Question

SARAH makes $43,000 per year, is single, and lives in Connecticut. She has $19,000 in subsidized loans and $8000 in unsubsidized loans.

Answer 1

Answer:

The standard repayment plan.

Step-by-step explanation:

Here is the complete question :

SARAH makes $43,000 per year, is single, and lives in Connecticut. She has $19,000 in subsidized loans and $8000 in unsubsidized loans. Which repayment plan will be the cheapest for her in total?

The standard repayment plan is a repayment plan where a fixed sum is paid monthly for 10 years. This makes a total of 120 payments. The advantage of the standard repayment plan over the federal repayment plan is that less interest is paid and payment is made over a shorter period

Because unsubsidized loans accrue a higher interest expense when compared to subsidized loans, Sarah should pay off her unsubsidized loan first. This would minimise interest payment