Student loan payments: get advice and actual numbers here Forum

[wildhaggis]

Does anyone know when those of us who had loans prior to the current cut off date for PAYE be able to use it? I read somewhere that even we will be PAYE eligible at some point this year or next but I can't remember the exact details.

Just bumping this in case no one noticed. Being able to use PAYE as opposed to IBR is a big deal. 10 vs. 15 percent of your AGI in student loan payments.

By the end of 2015 is all I really heard. Not sure a more set in stone date is out yet.

Is this even still a thing? I seem to recall doubts being thrown around here or some other forum, maybe some article.

[horriblegb]

I saw on the news last night that our generation was putting 5% into retirement funds. We start saving around 22 (the previous generation started at 27… they said boomers started at 35). The associates I know who have with no tuition debt are plowing +10% into their retirement (be it 401k, stocks or something else). I have some debt (and I am not particularly frugal) so I am at 7.5%.

After tuition and everything else called life, are most folks here at 5% (or more/less)?

With matching? then yes (focusing on the debt before retirement, might not be the best strategy, but it is the one i like the best)

[Big Shrimpin]

2012 grad still 100k left of 200k

feels like it's never going away

it may only feel like you're halfway there, but based on increased salary and diminishing interest you're probably closer to 3/4 of the way there. keep at it. You should be done by 2016 bonus season if you want to be.

if i wasnt in MFH maybe

plus have like 10k saved so any bonus needs to go to savings

fuck...tbf i did sofi so interest rate burden is relieved and that feelz good

[Bron Burgundy]

May 2014 Grad

Debt: ~69k (partial scholarship and parents' help with living expense kept my loans relatively low)
Salary: ~65k
Payment: ~800 a month
Location: CA secondary market

I'm doing the standard 10 year plan. I thought about a refi with SOFI, but my interest rate at 6.55% right now and I wouldn't save much with the refi. Planning on paying an extra $250 a month towards the loans and saving $1k a month if I can stick to my budget.

I also owe my parents ~40k for paying my living expenses during law school, but they pretty much let me pay whatever I can afford and whenever I want to.

My loans are manageable as long as I live frugally.

[Doritos]

I saw on the news last night that our generation was putting 5% into retirement funds. We start saving around 22 (the previous generation started at 27… they said boomers started at 35). The associates I know who have with no tuition debt are plowing +10% into their retirement (be it 401k, stocks or something else). I have some debt (and I am not particularly frugal) so I am at 7.5%.

After tuition and everything else called life, are most folks here at 5% (or more/less)?

I'm at 8% but still have loans. Once those are paid off I plan on putting more like 40-50% into retirement/investments. Basically continue to live off the same amount I current am even after paying back the loans. Maximize the compounding interest and prevent too much lifestyle creep.

[IrwinM.Fletcher]

I refi'd my student loans with SOFI about a year ago and had a great experience.

This week, I closed my first home purchase and used SOFI as the lender (they recently received approval for mortgages in my state). 30 year fixed, 10% down, no PMI, no origination fees, ~4.3% rate with no points. Very easy to work with and overall an excellent experience.

I am a satisfied customer.

yeah i was very close to using SoFi for my home but they had weird rules about new construction (as most lenders do). Congrats on the new home (and 10%, which is super hard to find IMO).

i used citi private bank and got 15% down, 3.2% interest and they didn't pull my credit.

Damn dude, 3.2% w/15% down on new construction is pretty great. Grats.

[courtneylove]

Salary went from $25k to $50k this year, and IBR payments just went from $25/month to $265/month when I re-certified. FML.

[Johann]

2012 grad still 100k left of 200k

feels like it's never going away

it may only feel like you're halfway there, but based on increased salary and diminishing interest you're probably closer to 3/4 of the way there. keep at it. You should be done by 2016 bonus season if you want to be.

if i wasnt in MFH maybe

plus have like 10k saved so any bonus needs to go to savings

fuck...tbf i did sofi so interest rate burden is relieved and that feelz good

You need to focus on some savings. Bonuses/anything else above and beyond loan payment should go into savings imo.

[Johann]

Salary went from $25k to $50k this year, and IBR payments just went from $25/month to $265/month when I re-certified. FML.

Ask for a 3 month forbearance. Also, you prolly shouldn't be that "FML" about gaining $1.5k a month in after tax income and paying $240 more. Net increase of more than a K/month.

You should also make sure you are doing your taxes right. This number seems a little high if you are planning correctly. You should be sticking $5k a year in your IRA to get your AGI down and decrease your IBR. Make sure you are deducting student loan interest payments as well.

[Anonymous User]

With 145k salary paid monthly, what should I expect my actual take home per month to be after appropriate taxes are withheld. I tried finding a website to answer this question but I'm not sure if accurate.
Filing single.

[KMart]

~$104,709 without accounting for state withholdings. I'm unsure of the state you are filing within. Feel free to PM me or just post anonymous here and I can enter it into my program at work if you like.

This doesn't account for any common deductions to make your tax liability smaller and your take home pay larger.

[Anonymous User]

~$104,709 without accounting for state withholdings. I'm unsure of the state you are filing within. Feel free to PM me or just post anonymous here and I can enter it into my program at work if you like.

This doesn't account for any common deductions to make your tax liability smaller and your take home pay larger.

Thanks. I would file in Texas.

[KMart]

Ah, well there's no state income tax then. Again, it doesn't take into account any deductions to lower your liability, but as a general number it's not too bad.

[DildaMan]

Debt: 92k ( 69k currently ) ( 29k at 7.8, 40k at 6.8 )
Income: 160k
Payments: 4000/month

Trying to get mine done in 2-3 years. SO has another ~250k in med school loans.

[Johann]

Debt: 92k ( 69k currently ) ( 29k at 7.8, 40k at 6.8 )
Income: 160k
Payments: 4000/month

Trying to get mine done in 2-3 years. SO has another ~250k in med school loans.

You should refi.

[XxSpyKEx]

Salary went from $25k to $50k this year, and IBR payments just went from $25/month to $265/month when I re-certified. FML.

Why didn't you just use your 2014 tax return (AGI) to certify your IBR payments for this year? You could have kept the $25 per month payments for another year. If your employer has a 401k plan, you can dump $18k /year into that plus another $5,550 into a traditional IRA* to get your AGI down to $26,500 (which is what your payments the following year would be based off). Moreover, if your payments stay at $265 per month for the rest of this year, you can deduct up to $2,500 (assuming your IBR payments are entirely going towards interest, which they probably are if you have significant debt). So that'll bring your AGI down to $24,000, meaning your payments in 2016 will actually be lower than $25 per month.

*Although, you're probably better off paying slightly more towards your student loans and investing that $5,500 into a Roth IRA. Roth IRA will increase your AGI now, since that counts as taxable income now, but when you retire you'll have a shitload more money since you won't have to pay taxes on it then.

[lacrossebrother]

People overuse the term compound interest in here. You're not maximizing compound interest by investing early. You're getting a return on money vs. not. The way you guys write makes it seem like there's some exponential multiple applied so the rate of return is greater on $100 than $1 even with the same interest rates. The two different principals will follow a linear relationship.

[BrazilBandit]

People overuse the term compound interest in here. You're not maximizing compound interest by investing early. You're getting a return on money vs. not. The way you guys write makes it seem like there's some exponential multiple applied so the rate of return is greater on $100 than $1 even with the same interest rates. The two different principals will follow a linear relationship.

10% of 100 = 10
10% of 1 = .1

10>.1?

time maximizes return if you reinvest your earnings, which most people do...

[2014]

Any reason not to refi before I start work? One company seems to do it (competitively) with an offer letter only.

[sweeteavodka]

Does it make sense to pour money into loans or refinance if you are unsure how long you'll be in Big Law? If I'm only staying 3-5 years and then going into PSLF-eligible employment, seems like better option is to invest instead. In short: should you be certain that you are staying in the private sector long-term before choosing to pay down student loans/refi ahead of investing?

[Tiago Splitter]

Does it make sense to pour money into loans or refinance if you are unsure how long you'll be in Big Law? If I'm only staying 3-5 years and then going into PSLF-eligible employment, seems like better option is to invest instead. In short: should you be certain that you are staying in the private sector long-term before choosing to pay down student loans/refi ahead of investing?

If you are sure you'll be switching to PSLF-eligible employment then you should pay the absolute minimum towards your loans.

[sweeteavodka]

Does it make sense to pour money into loans or refinance if you are unsure how long you'll be in Big Law? If I'm only staying 3-5 years and then going into PSLF-eligible employment, seems like better option is to invest instead. In short: should you be certain that you are staying in the private sector long-term before choosing to pay down student loans/refi ahead of investing?

If you are sure you'll be switching to PSLF-eligible employment then you should pay the absolute minimum towards your loans.

Right, but what if you are unsure whether you will go public or stay private?

[Tiago Splitter]

Does it make sense to pour money into loans or refinance if you are unsure how long you'll be in Big Law? If I'm only staying 3-5 years and then going into PSLF-eligible employment, seems like better option is to invest instead. In short: should you be certain that you are staying in the private sector long-term before choosing to pay down student loans/refi ahead of investing?

If you are sure you'll be switching to PSLF-eligible employment then you should pay the absolute minimum towards your loans.

Right, but what if you are unsure whether you will go public or stay private?

Depends on how much you have in loans and what your prospects are for switching. If you aren't too sure of where you'll be and only have 80k in loans I'd just refi and pay them off. If you are pretty confident you'll do the PSLF thing and have 200k a refi makes less sense. I don't think you need to be absolutely 100% sure you'll stay in the private sector before you refi but if you think there's a chance to switch to something PSLF-eligible I'd wait a little while to see how your career looks a year from now.

[Johann]

Does it make sense to pour money into loans or refinance if you are unsure how long you'll be in Big Law? If I'm only staying 3-5 years and then going into PSLF-eligible employment, seems like better option is to invest instead. In short: should you be certain that you are staying in the private sector long-term before choosing to pay down student loans/refi ahead of investing?

If you are sure you'll be switching to PSLF-eligible employment then you should pay the absolute minimum towards your loans.

Right, but what if you are unsure whether you will go public or stay private?

Depends on debt load to figure out what kinda premium you'repaying for the insurance of keeping PSLF eligibility. Generally, I'd say stick to investing and as little towards loans as possible. But that could end up really shitty for you. We need more details.

[sweeteavodka]

Does it make sense to pour money into loans or refinance if you are unsure how long you'll be in Big Law? If I'm only staying 3-5 years and then going into PSLF-eligible employment, seems like better option is to invest instead. In short: should you be certain that you are staying in the private sector long-term before choosing to pay down student loans/refi ahead of investing?

If you are sure you'll be switching to PSLF-eligible employment then you should pay the absolute minimum towards your loans.

Right, but what if you are unsure whether you will go public or stay private?

Depends on debt load to figure out what kinda premium you'repaying for the insurance of keeping PSLF eligibility. Generally, I'd say stick to investing and as little towards loans as possible. But that could end up really shitty for you. We need more details.

Loans: $160k, avg. interest rate 6.2%
Salary: $160k
Spouse: $50k salary and $70k debt, but all hers will be PSLF and we will file separately to shield my salary from her PAYE calculation.
Likely to be a child within 12 mos.

Open to staying in firm life, but want to make sure it's right for me and family first. If I don't stay long-term, would go government. Need at least 1-2 years before I'm willing to commit to staying in private sector.