Right now I'm sitting here deciding whether to do a payment plan on DH's tuition. We are given the option of paying 25% upfront and 75% in Feburary 2008. The amount of money is about $10k. So it's $2500 now and $7500 later.
However there is a fee associated with this, $50 to do this payment plan. This is a 1.3% APR to float $7500. I would prefer to do this because we are going to take out another $8500 subsidized Stafford loan. So we only have to pay $5850 for the semester instead of of $10k. And it will give the loan time to process.
Is it worth it? DH wants to completely drain our cash savings and pay for it. I don't think this a good idea. We have a lot of fluctuating income with the ESPP and stuff that I use to balance our budget. I also use the ESPP to pay for the tuition, and during the summer when we pay an extra $10k cash I find it's better to be saving all year.
DH hates the fact we have to pay $50. It drives him insane to pay "interest". It's so frustrating because I worry if we are cash poor and something happen we'll have to cash out investments and then be in dire straits.
I am not sure what we're doing but I think I'm going to win the argument. Because cash poor is never a good situation to be in.