Pay Off Student Loans or Invest in Real Estate?

[Brandon Jurczyszyn]

Hello BP!

I am a recent college grad, and have been lucky enough to graduate with a relatively low amount of debt compared to the average grad. I have been actively paying off my debt each month, and at this time, I have about $16K left to pay.

Over the past couple months I have become more and more serious about investing in real estate. I've spent a majority of my free time educating myself about the process by reading books, forum posts, listening to podcasts, etc. So far, I have set my first goal of purchasing a residential MFR property in 2018 in the Metro Detroit market.

My question here is - would you pay off the rest of your student debt before investing in a rental property?

Let me know!

[James Masotti]

@Brandon Jurczyszyn - I've been out of school for 10 years now and still owe over 20k in student loan debt. My interest rates are so low though in comparison to the return on capital I get with my real estate investments it just doesn't make any sense for me to pay them off. When the balance on one of my loans gets below $1000 I usually write a check to pay it off...but otherwise...they'll be there for awhile. 

That having been said...if I ever decide to quite my full-time job and live off my passive real estate income, I'll pay off all my outstanding debts first in order minimize the amount of of cash needed to live off.