Student loan payments: get advice and actual numbers here Forum

[lacrossebrother]

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

[anonnymouse]

I save more than 4k a month

Yeah so do I. The $1k/mo was hypo for the 2-3 person family on 200k and megaloans (and not doing IBR/PAYE).

ETA: the goalposts are still moving -- anyway I agree you can save more elsewhere and have an easier time while doing it. I never meant to argue otherwise. I'm still just disputing the idea you can't save in MFH.

[LA Spring]

A lot of small to mid sized firms in Southern cities tend to pay $120k starting, which isn't bad considering COL is like 1/5th the price of NYC plus a few of the states don't have income tax.

Granted I am no southern expert but anecdotally there are no small southern law firms starting at 100k and not many (if any) midsize firms pay $120k (unless they are a satellite of a BL firm). The only southern markets I know anything about are Jacksonville, Orlando and Mobile ― if you can secure 6 figs in any of these markets, jump on it!

IMO: it goes without saying that there are a lot more opportunities in the high COL places because that’s where the big firms are….that's certainly not the case in smaller COL markets.

[zot1]

A lot of small to mid sized firms in Southern cities tend to pay $120k starting, which isn't bad considering COL is like 1/5th the price of NYC plus a few of the states don't have income tax.

Granted I am no southern expert but anecdotally there are no small southern law firms starting at 100k and not many (if any) midsize firms pay $120k (unless they are a satellite of a BL firm). The only southern markets I know anything about are Jacksonville, Orlando and Mobile ― if you can secure 6 figs in any of these markets, jump on it!

IMO: it goes without saying that there are a lot more opportunities in the high COL places because that’s where the big firms are….that's certainly not the case in smaller COL markets.

I bet Atlanta associates make over 100k.

[whysoseriousbiglaw]

A lot of small to mid sized firms in Southern cities tend to pay $120k starting, which isn't bad considering COL is like 1/5th the price of NYC plus a few of the states don't have income tax.

Granted I am no southern expert but anecdotally there are no small southern law firms starting at 100k and not many (if any) midsize firms pay $120k (unless they are a satellite of a BL firm). The only southern markets I know anything about are Jacksonville, Orlando and Mobile ― if you can secure 6 figs in any of these markets, jump on it!

IMO: it goes without saying that there are a lot more opportunities in the high COL places because that’s where the big firms are….that's certainly not the case in smaller COL markets.

I bet Atlanta associates make over 100k.

Dallas, Houston, Nashville, Atlanta, Memphis, etc. pay over 100k starting. It's not that unusual.

I also interviewed back in the day in secondary markets not in the South and the firms started at around 110/120k

[A. Nony Mouse]

Granted I am no southern expert but anecdotally there are no small southern law firms starting at 100k and not many (if any) midsize firms pay $120k (unless they are a satellite of a BL firm). The only southern markets I know anything about are Jacksonville, Orlando and Mobile ― if you can secure 6 figs in any of these markets, jump on it!

There are way more southern cities than these, though.

And backing up, picking up a rental car for the weekend is actually not especially difficult.

[Anonymous User]

Granted I am no southern expert but anecdotally there are no small southern law firms starting at 100k and not many (if any) midsize firms pay $120k (unless they are a satellite of a BL firm). The only southern markets I know anything about are Jacksonville, Orlando and Mobile ― if you can secure 6 figs in any of these markets, jump on it!

There are way more southern cities than these, though.

And backing up, picking up a rental car for the weekend is actually not especially difficult.

Some Birmingham firms start at or near 6 figures

[kay2016]

Accidental anon ^

[bk1]

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.

[WhirledWorld]

Anyone have any advice on shopping mortgage lenders?

[AVBucks4239]

I feel like this is telling us more about you and your expectations than about lifestyle inflation/deflation.

Let's put it this way - NYC is one of the few places in the US where a person making a biglaw salary has the same lifestyle as a welfare mom (thank god for NYC welfare), except you actually have to work 60 hour weeks to pay for your own food and housing. Yeah you may live in a better area, but your apartment is going to be the same size and you are putting in a lot more work to live there.

You later acknowledge you are saving $4k/month because you don't want to "work until you die," and other points that seem to hint that you are pushing for early retirement/financial independence.

That's cool. I'm in a similar boat. I want to retire at age 45-47 and most people on here think I'm some combination of dumb and uninformed about how life works. I make $47,500/year and max my 401k ($18,000). My biweekly paychecks are $752. My monthly expenses are like $1,350 (including $200 of bullshit spending money), so this gives me ample room to buy stuff to fix up at my house, go out a couple times a week, and buy new clothes every once in a while.

Unlike you, though, I don't bitch about the voluntarily deflated standard of living I've imposed upon myself. I could easily reduce my 401k contributions and have $1,325 biweekly paychecks (giving me almost $1,400 in pure bullshit money per month). That would be enough to buy a new 48" flatscreen every month and live in a house 3x as large as the one I currently live in.

The point I'm trying to make, I guess, is that you need to be comfortable with your plan both for the present and the future. If saving $4k/month is making you feel like a welfare mom, then decrease your savings rate and enjoy life.

[anyriotgirl]

I feel like the ~leaving the island of manhattan~ conversation is ignoring the existence of amtrak. NE Amtrak is a great transportation method. It's fairly reasonably priced, no TSA, usually has free wifi and will get you to a lot of interesting places in close to the same time as flying, after you account for all of the getting to LGA/JFK bullshit.

[whysoseriousbiglaw]

I feel like this is telling us more about you and your expectations than about lifestyle inflation/deflation.

Let's put it this way - NYC is one of the few places in the US where a person making a biglaw salary has the same lifestyle as a welfare mom (thank god for NYC welfare), except you actually have to work 60 hour weeks to pay for your own food and housing. Yeah you may live in a better area, but your apartment is going to be the same size and you are putting in a lot more work to live there.

You later acknowledge you are saving $4k/month because you don't want to "work until you die," and other points that seem to hint that you are pushing for early retirement/financial independence.

That's cool. I'm in a similar boat. I want to retire at age 45-47 and most people on here think I'm some combination of dumb and uninformed about how life works. I make $47,500/year and max my 401k ($18,000). My biweekly paychecks are $752. My monthly expenses are like $1,350 (including $200 of bullshit spending money), so this gives me ample room to buy stuff to fix up at my house, go out a couple times a week, and buy new clothes every once in a while.

Unlike you, though, I don't bitch about the voluntarily deflated standard of living I've imposed upon myself. I could easily reduce my 401k contributions and have $1,325 biweekly paychecks (giving me almost $1,400 in pure bullshit money per month). That would be enough to buy a new 48" flatscreen every month and live in a house 3x as large as the one I currently live in.

The point I'm trying to make, I guess, is that you need to be comfortable with your plan both for the present and the future. If saving $4k/month is making you feel like a welfare mom, then decrease your savings rate and enjoy life.

I'm moving hopefully in the next year or two to somewhere much cheaper. It's more complicated than that because my spouse likes their job in NYC. If I were single, then yes, I would have moved a long time ago. When you're married, your living situation isn't just about you anymore, so I can bitch all I want. I sort of have to live here for now, but I refuse to blow my money, so I end up living a deflated lifestyle while saving some money and complain about it.

I don't think there's a point to life if you spend your entire life working, but that's just me. I think people get too wrapped up in material goods, buying a big house, etc. to understand how to really enjoy life or what matters (time, freedom, ability to do stuff when you want). Working until the age of 70 sounds so depressing to me - there is literally no point to living IMO if you spend 80% of your waking hour working and then you die to buy shit you don't need or don't have the time to use. You might as well have never been born at that point - at least being unborn you wouldn't be conscious to realize how pointless and stupid your life is.

[rustyyoda]

Is there any consensus on when it makes sense to stay on IBR making minimum payments for 25 years versus aggressively paying down debt?

For instance: Spouse 1 works in big law and is aggressively paying down debt. Should be done in 4 years. Spouse 2 is also a law grad with $200k in loans. But Spouse 2 works for a small firm. The couple lives on Spouse 1's salary with room to make Spouse 1's payments just fine, as well as saving for retirement (up to employer match right now [ie not maxing yet]) and with room to build an emergency fund (that will be done January 2017).

This means that Spouse 2 can either: 1) use virtually all of his income (call it $40k per year but it varies based on work flow and amounts collected from clients) to pay down loans. Assuming he could actually put all his income to debt, it'd be gone in roughly 5 years. 2) Make minimum IBR payments and watch the balance balloon. Use all his income as investments in retirement and savings and preparing for the eventual tax bomb.

I'm the big law lawyer in this scenario. It seems like, in talking with my spouse, it might make sense to make the minimums and just save for the eventual tax bomb in 25 years. We can use his money now to build our investments and savings. This option also seems to take into account that the best time to save is right now, rather than in 5 years (basic "time in the market" idea). We know that I won't be in big law forever, so eventually there will be a pay cut to factor in. Probably in 4-5 years. Making the minimum payment also seems to work with this eventuality the best: we'll be able to save a lot now for the eventual pay cut/job transition.

Talk to me about this scenario. What downsides am I missing to making minimum IBR payments on his loans? I know we would have to continue to file as married filing separately so that my income isn't taken into account in determining his payment. Anything else we should consider?

[AVBucks4239]

I don't think there's a point to life if you spend your entire life working, but that's just me. I think people get too wrapped up in material goods, buying a big house, etc. to understand how to really enjoy life or what matters (time, freedom, ability to do stuff when you want). Working until the age of 70 sounds so depressing to me - there is literally no point to living IMO if you spend 80% of your waking hour working and then you die to buy shit you don't need or don't have the time to use. You might as well have never been born at that point - at least being unborn you wouldn't be conscious to realize how pointless and stupid your life is.

Agree with your basic premise here. The glorification of material goods and work is comical when you stop and think about it. I'm kind of blown away when people ask "well what are you going to do with your life?!?," as if work is the defining feature (or what leads to) an enjoyable life.

I will say though, post-45 I'll probably be in my own little solo shop, but only doing stuff for family/friends. Hopefully grossing something like $40-50k/year. This will only be to give me some structure with life so I can remember what day of the week it is.

[Anonymous User]

I feel like this is telling us more about you and your expectations than about lifestyle inflation/deflation.

Let's put it this way - NYC is one of the few places in the US where a person making a biglaw salary has the same lifestyle as a welfare mom (thank god for NYC welfare), except you actually have to work 60 hour weeks to pay for your own food and housing. Yeah you may live in a better area, but your apartment is going to be the same size and you are putting in a lot more work to live there.

You later acknowledge you are saving $4k/month because you don't want to "work until you die," and other points that seem to hint that you are pushing for early retirement/financial independence.

That's cool. I'm in a similar boat. I want to retire at age 45-47 and most people on here think I'm some combination of dumb and uninformed about how life works. I make $47,500/year and max my 401k ($18,000). My biweekly paychecks are $752. My monthly expenses are like $1,350 (including $200 of bullshit spending money), so this gives me ample room to buy stuff to fix up at my house, go out a couple times a week, and buy new clothes every once in a while.

Unlike you, though, I don't bitch about the voluntarily deflated standard of living I've imposed upon myself. I could easily reduce my 401k contributions and have $1,325 biweekly paychecks (giving me almost $1,400 in pure bullshit money per month). That would be enough to buy a new 48" flatscreen every month and live in a house 3x as large as the one I currently live in.

The point I'm trying to make, I guess, is that you need to be comfortable with your plan both for the present and the future. If saving $4k/month is making you feel like a welfare mom, then decrease your savings rate and enjoy life.

Where the fuck do you live? Your monthly expenses are the rent for my shitty apartment. No loans either?

[AVBucks4239]

I feel like this is telling us more about you and your expectations than about lifestyle inflation/deflation.

Let's put it this way - NYC is one of the few places in the US where a person making a biglaw salary has the same lifestyle as a welfare mom (thank god for NYC welfare), except you actually have to work 60 hour weeks to pay for your own food and housing. Yeah you may live in a better area, but your apartment is going to be the same size and you are putting in a lot more work to live there.

You later acknowledge you are saving $4k/month because you don't want to "work until you die," and other points that seem to hint that you are pushing for early retirement/financial independence.

That's cool. I'm in a similar boat. I want to retire at age 45-47 and most people on here think I'm some combination of dumb and uninformed about how life works. I make $47,500/year and max my 401k ($18,000). My biweekly paychecks are $752. My monthly expenses are like $1,350 (including $200 of bullshit spending money), so this gives me ample room to buy stuff to fix up at my house, go out a couple times a week, and buy new clothes every once in a while.

Unlike you, though, I don't bitch about the voluntarily deflated standard of living I've imposed upon myself. I could easily reduce my 401k contributions and have $1,325 biweekly paychecks (giving me almost $1,400 in pure bullshit money per month). That would be enough to buy a new 48" flatscreen every month and live in a house 3x as large as the one I currently live in.

The point I'm trying to make, I guess, is that you need to be comfortable with your plan both for the present and the future. If saving $4k/month is making you feel like a welfare mom, then decrease your savings rate and enjoy life.

Where the fuck do you live? Your monthly expenses are the rent for my shitty apartment. No loans either?

NE Ohio. And I actually have significant loans but I'm riding the REPAYE gravy train by reducing AGI (and thus having low payments). Planning for early retirement makes REPAYE even more beneficial than it already is (gov't assumes you'll work through whole period and thus eventually just pay them back...LOL nope).

Off the top of my head my budget looks something like this:

Mortgage (w/ Insurance): $430
Food: $200
Gas: $40
Car Insurance: $65
Cell Phone: $75
DirecTV: $40
Utilities: $125
Student Loans: $190
Dry Cleaning: $28
Social/BS/Whatever: $200
Total: $1393

This obviously makes things a little tight but I already have a fully funded emergency fund. I'm working on getting a couple costs lower (might get Sling instead of DirecTV, food cost could be lower, might get a new quote for car insurance, etc.). Big things are (1) sharing house/utility costs 50/50 with girlfriend, (2) living in a small house (low mortgage payment and low utilities), and (3) having a paid off, fuel efficient car.

[Johann]

Is there any consensus on when it makes sense to stay on IBR making minimum payments for 25 years versus aggressively paying down debt?

For instance: Spouse 1 works in big law and is aggressively paying down debt. Should be done in 4 years. Spouse 2 is also a law grad with $200k in loans. But Spouse 2 works for a small firm. The couple lives on Spouse 1's salary with room to make Spouse 1's payments just fine, as well as saving for retirement (up to employer match right now [ie not maxing yet]) and with room to build an emergency fund (that will be done January 2017).

This means that Spouse 2 can either: 1) use virtually all of his income (call it $40k per year but it varies based on work flow and amounts collected from clients) to pay down loans. Assuming he could actually put all his income to debt, it'd be gone in roughly 5 years. 2) Make minimum IBR payments and watch the balance balloon. Use all his income as investments in retirement and savings and preparing for the eventual tax bomb.

I'm the big law lawyer in this scenario. It seems like, in talking with my spouse, it might make sense to make the minimums and just save for the eventual tax bomb in 25 years. We can use his money now to build our investments and savings. This option also seems to take into account that the best time to save is right now, rather than in 5 years (basic "time in the market" idea). We know that I won't be in big law forever, so eventually there will be a pay cut to factor in. Probably in 4-5 years. Making the minimum payment also seems to work with this eventuality the best: we'll be able to save a lot now for the eventual pay cut/job transition.

Talk to me about this scenario. What downsides am I missing to making minimum IBR payments on his loans? I know we would have to continue to file as married filing separately so that my income isn't taken into account in determining his payment. Anything else we should consider?

You are in my situation almost exactly. I would look into REPAYE.

[bk1]

Is there any consensus on when it makes sense to stay on IBR making minimum payments for 25 years versus aggressively paying down debt?

For instance: Spouse 1 works in big law and is aggressively paying down debt. Should be done in 4 years. Spouse 2 is also a law grad with $200k in loans. But Spouse 2 works for a small firm. The couple lives on Spouse 1's salary with room to make Spouse 1's payments just fine, as well as saving for retirement (up to employer match right now [ie not maxing yet]) and with room to build an emergency fund (that will be done January 2017).

This means that Spouse 2 can either: 1) use virtually all of his income (call it $40k per year but it varies based on work flow and amounts collected from clients) to pay down loans. Assuming he could actually put all his income to debt, it'd be gone in roughly 5 years. 2) Make minimum IBR payments and watch the balance balloon. Use all his income as investments in retirement and savings and preparing for the eventual tax bomb.

I'm the big law lawyer in this scenario. It seems like, in talking with my spouse, it might make sense to make the minimums and just save for the eventual tax bomb in 25 years. We can use his money now to build our investments and savings. This option also seems to take into account that the best time to save is right now, rather than in 5 years (basic "time in the market" idea). We know that I won't be in big law forever, so eventually there will be a pay cut to factor in. Probably in 4-5 years. Making the minimum payment also seems to work with this eventuality the best: we'll be able to save a lot now for the eventual pay cut/job transition.

Talk to me about this scenario. What downsides am I missing to making minimum IBR payments on his loans? I know we would have to continue to file as married filing separately so that my income isn't taken into account in determining his payment. Anything else we should consider?

You are in my situation almost exactly. I would look into REPAYE.

REPAYE does not allow you to use married filing jointly to avoid calculating spousal income into MAGI. For marrieds, IBR usually works out better than REPAYE.

@OP: If you plan to ride out an income-based repayment system to forgiveness, you should probably max your 401k to further reduce your payments. Generally, I think income-based versus aggressive payments really comes down to your preferences, risk tolerances, and expectations. Personally, if you guys think you can clear both your debt in 4-5 years, I might lean towards that. But that's because I value the idea of having my student loans off my back for 10-15 fewer years and would be willing to accept higher risk to make that happen. If you and your spouse are fine with the loans hanging around till forgiveness, then that's perfectly reasonable. It depends on you two.

[Johann]

Is there any consensus on when it makes sense to stay on IBR making minimum payments for 25 years versus aggressively paying down debt?

For instance: Spouse 1 works in big law and is aggressively paying down debt. Should be done in 4 years. Spouse 2 is also a law grad with $200k in loans. But Spouse 2 works for a small firm. The couple lives on Spouse 1's salary with room to make Spouse 1's payments just fine, as well as saving for retirement (up to employer match right now [ie not maxing yet]) and with room to build an emergency fund (that will be done January 2017).

This means that Spouse 2 can either: 1) use virtually all of his income (call it $40k per year but it varies based on work flow and amounts collected from clients) to pay down loans. Assuming he could actually put all his income to debt, it'd be gone in roughly 5 years. 2) Make minimum IBR payments and watch the balance balloon. Use all his income as investments in retirement and savings and preparing for the eventual tax bomb.

I'm the big law lawyer in this scenario. It seems like, in talking with my spouse, it might make sense to make the minimums and just save for the eventual tax bomb in 25 years. We can use his money now to build our investments and savings. This option also seems to take into account that the best time to save is right now, rather than in 5 years (basic "time in the market" idea). We know that I won't be in big law forever, so eventually there will be a pay cut to factor in. Probably in 4-5 years. Making the minimum payment also seems to work with this eventuality the best: we'll be able to save a lot now for the eventual pay cut/job transition.

Talk to me about this scenario. What downsides am I missing to making minimum IBR payments on his loans? I know we would have to continue to file as married filing separately so that my income isn't taken into account in determining his payment. Anything else we should consider?

You are in my situation almost exactly. I would look into REPAYE.

REPAYE does not allow you to use married filing jointly to avoid calculating spousal income into MAGI. For marrieds, but why would you want this when your other income is only 40k and you get 200k of more debt added into the picture.IBR usually works out better than REPAYE.very suspect considering REPAYE actually pays half of the interest that accrues that your payments dont cover; repaye is also 10% of discretionary rather than 15% compared to ibr. interest also capitalizes as soon as the couple gets pushed off IBR (which will happen if the wife sticks out biglaw when the IBR payment exceeds the 10 year repayment amount compared to no interest capitalization ever on REPAYE as long as you remain on REPAYE - which no reason to leave since you can overpay if you desire.

@OP: If you plan to ride out an income-based repayment system to forgiveness, you should probably max your 401k to further reduce your paymentscredited. Generally, I think income-based versus aggressive payments really comes down to your preferences, risk tolerances, and expectationsunless you are 400k in the hole and your monthly payments are something like 4k a month and your husband makes dogshit money so yoou have to pick up his slack, then you should default into REPAYE so you can also leave biglaw with a decent nest egg and investments to a lower income and not be debt-prisoned for the next 5 years. Personally, if you guys think you can clear both your debt in 4-5 years, I might lean towards thatif you think starting a life with a reduced income and having no savings to show for 5 years of biglaw is cool, then go for it. id much rather exit with 150k of $$$ and govt debt with friendly repayment terms capped at 10% of income. But that's because I value the idea of having my student loans off my back for 10-15 fewer years and would be willing to accept higher risk to make that happen. If you and your spouse are fine with the loans hanging around till forgiveness, then that's perfectly reasonable. It depends on you two.

assuming 160k or greater and 40k income split, theres a marriage bonus for filing jointly. repaye also has the govt pay some interest which there is going to be a shitload of in 400k of loans. im not going to do the math at this moment but theres no way IBR comes out ahead here.

[rustyyoda]

Thanks for the thoughts. I'm not actually even on IBR. I'm just on the 10 year standard. I'll call DoE and ask about repaye tomorrow.

[bk1]

but why would you want this when your other income is only 40k and you get 200k of more debt added into the picture. very suspect considering REPAYE actually pays half of the interest that accrues that your payments dont cover; repaye is also 10% of discretionary rather than 15% compared to ibr. interest also capitalizes as soon as the couple gets pushed off IBR (which will happen if the wife sticks out biglaw when the IBR payment exceeds the 10 year repayment amount compared to no interest capitalization ever on REPAYE as long as you remain on REPAYE - which no reason to leave since you can overpay if you desire.

assuming 160k or greater and 40k income split, theres a marriage bonus for filing jointly. repaye also has the govt pay some interest which there is going to be a shitload of in 400k of loans. im not going to do the math at this moment but theres no way IBR comes out ahead here.

I wasn't purporting to do any sort of in depth analysis as to which was better for OP's situation, merely pointing out one thing to consider. It may make sense for them to be on separate plans (e.g., lower income person on IBR, higher income on REPAYE), but OP should figure that out. I'm fine walking back my statement to "IBR sometimes works out better for marrieds" if that makes you happy (which, as a statement, clearly ignored OP's particulars).

unless you are 400k in the hole and your monthly payments are something like 4k a month and your husband makes dogshit money so yoou have to pick up his slack, then you should default into REPAYE so you can also leave biglaw with a decent nest egg and investments to a lower income and not be debt-prisoned for the next 5 years. if you think starting a life with a reduced income and having no savings to show for 5 years of biglaw is cool, then go for it. id much rather exit with 150k of $$$ and govt debt with friendly repayment terms capped at 10% of income

It's not necessarily 100% better to go the forgiveness route. Yes you have more liquidity (as you note, who wouldn't want to be sitting on 150k in cash?), but you may pay more in the long run depending on what your income level is over time. Of course liquidity is nice, but it's not some obvious slam dunk like you make it sound.

[LA Spring]

I bet Atlanta associates make over 100k.

Undoubtedly so, but Atlanta is not a low COL city, unless the comparison is against LA, NYC, DC or a few other Northern cities (Boston, Philly, etc.).

I am talking about reasonable COL markets like Louisville, Richmond, Charleston, Tulsa, Knoxville, etc. If there are medium low 6 fig openings in these markets, they are extremely rare.

[AVBucks4239]

Thanks for the thoughts. I'm not actually even on IBR. I'm just on the 10 year standard. I'll call DoE and ask about repaye tomorrow.

Copy pasting a post from a similar thread on IBR's tax implications:

I'm about to enter repayment on my law school loans and am trying to figure out the income tax implications. I understand that if I file a separate income tax return, then I can count only my own income and not include my wife's in determining my IBR payment amount. If you file jointly, your spouse's income and any student loan debt is considered as well. My wife and I will be earning roughly the same amount, so there ends up being little benefit to filing jointly going forward. However, for this year, I will only have about 3 months of income, so there would be substantial benefit to filing jointly.

My question is if my wife and I file jointly for this income tax year but intend to file separately in subsequent years, will my student loan payment payments next year be based on our joint income or only my separate income? Put another way, do I have to file separately this year to only have my income considered in calculating payment?

I don't think the details matter other than there isn't much of a tax benefit for us filing jointly in a normal year and my wife has no student loan debt but PM me if you think more details regarding income and debt would be helpful.

Thanks!

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.

So, back to basics. Your payment is 10% of discretionary income, discretionary income being defined as your adjusted gross income (AGI) minus 150% of the poverty line. Lucky for you, AGI is incredibly manipulative and you can drive it way down to keep your payments in check.

With that in mind, depending on your income, I think you're better off filing jointly and getting creative with reducing your AGI. Contribute a ton to 401ks (you can do $18,000 each). Contribute the max ($5,500 each) to traditional IRAs. Open HSAs and contribute the max ($6,650 per family). All that right there is more than $53,000 in savings that won't be considered before your PAYE payment. And you could go even further in driving it down (including 529 plans), but that's a bit more nuanced.

The above example is obviously a very high savings rate, of course, but the point is that you and your wife should work as a team to drive your collective AGI down so you can enjoy the tax benefits of filing jointly while also enjoying low student loan payments.

I could do a much more thorough analysis but the other two posters brought the big picture to light. The summary of the issue is this:

IBR: pay 15% of discretionary income instead of 10%, no interest subsidies except for subsidized loans, lose a bunch of tax deductions, but able to file separately and exclude spouse's income.

REPAYE: pay 10% of discretionary income, 50% of unpaid interest subsidized for all loans, able to use tax deductions from filing jointly, but spouse's income is included.

Run the numbers.

[krads153]

I bet Atlanta associates make over 100k.

Undoubtedly so, but Atlanta is not a low COL city, unless the comparison is against LA, NYC, DC or a few other Northern cities (Boston, Philly, etc.).

I am talking about reasonable COL markets like Louisville, Richmond, Charleston, Tulsa, Knoxville, etc. If there are medium low 6 fig openings in these markets, they are extremely rare.

ATL is low COL compared to Seattle, Portland, Phoenix, Denver, San Diego, Salt Lake, Chicago, pretty much any Northwest, Mountain region, West Coast, Southwest, East Coast, city. Sure, some other Southern and Midwestern cities may be cheaper, but it's pretty damn low COL.