I PM'd this but thought it was good general info: 45k is very good, shit I was only making 37k when I was your age and that was only 3 years ago in a better economy. I've posted this before but you should ALWAYS max out your HSA (you do mean HSA as in the one for a high deductible health plan that rolls over year to year that you keep even if you leave the company right?) which is $3,050 this year. It's literally tax free money if you use it for medical expenses and you can withdraw it penalty free after retirement for any reason, either way it's FICA tax deductible, 401k isn't. Maxing your HSA should be your number 1 investment priority if you're in a high deductible health plan, above 401k. The only other thing I can say is that there are probably monthly expenses that fly under your radar you could live without. Do you have premium movie channels? Do you go out to eat at a sit down restaurant more than once a month? Do you drop 50 bucks at the bar every Friday after work? Do you order a $10 lunch every day instead of packing one or going somewhere cheap for less than $5? Could you live in a smaller apartment for say $100/month cheaper? I wish I could help you on the loans question, but I'm not really sure. Oh, and your Avatar freaks me the fuck out.
Isn't an HSA the same thing as a Flex plan? If so, why would you want to max out an interest free account? I agree that deferring taxes is good and all, but at his age, how many health problems is he going to have? An interest free deferred flex health care plan shouldn't be maxed out, especially at his age, in my opinion.
I consolidated my student loans with Sallie Mae about 8 years ago (last time economy tanked). I went from paying $350 a month at variable interest to $135 a month. But this extended how long I was going to pay from 5 years to 15. But my interest rate was locked in at 3.6% and if you paid 48 months straight on time (which I did) they took another 1% off. Also, student loan interest is tax deductible. I have never heard of consolidating student loans hurting your credit. Student loans are considered a good loan to have on your credit report and if you have a chance to lock in these incredibly low interest rates do it. And Sallie Mae has always been great with me. They give you incentives to pay on time like the interest reduction but I have also got others. I had a 24 month paid on time reward of a $350 payment made for me. If you have any questions PM me as I did a lot of research before I consolidated mine.
An HSA is not like a flex plan. In a flex plan the money, like you said, gains no interest and on top of that you lose the money if you don't use it by March 15th of the following year, a terrible idea if you don't have fixed medical expenses. However, high deductible health plans allow for Health Savings accounts which accrue interest at a relatively high rate. They can also usually be invested in funds like a 401k as long as you have a minimum cash balance. He can let that money sit until whenever, I'm sure he'll have enough medical expenses by the time he dies. Also, it's not tax deferred (mea culpa on my first post on the matter), it's tax FREE. No, seriously, it's fucking tax free if you use it on medical expenses at any time. And it's tax deferred on the income taxes if you use it for buying a new TV or whatever after retirement, just like a 401k. On top of that it's FICA tax free no matter what you spend it on. Basic comparision: 401k: -you can invest it in funds your company offers -you can roll it to a new plan after you leave -you don't pay income taxes (except in PA) when you invest the money, you do when you withdraw -You pay FICA taxes on the money you put in the plan -There are penalties if you withdraw the money early HSA: -you can invest it in funds your company offers -you can roll it to a new plan after you leave -you don't pay income taxes ever if used for medical expenses, you pay if you use it for something else -You DON'T pay FICA taxes on the money you put in the plan or when you withdraw it -There are penalties if you withdraw the money early, unless it's used for medical expenses Like I said before, if you are in a high deductible health plan and you're not maxing this you're missing out on a tax arbitrage.