Jessuf wrote:So will PAYE never be expanded to IBR people like me? I have to start repayment in a few months.
http://bostonstudentloanlawyer.com/brea ... announced/
debuts dec 16 and guidelines are there.
Jessuf wrote:So will PAYE never be expanded to IBR people like me? I have to start repayment in a few months.
JenDarby wrote:If you're making 140k in a low cost of living place you shouldn't need to take out extra loan money at that high of a rate to afford a down payment in a couple years. I would say take out only the loans you need and then take your cash baths once you graduate. Graduating with 90k should be easy to pay off at that income while still saving tons of money.
180kickflip wrote:I haven't really done any research into how student loans (esp. at the grad level) work, but is it really possible to just choose to take out loans of like 40k when you don't "need" it for tuition? I mean, if you get a near full tuition scholarship and are just like 10k away from the expected student budget, will they really approve you for an additional 40k? I guess it's in their interest since they just get more interest and fees off of you, but it still doesn't seem too smart to give out THAT much $ when it isn't really needed for demonstrated expenses.
JohannDeMann wrote:Yeah I mean if you want the money for house and investing, max the loans and go PAYE. I would probably do that as well.
Danger Zone wrote:JohannDeMann wrote:Yeah I mean if you want the money for house and investing, max the loans and go PAYE. I would probably do that as well.
This is such stupendously terrible advice for someone that's only 60k in debt.
We get it: you like PAYE. That doesn't mean it's the answer for everyone.
ballouttacontrol wrote:So, I'm a 3L, currently at about $60k in debt, one semester left, and about $10k in my pocket. I also haven't taken any loans this year, but will need to cover COL and $27k tuition next semester. Regional law firm paying $140k ish lined up with not bad COL.
Question is, should I take out only the loan balance I need to pay tuition+COL+survive? OR, should I MAX OUT the government loans?
I will need to max out the $20.k of Stafford at 5.84% regardless. So real question is: how much should I take in GradPLUS at 6.84%?
If I dump the last of my savings and take minimum loans, I'd start working in September owing maybe $90k ish. However, I could also take out a full 1-semester gradPLUS loan of $40k instead of only $10k at 6.84%, and graduate owing, say, $120k, but have an extra $30k in my pocket to invest towards a down payment in a couple years. Then, there's also the damn 4.2% origination fee on just getting the GradPLUS loan.
Originally I was thinking I'd just find the lowest interest rate possible, and then refinancing. But now I'm really thinking about maximizing the amount liquid $$$ I have.
What do y'all think? Refinance minimum loans to low rate, or max out loans and PAYE?
lacrossebrother wrote:The down the drain expression is low iq propaganda. Any interest you pay is "down the drain" too, plus any maintenance costs. Plus the risk premium.
mylifeis24 wrote:Job: Biglaw ($160K starting)
Wife's Salary: $33K
Location: NYC
Debt: 170K from Law + UG at average weighted rate of 6.269%
Wife's Debt: 41K at average rate of 6.025%
So I've read through a decent number of posts and I see that my initial impression to pay off loans as quickly as possible may not be the best move since I lose early years to invest in IRA/401k accounts and benefit from the compound interest. I absolutely hate the thought of having looming debt, however. I also know that there is no guarantee that someone stays in biglaw for 5, 6, 7 years, but if it's a matter of willpower and fighting through each day, I'm confident I'll get through – just my personality. And as for fear of being laid off or other things mostly out of my control, my loans are all federal, so I have that set of safety nets.
I'm curious if in my scenario, it's possible to pay down my and the wife's combined debt in 6-7 years AND maximize IRA/401k? If based on a 6.5 year repayment plan, the debt would be a total of $~270K. Assuming standard biglaw salary and bonus + my wife's income of $33K, if we started off paying something like $27K our first year, then $35K, then $45K, $53K, $55K, and $55K, and I contributed max of $23.5K each year for IRA/401k, that would still be plenty to live on the first year with NYC rent (assuming something like $3.5K monthly rent) after taxes.I feel like I'm missing something here because this doesn't seem that bad at all... Really appreciate everyone's help and the wise words in this thread!
JohannDeMann wrote:mylifeis24 wrote:Job: Biglaw ($160K starting)
Wife's Salary: $33K
Location: NYC
Debt: 170K from Law + UG at average weighted rate of 6.269%
Wife's Debt: 41K at average rate of 6.025%
So I've read through a decent number of posts and I see that my initial impression to pay off loans as quickly as possible may not be the best move since I lose early years to invest in IRA/401k accounts and benefit from the compound interest. I absolutely hate the thought of having looming debt, however. I also know that there is no guarantee that someone stays in biglaw for 5, 6, 7 years, but if it's a matter of willpower and fighting through each day, I'm confident I'll get through – just my personality. And as for fear of being laid off or other things mostly out of my control, my loans are all federal, so I have that set of safety nets.
I'm curious if in my scenario, it's possible to pay down my and the wife's combined debt in 6-7 years AND maximize IRA/401k? If based on a 6.5 year repayment plan, the debt would be a total of $~270K. Assuming standard biglaw salary and bonus + my wife's income of $33K, if we started off paying something like $27K our first year, then $35K, then $45K, $53K, $55K, and $55K, and I contributed max of $23.5K each year for IRA/401k, that would still be plenty to live on the first year with NYC rent (assuming something like $3.5K monthly rent) after taxes.I feel like I'm missing something here because this doesn't seem that bad at all... Really appreciate everyone's help and the wise words in this thread!
Staying in biglaw is not a matter of willpower. Your biglaw job is out of your control for the most part and at the whims of the economy. If you are too risk averse to put all your money in the stock market and let it ride, then you are too risk averse to leave govt protected debt.
Staying in biglaw is not a matter of willpower. Your biglaw job is out of your control for the most part and at the whims of the economy. If you are too risk averse to put all your money in the stock market and let it ride, then you are too risk averse to leave govt protected debt.
mylifeis24 wrote:JohannDeMann wrote:mylifeis24 wrote:Job: Biglaw ($160K starting)
Wife's Salary: $33K
Location: NYC
Debt: 170K from Law + UG at average weighted rate of 6.269%
Wife's Debt: 41K at average rate of 6.025%
So I've read through a decent number of posts and I see that my initial impression to pay off loans as quickly as possible may not be the best move since I lose early years to invest in IRA/401k accounts and benefit from the compound interest. I absolutely hate the thought of having looming debt, however. I also know that there is no guarantee that someone stays in biglaw for 5, 6, 7 years, but if it's a matter of willpower and fighting through each day, I'm confident I'll get through – just my personality. And as for fear of being laid off or other things mostly out of my control, my loans are all federal, so I have that set of safety nets.
I'm curious if in my scenario, it's possible to pay down my and the wife's combined debt in 6-7 years AND maximize IRA/401k? If based on a 6.5 year repayment plan, the debt would be a total of $~270K. Assuming standard biglaw salary and bonus + my wife's income of $33K, if we started off paying something like $27K our first year, then $35K, then $45K, $53K, $55K, and $55K, and I contributed max of $23.5K each year for IRA/401k, that would still be plenty to live on the first year with NYC rent (assuming something like $3.5K monthly rent) after taxes.I feel like I'm missing something here because this doesn't seem that bad at all... Really appreciate everyone's help and the wise words in this thread!
Staying in biglaw is not a matter of willpower. Your biglaw job is out of your control for the most part and at the whims of the economy. If you are too risk averse to put all your money in the stock market and let it ride, then you are too risk averse to leave govt protected debt.
Fair, but lets assume for the sake of the question that I remain in biglaw for the time period discussed. Does the plan work?
JohannDeMann wrote:mylifeis24 wrote:JohannDeMann wrote:mylifeis24 wrote:Job: Biglaw ($160K starting)
Wife's Salary: $33K
Location: NYC
Debt: 170K from Law + UG at average weighted rate of 6.269%
Wife's Debt: 41K at average rate of 6.025%
So I've read through a decent number of posts and I see that my initial impression to pay off loans as quickly as possible may not be the best move since I lose early years to invest in IRA/401k accounts and benefit from the compound interest. I absolutely hate the thought of having looming debt, however. I also know that there is no guarantee that someone stays in biglaw for 5, 6, 7 years, but if it's a matter of willpower and fighting through each day, I'm confident I'll get through – just my personality. And as for fear of being laid off or other things mostly out of my control, my loans are all federal, so I have that set of safety nets.
I'm curious if in my scenario, it's possible to pay down my and the wife's combined debt in 6-7 years AND maximize IRA/401k? If based on a 6.5 year repayment plan, the debt would be a total of $~270K. Assuming standard biglaw salary and bonus + my wife's income of $33K, if we started off paying something like $27K our first year, then $35K, then $45K, $53K, $55K, and $55K, and I contributed max of $23.5K each year for IRA/401k, that would still be plenty to live on the first year with NYC rent (assuming something like $3.5K monthly rent) after taxes.I feel like I'm missing something here because this doesn't seem that bad at all... Really appreciate everyone's help and the wise words in this thread!
sure but i dont see why that changes anything. just PAYE for a year at those rates before you shove your hand all in to save 25k interest spread out over years. everyone in this thread thinking that debt is the devil needs to fix your head because it is going to cause you to make some terrible financial choices. you invested in a career. stop trying to pay it down day 1 on the job. work for a year in the job before you decide. change 27k first year to 5k and then increase the backend of those payments. the 22k delta is just saved and not wasted so it can be paid later.
mylifeis24 wrote:JohannDeMann wrote:mylifeis24 wrote:JohannDeMann wrote:mylifeis24 wrote:Job: Biglaw ($160K starting)
Wife's Salary: $33K
Location: NYC
Debt: 170K from Law + UG at average weighted rate of 6.269%
Wife's Debt: 41K at average rate of 6.025%
So I've read through a decent number of posts and I see that my initial impression to pay off loans as quickly as possible may not be the best move since I lose early years to invest in IRA/401k accounts and benefit from the compound interest. I absolutely hate the thought of having looming debt, however. I also know that there is no guarantee that someone stays in biglaw for 5, 6, 7 years, but if it's a matter of willpower and fighting through each day, I'm confident I'll get through – just my personality. And as for fear of being laid off or other things mostly out of my control, my loans are all federal, so I have that set of safety nets.
I'm curious if in my scenario, it's possible to pay down my and the wife's combined debt in 6-7 years AND maximize IRA/401k? If based on a 6.5 year repayment plan, the debt would be a total of $~270K. Assuming standard biglaw salary and bonus + my wife's income of $33K, if we started off paying something like $27K our first year, then $35K, then $45K, $53K, $55K, and $55K, and I contributed max of $23.5K each year for IRA/401k, that would still be plenty to live on the first year with NYC rent (assuming something like $3.5K monthly rent) after taxes.I feel like I'm missing something here because this doesn't seem that bad at all... Really appreciate everyone's help and the wise words in this thread!
sure but i dont see why that changes anything. just PAYE for a year at those rates before you shove your hand all in to save 25k interest spread out over years. everyone in this thread thinking that debt is the devil needs to fix your head because it is going to cause you to make some terrible financial choices. you invested in a career. stop trying to pay it down day 1 on the job. work for a year in the job before you decide. change 27k first year to 5k and then increase the backend of those payments. the 22k delta is just saved and not wasted so it can be paid later.
What would be a better allocation of that $22K?
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