Help me formulate a loan-repayment plan Forum

[AllDangle]

I will graduate with roughly $180k in loans, and my spouse has roughly $120k ($300k total). I am clerking for at least one year and then working in biglaw making NY-market scale in a market with no state income tax, plus market clerkship bonus ($50k). My spouse will make roughly $65-80k. How should I approach paying off our loans? All of my loans were taken out beginning in 2013, but my spouse has undergrad loans dating to 2009 but will have received loans as recent as this upcoming fall. I include this because I believe I saw that it matters when you withdrew the loans for PAYE purposes. If it matters, I aspire to go into federal government work at some point.

A few questions:

1) Is it possible to consolidate our loans together into one big 'ol ball of suck? If so, is this advisable?
2) I heard some associates at my summer firm mention refinancing their loans for a lower interest rate. How does one do this?

Now, the strategies I've come up with:

1) Live off my spouse's salary, and throw my biglaw salary at loans before I burn out or get pushed out (after maxing out 401K, IRA, home down payment fund, etc). We would live off about $70k for what, 4 years, before the entire balance is paid off? This seems simple, and since it seems simple I'm led to believe it is stupid. Is it?

. . . and that's it. I've also heard with this load PAYE is an option, pay the minimum, and start a savings account for the tax bomb after 25 years.

What is the best approach to tackle this?

[lymenheimer]

I will graduate with roughly $180k in loans, and my spouse has roughly $120k ($300k total). I am clerking for at least one year and then working in biglaw making NY-market scale in a market with no state income tax, plus market clerkship bonus ($50k). My spouse will make roughly $65-80k. How should I approach paying off our loans? All of my loans were taken out beginning in 2013, but my spouse has undergrad loans dating to 2009 but will have received loans as recent as this upcoming fall. I include this because I believe I saw that it matters when you withdrew the loans for PAYE purposes. If it matters, I aspire to go into federal government work at some point.

A few questions:

1) Is it possible to consolidate our loans together into one big 'ol ball of suck? If so, is this advisable?
2) I heard some associates at my summer firm mention refinancing their loans for a lower interest rate. How does one do this?

Now, the strategies I've come up with:

1) Live off my spouse's salary, and throw my biglaw salary at loans before I burn out or get pushed out (after maxing out 401K, IRA, home down payment fund, etc). We would live off about $70k for what, 4 years, before the entire balance is paid off? This seems simple, and since it seems simple I'm led to believe it is stupid. Is it?

. . . and that's it. I've also heard with this load PAYE is an option, pay the minimum, and start a savings account for the tax bomb after 25 years.

What is the best approach to tackle this?

I have 0 --> minimal useful advice regarding finance as far as professional advice. I am also an unmarried 0L. Living off of $65-80k would not be a bad deal. It would allow greater payments into your debt without living like paupers. No state income tax = best case scenario. Should mean that you will have decent means through 65-80k. If you have other plans, ie. house, car, etc. or want to live luxuriously (and wouldn't mind being semi-biglaw dependent for longer) you'd want to live off of your income and pay down with her income. Refinancing/consolidation is possible and would likely make your payments easier, especially if you got a better rate, but that would be a question for your loan servicer/bank. If you hate your job, I'd pay down with yours. If you like the biglaw work or won't be bothered with a longer stay, pay down with hers (and some of yours). You'll still be getting through it in ~6 years or so, you'll just have a bit more money at your disposal if you're interested in higher risk investing or want to get a house or something.

tl;dr - I don't think your strategy is stupid. It just depends what you want to do with your life, exit strategies, hobbies, etc.

[AllDangle]

Anyone else?

[Indifference]

This thread is probably the best place to ask.

[Anastasia Dee Dualla]

I will graduate with roughly $180k in loans, and my spouse has roughly $120k ($300k total). I am clerking for at least one year and then working in biglaw making NY-market scale in a market with no state income tax, plus market clerkship bonus ($50k). My spouse will make roughly $65-80k. How should I approach paying off our loans? All of my loans were taken out beginning in 2013, but my spouse has undergrad loans dating to 2009 but will have received loans as recent as this upcoming fall. I include this because I believe I saw that it matters when you withdrew the loans for PAYE purposes. If it matters, I aspire to go into federal government work at some point.

A few questions:

1) Is it possible to consolidate our loans together into one big 'ol ball of suck? If so, is this advisable? No. You cannot consolidate the loans together.
2) I heard some associates at my summer firm mention refinancing their loans for a lower interest rate. How does one do this? Refinancing through the peer to peer marketplace network has become popular as of late. I refinanced with SoFi because it offered me the lowest rate (2.91%), but DRB is also a good choice.

Now, the strategies I've come up with:

1) Live off my spouse's salary, and throw my biglaw salary at loans before I burn out or get pushed out (after maxing out 401K, IRA, home down payment fund, etc). We would live off about $70k for what, 4 years, before the entire balance is paid off? This seems simple, and since it seems simple I'm led to believe it is stupid. Is it?

. . . and that's it. I've also heard with this load PAYE is an option, pay the minimum, and start a savings account for the tax bomb after 25 years.

What is the best approach to tackle this?