If you would oblige, how about a little more Non-Investing 102? A lot has already been said to the effect of paying down debt before investing. My wife is in school, so we're borrowing from the government under their nice ''interest accrues upon disbursement" plans. By the time she graduates, we will have a California-house-sized loan that will even make the numbers Greg is working with look small.
In the meantime, we have a buffer, and are continuing to keep our accounts flat...adding money towards our savings or retirement accounts now will just hurt us later.
Perhaps the experts in here will weigh in more succinctly...
A lot of people say you should attack the loans with the highest APR first. To me, it seems like the mathematically advantageous approach is to pay down the loan with the greatest overall accrual growth.
As an example:
100*5% APR = $5/year
50*8% APR = $4/year
So you pay down the $100 loan until the annual accruals are equal (at $80) then pay them down equally, no?