A finance expert shares advice on whether you should save for retirement or pay off your student loans

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Jean Chatzky is a personal finance expert and coauthor of the book “Age Proof.” Here Chatzky lays out tips for balancing saving for retirement and paying off student debts. The following is a transcript of the video.

When were choosing between any sort of either/or, when it comes to finances, you gotta look at the return on your money.

If you’re looking at, “Should I pay off my high interest rate credit cards or should I pay off my mortgage at a fairly low interest rate?” You pay off those credit cards because if the interest rate is 19.9% the return on your money for paying off that debt is 19.9%. And it’s the same when you’re evaluating paying off some sort of the debt versus a return, of potential return, on your money.

The way you got to look at retirement accounts are, “What am I getting on that money?” If you are getting matching dollars that is a no-brainer. Because that’s a guaranteed return that is going to be very, very tough to beat in any other way.

If you’re not getting matching dollars but you haven’t quite finished maxing out or putting in as much as you possibly can, I would probably just continue to invest for retirement and pay off my student loans on the schedule that I was given. That’s not to say you should pay them off on the interest rate you were given. If you haven’t looked at your portfolio of student loans and said, “Is there anything that I can do to lower the interest rate and decrease the total amount of interest that I have to pay overtime in the amount of time it’ll take me to pay off those debts?” You should absolutely do that. We can refinance student loan debt now through companies like Sofi and CommonBond and Citizens Bank. There’s a whole laundry list out there.

The one thing to be careful of, if you expected that at some point you might go into any income based repayment kind of a program on federal student loans, you can’t refi through a non-federal company and then go back into those federal repayment options.

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