Student loan payments: get advice and actual numbers here Forum

[JenDarby]

^ I currently accrue 500-600 less a month in interest post refi.

I was nearly certain that somehow I would pay off all my loans, so it made complete sense for my situation and goals. I don't make biglaw momey and I still manage to pay rent, pay my loans, and put money into my 401k. The rub is I currently have next to zero spending money after all of that, but I don't really go out or have expensive hobbies anyway so it's fine for me.

[anon919]

When y'all talk about refinancing, you're talking about private loans, right?

Nope. Refi'd my federal loans at SoFi. It's a great decision if you plan to pay them off ASAP on a big law salary anyway.

I'm not sure I'd agree. If you plan to pay your loans off ASAP (like in 1-3 years) refinancing will probably end up saving you only a modest sum - but if your plan to pay off ASAP doesn't work out for whatever reason, then you lose federal loan protection options.

Eh, the difference between a grad plus interest rate and a sofi interest rate can save you thousands of dollars a year.

This. I knew I had to refinance when I received my 1098-T and saw just how much I had expended on interest in 2015 alone.

[Anonymous User]

Debt: about $110,000 (walked away from law school: $85,000)
Payments: ~$4,000 or $5,000/mo + bonus
Income: $160,000 (first year salary)
Important info: Work in biglaw in NY; worked TA jobs during law school; had 2 summers of big-law (threw in everything to loans); put advance into loans. Started firm job in September 2014. Finished paying off loans on December 31, 2015. Did not re-finance.

[Anonymous User]

Debt: about $110,000 (walked away from law school: $85,000)
Payments: ~$4,000 or $5,000/mo + bonus
Income: $160,000 (first year salary)
Important info: Work in biglaw in NY; worked TA jobs during law school; had 2 summers of big-law (threw in everything to loans); put advance into loans. Started firm job in September 2014. Finished paying off loans on December 31, 2015. Did not re-finance.

Congrats on being done with loans. Do you mind sharing your rent/living expenses over the course of the year? Any advice based on your experience paying down loans so quickly?

I have about 60k left (after refinancing to ~3% and a starting loan balance of 70k) as a biglaw first year. Trying to determine whether I aggressively pay down (which it seems like you did) or invest the extra money. I think the psychological impact definitely gets to me whenever I see the balance remaining but I'm pretty sure investing is a long-term better move because of my 3% interest rate.

[marisacb1012]

Is it a bad idea to attend BU Law on a $25,000 per year scholarship? I want to get into public interest and definitely plan to pursue loan forgiveness (either from BU or the fed govt). I recognize that even this decent scholarship will leave me with 100,000+ in debt, and that worries me. Also looking at a full ride to Temple, but I wouldn't want to stay to practice in Philly, and I know Temple doesn't have as far of a geographical reach as BU. PSLF seems like a great way to make these loans more manageable. Does anyone who has taken on six figures of debt but worked in public interest and done PSLF recommend this or absolutely warn against it?

[hairbear7]

Is it a bad idea to attend BU Law on a $25,000 per year scholarship? I want to get into public interest and definitely plan to pursue loan forgiveness (either from BU or the fed govt). I recognize that even this decent scholarship will leave me with 100,000+ in debt, and that worries me. Also looking at a full ride to Temple, but I wouldn't want to stay to practice in Philly, and I know Temple doesn't have as far of a geographical reach as BU. PSLF seems like a great way to make these loans more manageable. Does anyone who has taken on six figures of debt but worked in public interest and done PSLF recommend this or absolutely warn against it?

You should make your own thread to get advice on picking a school. You'll get a wider range of input, and 0L's aren't supposed to post here.

[Anonymous User]

total law school debt: $83k
Salary: $120k
Monthly payment on 10-year plan: $938

I am paying $4,000 a month on my loans right now (my monthly take home is $7,000) - just graduated in May. I've got the balance down to $64k. I planned to have about $20k more already thrown at them but decided to buy a house shortly after graduating which I put 5% down on.

The most difficult part of the student loan situation is the other pressures - like when to buy the house or to have kids - I was a little older when I went to law school and it becomes harder with each passing year to put off living and stay focused on building a career and putting myself in a stronger financial position.

That said for my market I am very grateful for the job I have, and compared to my earning potential of my former career I'm in a much better spot and I am content with my decision to go to law school

[Anonymous User]

Apart from rates, anyone have any reasons that they prefer a certain loan refinance provider? (SoFi, Commonbond, DRB, etc.). Looking to refinance very soon, and have gotten comparable rate quotes from a few different lenders. Any insight is appreciated.

[JenDarby]

Pick solely based on loan terms. That being said, commonbond was a lot more friendly than sofi during the process IME, but if sofi had offered me better loan terms they still would have been the clear choice.

Commonbond hosts these free dinners ones every couple months (at least in NYC) at nice restaurants where I guess you can go eat with other graduates drowning in debt. I've never gone, but if you're into that kind of free food forced misery then commonbond might be for you.

[Anonymous User]

120k in loans
- Doing IBR (monthly about a $250 payment)
- Enrolled in PSLF (2/10 years done)

$52k salary (Approx. $3,700 a month after taxes)
- $500 a month goes into a a deferred compensation account (currently sitting at $8k)
- just opened a Roth IRA last fall and put $5,500 into it.
- I chose the pension option instead of the 401k so I won't vest for a few more years.

I never intended on doing anything but public service and was going to do PSLF - knew that all through law school.

Should I change anything about my payment plan? My goal was to pay as little as possible and wait the 10 years out, while also putting what I could in a pre-tax account. Due to recent events I've come into $30,000. Would it be worth it to pay down loans and actively try to pay them off? Right now the $ has just been sitting in my savings. Thoughts?

[everythingbagel]

.

[grand inquisitor]

120k in loans
- Doing IBR (monthly about a $250 payment)
- Enrolled in PSLF (2/10 years done)

$52k salary (Approx. $3,700 a month after taxes)
- $500 a month goes into a a deferred compensation account (currently sitting at $8k)
- just opened a Roth IRA last fall and put $5,500 into it.
- I chose the pension option instead of the 401k so I won't vest for a few more years.

I never intended on doing anything but public service and was going to do PSLF - knew that all through law school.

Should I change anything about my payment plan? My goal was to pay as little as possible and wait the 10 years out, while also putting what I could in a pre-tax account. Due to recent events I've come into $30,000. Would it be worth it to pay down loans and actively try to pay them off? Right now the $ has just been sitting in my savings. Thoughts?

i think you could make better uses of the 30k but it depends on if that makes enough of a chunk to make you paying off your loans yourself be a net financial gain over stringing your payments over 10 years at the minimum and banking on forgiveness.

[JenDarby]

Woah. Don't pay down your loans yet. If you're worried about leaving a PSLF job then it's an eventual consideration, but just stick the money in a CD or something and ride it out a while. If you do hit PSLF it would be silly to pay off 30k of loans.

Are you eligible for PAYE? If you are you should switch and lower your payments to pay the absolutely minimum.

[Anonymous User]

Salary:
$185,000/yr in biglaw (though probably not staying longer than another year)
Approximately $9,000/mo after taxes/deductions

Loans:
Graduated with $220,000 (largely law school debt)
Down to $118,000 (paid $90k last year)
Current loans approx $610/mo (includes portion as HELOC so that I get the tax deduction and lower monthly payment)

Housing and other expenses:
Bought a house a few years ago and rent out a portion of it, which brings down my housing expense to approximately $200/mo (including prop tax, insurance, utilities)
I live pretty frugally and live on about $1000/mo

Total monthly expenses approx $1800/mo or $21,600/year.

The key for me was taking the risk to buy property early on and build up that passive income. I'm hoping to save up as much as possible over the next year (possibly to pay off more debt or buy a second property), and then evaluate options for what I want to do with my career.

[mvp99]

Salary:
$185,000/yr in biglaw (though probably not staying longer than another year)
Approximately $9,000/mo after taxes/deductions

Loans:
Graduated with $220,000 (largely law school debt)
Down to $118,000 (paid $90k last year)
Current loans approx $610/mo (includes portion as HELOC so that I get the tax deduction and lower monthly payment)

Housing and other expenses:
Bought a house a few years ago and rent out a portion of it, which brings down my housing expense to approximately $200/mo (including prop tax, insurance, utilities)
I live pretty frugally and live on about $1000/mo

Total monthly expenses approx $1800/mo or $21,600/year.

The key for me was taking the risk to buy property early on and build up that passive income. I'm hoping to save up as much as possible over the next year (possibly to pay off more debt or buy a second property), and then evaluate options for what I want to do with my career.

where you at? My guess is TX.

[Anonymous User]

Not in TX. In major secondary market (think DC/Chicago/Boston).

[Anonymous User]

Biglaw associate: A senior junior/low midlevel salary
Loans (started out at repayment): ~190k
Paid off a little while ago.
Personal liquid savings/invested/401k: Around 130k total (roughly split three ways) (obviously 401k hasn't been taxed yet so it's a little misleading). (My spouse works too, but only has like $30k saved up but never had debt.)
Primary expensive market.

My portion of the rent starting out for my first year was like $500 or less bucks as I commuted. I threw down heavily into loans. Then it was $1000. Now I pay around $1200 per month. I've always lived with my spouse though and/or had roommates. Commuting and living cheap was worth it IMO, although I had a rough couple of years hours wise.

Long term plan is to move somewhere much cheaper, and possibly leave law....

[Stringer6]

These numbers are sobering. Thank you to everyone who posted.
For those of you who are BigLaw associates in New York with loans, do you mind saying how much you spend in rent a month? Given that people are paying $1,500 to $2,000 a month towards loans, it can't be too easy to find a reasonably-priced apartment in New York, at least if you want to live alone.

$1,575 in outer borough

[JenDarby]

These numbers are sobering. Thank you to everyone who posted.
For those of you who are BigLaw associates in New York with loans, do you mind saying how much you spend in rent a month? Given that people are paying $1,500 to $2,000 a month towards loans, it can't be too easy to find a reasonably-priced apartment in New York, at least if you want to live alone.

$1,575 in outer borough

holy shit you still exist

[BrittaBot]

120k in loans
- Doing IBR (monthly about a $250 payment)
- Enrolled in PSLF (2/10 years done)

$52k salary (Approx. $3,700 a month after taxes)
- $500 a month goes into a a deferred compensation account (currently sitting at $8k)
- just opened a Roth IRA last fall and put $5,500 into it.
- I chose the pension option instead of the 401k so I won't vest for a few more years.

Your salary is technically $10k less than mine but somehow I only come home with $200 more total a month after taxes. Taxed much?

But seriously how is that even possible?

[Stringer6]

These numbers are sobering. Thank you to everyone who posted.
For those of you who are BigLaw associates in New York with loans, do you mind saying how much you spend in rent a month? Given that people are paying $1,500 to $2,000 a month towards loans, it can't be too easy to find a reasonably-priced apartment in New York, at least if you want to live alone.

$1,575 in outer borough

holy shit you still exist

can't resist an opportunity to brag about my low rent

[Pokemon]

If interest capitalization is not an issue, is there a point for a 2014 graduate to stay on IBR instead of moving to repaye.

[El Pollito]

if you're on IBR and come out of partial financial hardship and get your interest capitalized, it's just the current "unpaid interest" figure on your subsidized loans on fedloan's website right? or is it something else?

[Johann]

if you're on IBR and come out of partial financial hardship and get your interest capitalized, it's just the current "unpaid interest" figure on your subsidized loans on fedloan's website right? or is it something else?

correct that moves into the loan balance

[Johann]

If interest capitalization is not an issue, is there a point for a 2014 graduate to stay on IBR instead of moving to repaye.

no.