Student loan payments: get advice and actual numbers here Forum

[Companion Cube]

I'd say that having to go to fucking Avis just to leave for the weekend is material.

It just doesn't make sense to me to pay the costs of car ownership (insurance, parking, car itself, depreciation costs) when you use a car only infrequently.

Anywhere with good public transportation, a car is a luxury.

I ditched my car as well. Turns out public transportation + the occasional uber when I'm in a hurry ends up being much cheaper than maintaining a car and parking it in Chicago. Plus it's nice not having to worry about it in the cold or if a sweeper is going to come by.

[JenDarby]

When my SOs car was sideswiped and in the shop we realized that with insurance, NYC parking, car payments, tolls, gas etc. that it woukd actually be cheaper for him to just uber back and forth from work everyday (his office wasn't reachable by any convenient public transit).

[Companion Cube]

Relatedly, I feel more confident in my decision every time I go outside and see someone trying to parallel park in a space half the size of their car and only finally give up when they actually hit one of the parked cars. I used to try to get license plates when people drove off but I guess I'm jaded now or something.

[bk1]

I'm very pro-PAYE but I think you're significantly marginalizing the consequences of filing jointly vs. separately compounded over 20/25 years. No student loan interest deduction, no married deduction, no child tax credit, no dependent care credit (if you hire a babysitter), no being able to contribute to a traditional IRA, etc.

For example, the student loan interest deduction is $2,500 per year. Multiply that by two if your wife needs it too. That's $5,000 per year for as long as you qualify (and the cap should continue to get adjusted for inflation). Say you qualify for ten years...$5,000 credit x 10 years x .25 = $12,500 in refunds. Child care dependent credit is $750 refund per year. Married credit is $2,000 per year in refunds. On and on and on...multiply them all out by the entire 20 year period and it's a ton of tax savings that you're throwing out the window.

To be fair, a lot of people considering this choice (MFJ vs MFS) are phased out of a lot of those (e.g., trad IRA, student loan interest deduction, etc).

[rustyyoda]

I'm very pro-PAYE but I think you're significantly marginalizing the consequences of filing jointly vs. separately compounded over 20/25 years. No student loan interest deduction, no married deduction, no child tax credit, no dependent care credit (if you hire a babysitter), no being able to contribute to a traditional IRA, etc.

For example, the student loan interest deduction is $2,500 per year. Multiply that by two if your wife needs it too. That's $5,000 per year for as long as you qualify (and the cap should continue to get adjusted for inflation). Say you qualify for ten years...$5,000 credit x 10 years x .25 = $12,500 in refunds. Child care dependent credit is $750 refund per year. Married credit is $2,000 per year in refunds. On and on and on...multiply them all out by the entire 20 year period and it's a ton of tax savings that you're throwing out the window.

To be fair, a lot of people considering this choice (MFJ vs MFS) are phased out of a lot of those (e.g., trad IRA, student loan interest deduction, etc).

Yup. We have no kids (and won't for at least 5+ years assuming no birth control failure), I can get the student loan interest deduction this year but not next year (or any year subsequent to that in which I'm in big law), I wouldn't contribute to a traditional IRA until I could afford to max my 401k (not happening until I build the emergency fund).

I don't have my W2 to run the numbers, but I'm suspecting it won't be a massive difference this year.

[JenDarby]

I didn't realize how severe the 2015 student loan interest deduction phaseout was:

Student Loan Interest Deduction. For 2015, the maximum amount that you can take as a deduction for interest paid on student loans remains at $2,500. Phaseouts apply for taxpayers with modified adjusted gross income (MAGI) in excess of $65,000 ($130,000 for joint returns), and is completely phased out for taxpayers with modified adjusted gross income (MAGI) of $80,000 or more ($160,000 or more for joint returns).

[Big_Law_Brit_Slave]

Hi all,

I'm not a US lawyer, nor attending a US law school. I am a UK qualified lawyer working in biglaw.

I recently stumbled across this thread and found it both shocking and fascinating. I can't believe some of the debt levels you guys have to take to get qualified. Its a fking scandal.

In the UK, the system is entirely different. We only have to start repaying our loans if we are earning over $30,000. Whatever we make over $30,000 we pay 9% back. For example, a graduate earning $45,000 p/a would pay back c.$200 per month. If you stop working, you don't have to pay your loans. Also, the interest rates on our loans are linked to the Bank of England's base rate (i.e. 0.5%).

You guys need to advocate change. Your government is literally enslaving you.

Best of luck to all of you.

UK biglaw slave.

[Anonymous User]

Hi all,

I'm not a US lawyer, nor attending a US law school. I am a UK qualified lawyer working in biglaw.

I recently stumbled across this thread and found it both shocking and fascinating. I can't believe some of the debt levels you guys have to take to get qualified. Its a fking scandal.

In the UK, the system is entirely different. We only have to start repaying our loans if we are earning over $30,000. Whatever we make over $30,000 we pay 9% back. For example, a graduate earning $45,000 p/a would pay back c.$200 per month. If you stop working, you don't have to pay your loans. Also, the interest rates on our loans are linked to the Bank of England's base rate (i.e. 0.5%).

You guys need to advocate change. Your government is literally enslaving you.

Best of luck to all of you.

UK biglaw slave.

True statements re debt slaves. BUT Student loans are more flexible than this thread can make it seem. We could make the same statements re not having to repay loans until making over a threshold amount because of income based repayment options that take 10% over a certain level of income. We also get deferments/forbearance due to job losses or other temporary income hiccups. Most schools also have repayment assistant for those working in public interest such that they end up not paying much on loans.

The real crime though is the cost of tuition (interest rates seem pretty high too, but honestly they would be even higher without the govt subsidies). 200K for a law degree is absurd. Of course, unlimited federal loan money bears a large part of the blame for this.

[Tiago Splitter]

Hi all,

I'm not a US lawyer, nor attending a US law school. I am a UK qualified lawyer working in biglaw.

I recently stumbled across this thread and found it both shocking and fascinating. I can't believe some of the debt levels you guys have to take to get qualified. Its a fking scandal.

In the UK, the system is entirely different. We only have to start repaying our loans if we are earning over $30,000. Whatever we make over $30,000 we pay 9% back. For example, a graduate earning $45,000 p/a would pay back c.$200 per month. If you stop working, you don't have to pay your loans. Also, the interest rates on our loans are linked to the Bank of England's base rate (i.e. 0.5%).

You guys need to advocate change. Your government is literally enslaving you.

Best of luck to all of you.

UK biglaw slave.

True statements re debt slaves. BUT Student loans are more flexible than this thread can make it seem. We could make the same statements re not having to repay loans until making over a threshold amount because of income based repayment options that take 10% over a certain level of income. We also get deferments/forbearance due to job losses or other temporary income hiccups. Most schools also have repayment assistant for those working in public interest such that they end up not paying much on loans.

The real crime though is the cost of tuition (interest rates seem pretty high too, but honestly they would be even higher without the govt subsidies). 200K for a law degree is absurd. Of course, unlimited federal loan money bears a large part of the blame for this.

Nah man we need to advocate for more government help to get even more people into law school.

[lacrossebrother]

Hi all,

I'm not a US lawyer, nor attending a US law school. I am a UK qualified lawyer working in biglaw.

I recently stumbled across this thread and found it both shocking and fascinating. I can't believe some of the debt levels you guys have to take to get qualified. Its a fking scandal.

In the UK, the system is entirely different. We only have to start repaying our loans if we are earning over $30,000. Whatever we make over $30,000 we pay 9% back. For example, a graduate earning $45,000 p/a would pay back c.$200 per month. If you stop working, you don't have to pay your loans. Also, the interest rates on our loans are linked to the Bank of England's base rate (i.e. 0.5%).

You guys need to advocate change. Your government is literally enslaving you.

Best of luck to all of you.

UK biglaw slave.

The fixed to the bank rate thing is tremendous. But other than it's pretty similar. our system is we don't need to pay back if we're making below $17.5k. We pay back 10% what we make above that, but have the opportunity to reduce our reportable income by $23.5k if we put that in retirement. There's also little deductions here and there (i.e. Health, transport, etc). So a person making $60k a year should be paying back about $2k a year.

[lacrossebrother]

Hi all,

I'm not a US lawyer, nor attending a US law school. I am a UK qualified lawyer working in biglaw.

I recently stumbled across this thread and found it both shocking and fascinating. I can't believe some of the debt levels you guys have to take to get qualified. Its a fking scandal.

In the UK, the system is entirely different. We only have to start repaying our loans if we are earning over $30,000. Whatever we make over $30,000 we pay 9% back. For example, a graduate earning $45,000 p/a would pay back c.$200 per month. If you stop working, you don't have to pay your loans. Also, the interest rates on our loans are linked to the Bank of England's base rate (i.e. 0.5%).

You guys need to advocate change. Your government is literally enslaving you.

Best of luck to all of you.

UK biglaw slave.

True statements re debt slaves. BUT Student loans are more flexible than this thread can make it seem. We could make the same statements re not having to repay loans until making over a threshold amount because of income based repayment options that take 10% over a certain level of income. We also get deferments/forbearance due to job losses or other temporary income hiccups. Most schools also have repayment assistant for those working in public interest such that they end up not paying much on loans.

The real crime though is the cost of tuition (interest rates seem pretty high too, but honestly they would be even higher without the govt subsidies). 200K for a law degree is absurd. Of course, unlimited federal loan money bears a large part of the blame for this.

tuition would be lower without gov subsidies.

[Anonymous User]

Hi all,

I'm not a US lawyer, nor attending a US law school. I am a UK qualified lawyer working in biglaw.

I recently stumbled across this thread and found it both shocking and fascinating. I can't believe some of the debt levels you guys have to take to get qualified. Its a fking scandal.

In the UK, the system is entirely different. We only have to start repaying our loans if we are earning over $30,000. Whatever we make over $30,000 we pay 9% back. For example, a graduate earning $45,000 p/a would pay back c.$200 per month. If you stop working, you don't have to pay your loans. Also, the interest rates on our loans are linked to the Bank of England's base rate (i.e. 0.5%).

You guys need to advocate change. Your government is literally enslaving you.

Best of luck to all of you.

UK biglaw slave.

Let's all not be so cavalier using the word "slave." We all went to law school voluntarily. Actually slaves, past and present, had no choice in the matter.

[Anonymous User]

Hi all,

I'm not a US lawyer, nor attending a US law school. I am a UK qualified lawyer working in biglaw.

I recently stumbled across this thread and found it both shocking and fascinating. I can't believe some of the debt levels you guys have to take to get qualified. Its a fking scandal.

In the UK, the system is entirely different. We only have to start repaying our loans if we are earning over $30,000. Whatever we make over $30,000 we pay 9% back. For example, a graduate earning $45,000 p/a would pay back c.$200 per month. If you stop working, you don't have to pay your loans. Also, the interest rates on our loans are linked to the Bank of England's base rate (i.e. 0.5%).

You guys need to advocate change. Your government is literally enslaving you.

Best of luck to all of you.

UK biglaw slave.

True statements re debt slaves. BUT Student loans are more flexible than this thread can make it seem. We could make the same statements re not having to repay loans until making over a threshold amount because of income based repayment options that take 10% over a certain level of income. We also get deferments/forbearance due to job losses or other temporary income hiccups. Most schools also have repayment assistant for those working in public interest such that they end up not paying much on loans.

The real crime though is the cost of tuition (interest rates seem pretty high too, but honestly they would be even higher without the govt subsidies). 200K for a law degree is absurd. Of course, unlimited federal loan money bears a large part of the blame for this.

tuition would be lower without gov subsidies.

If cost-reduction is the chief priority, there are many possible policies to advocate for:

First, the government could make its loans eligible for attendance only at those schools who cap or limit the increases in their tuition.

Alternatively, the government could stop making loans altogether. Let schools themselves loan out the money. Then schools would actually have an incentive to make sure everyone got a good job.

A third possibility is to ban price discrimination. Require schools to charge the same amount from each student. Tuition is very high for some students in order to cover the full scholarships of other students.

[Phil Brooks]

Accidental anon above two.

[Anonymous User]

Has anyone heard of biglaw firms offering some sort of student loan consolidation deal with a bank? I heard Latham offers it to its associates. Is this commonplace? If anyone has any knowledge of this, what interest rate is the consolidated loan?

[Phil Brooks]

Has anyone heard of biglaw firms offering some sort of student loan consolidation deal with a bank? I heard Latham offers it to its associates. Is this commonplace? If anyone has any knowledge of this, what interest rate is the consolidated loan?

Law firms do this in order to erode any shred of leverage the associate would have over it. Do you really want to be an employee AND debtor to a single firm?

[LA Spring]

Curious. What percentage of your net pay goes toward tuition debt?

As an FYI, I pay 20%-25%...I could pay less but I want to pay it off ASAP (I have cut it nearly in half since starting work). Due to scholarships mine was under six figures.

[Anonymous User]

Curious. What percentage of your net pay goes toward tuition debt?

As an FYI, I pay 20%-25%...I could pay less but I want to pay it off ASAP (I have cut it nearly in half since starting work). Due to scholarships mine was under six figures.

Using net as after taxes/healthcare, but before 401k. ~40% of my pay, ~30% of my + spouse's pay.

[HmmmOkay]

Based on what I've seen in this thread, is it safe to say that payment on 60-70k of student loans means paying 600-700 per month?

Thanks!

[Johann]

4% or so net after taxes and all that. fuck them loans.

[A. Nony Mouse]

Based on what I've seen in this thread, is it safe to say that payment on 60-70k of student loans means paying 600-700 per month?

Thanks!

You should google "student loan repayment calculator" or go here: https://studentloans.gov/myDirectLoan/m ... tor.action - it will give you a much clearer idea of what your payments would be.

[Big_Law_Brit_Slave]

Hi all,

I'm not a US lawyer, nor attending a US law school. I am a UK qualified lawyer working in biglaw.

I recently stumbled across this thread and found it both shocking and fascinating. I can't believe some of the debt levels you guys have to take to get qualified. Its a fking scandal.

In the UK, the system is entirely different. We only have to start repaying our loans if we are earning over $30,000. Whatever we make over $30,000 we pay 9% back. For example, a graduate earning $45,000 p/a would pay back c.$200 per month. If you stop working, you don't have to pay your loans. Also, the interest rates on our loans are linked to the Bank of England's base rate (i.e. 0.5%).

You guys need to advocate change. Your government is literally enslaving you.

Best of luck to all of you.

UK biglaw slave.

The fixed to the bank rate thing is tremendous. But other than it's pretty similar. our system is we don't need to pay back if we're making below $17.5k. We pay back 10% what we make above that, but have the opportunity to reduce our reportable income by $23.5k if we put that in retirement. There's also little deductions here and there (i.e. Health, transport, etc). So a person making $60k a year should be paying back about $2k a year.

...The same apart from my tuition fees (Oxbridge) were $4,000 p/a. So my overall student debt is c.$20,000. At the time, we were all up-in-arms in taking on this sort of debt! The previous university generations paid a measly $,1,400 p/a.

The truth is we are all paying for a badge. The actual value we get from lectures/seminars etc, even at top law schools, isn't worth $200,000 (plus whatever you pay back in interest).

[zot1]

I only pay about 10 dollars per month

[Big_Law_Brit_Slave]

I only pay about 10 dollars per month

Correct me if I'm wrong, but student debt is not "forgiven" by the US government after a certain period? In the UK, all debt is "forgiven" if it is not paid within 30 years.

Also, I read something on here about some students fearing a "tax bomb" when they retire? Can someone explain?

[gk101]

I only pay about 10 dollars per month

Correct me if I'm wrong, but student debt is not "forgiven" by the US government after a certain period? In the UK, all debt is "forgiven" if it is not paid within 30 years.

Also, I read something on here about some students fearing a "tax bomb" when they retire? Can someone explain?

the debt is forgiven after 20 (or 25 on IBR i think) years but it is treated as a taxable event so you owe taxes on the amount forgiven