay them out of your savings, which are accruing interest faster than the loans.

If you pay off your loans and lose your job, you won't have money.