Ohio man weighing spending $60K bonus on his mortgage, second home or student loans. Dave Ramsey says it’s a no-brainer

Core Insights - A financial advisor, Dave Ramsey, emphasizes the importance of paying off student loans before other debts, labeling the decision to prioritize them as a "stupidity" that hinders financial prosperity [3][4]. Group 1: Financial Situation - An Ohio man is expecting a gross bonus of $60,000 (approximately $40,000 after taxes) and holds around $50,000 in student loan debt [1]. - The couple has two mortgages: one with a remaining balance of $80,000 at 3.6% and another with an outstanding balance of $240,000 at roughly 7% [2]. Group 2: Debt Management Strategy - Ramsey advises that the sequence of debt repayment should start with student loans, followed by the smaller mortgage, and finally refinancing the larger mortgage at a lower rate [3]. - Student loans, despite having a 5% interest rate, are seen as a significant financial burden due to their long-term nature and the impact on cash flow [4][5]. Group 3: Interest Rate Considerations - While the primary mortgage has a higher interest rate of 7%, Ramsey argues that the focus should be on the time frame for debt repayment rather than just interest rates [5][6]. - The shorter the repayment period, the less relevant interest rates become, shifting the focus to cash flow and the timeline for debt elimination [6].