Student loan payments: get advice and actual numbers here Forum

[QContinuum]

Yes, Basile's postings ITT were inappropriate, especially after multiple warnings and a previous three-day ban which just expired. Basile is banned again, this time for a week. Will go straight to perma ban next time if the week-long ban doesn't work.

[rcharter1978]

Whatever happened to you in life, you have my apologies. It doesn't sound like you're in a good situation. You also make sweeping judgments that are totally unfounded, but that tends to happen when you yourself are in a tight spot. Oh well...

As long as I'm making progress, then the debt is more than worth it. You can't have one without the other when it comes to law school (unless mommy and daddy are rich and paying for your education with that silver spoon). FICO score is very relevant, especially when you want to get approved for apartment rentals among other things. And who said that 99% of people are rejected from student loan forgiveness? That's a bunch of hogwash. Any rejection from that means that they are doing something wrong and not keeping on top of things, so only they themselves are to blame. Fortunately, I'm a very punctilious type of person, and you should not be going into law if you're not that type of personality (just my opinion).

By the way, if somebody is technically unemployed for 20 to 25 years (hypothetically, hopefully not realistically) while the monthly payments are $0/month, your debt will be forgiven when those 20 years are up (depending on the repayment plan). Paying $0 a month does indeed count as a monthly payment. And guess what? These $0 monthly payments actually help your credit score!!! And just to show you that you're rather uneducated about saying FICO scores are irrelevant, you actually need a good credit score to get approved for GradPLUS loans, auto loans, etc. From my experiences, they don't take your student loan debt into consideration at all when considering renting an apartment out or other things. Please get an education on this. Thanks.

There is a lot of bad information in this post, but for future law students, be aware that there is a good chance PSLF is going to be limited or completely eradicated.

I read an article the other day that indicated that a LOT of people on PSLF are using the program to forgive debt on high priced graduate degrees. This leaves the government forgiving much more debt than was initially contemplated.

The Obama administration tried to cap the amount of PSLF forgiveness at $57,000 but it didn't get through Congress.

The current administration is now just making it difficult to get into the program. It's not just a matter of "staying on top of things" it's multiple denials, stalling, asking for more information and doing as much as they can to frustrate the applicant.

I think it's still hard to deny someone who is working for the government, but working for a nonprofit is probably more difficult.

Just be wary if you're thinking of PSLF. I also think that PSLF has probably made the competition for government jobs a little more fierce.

[Anonymous User]

Income: 4th year biglaw associate at market.
Debt: Started at ~120K, now at ~80K.
Interest: Refinanced, so interest at 3.35%
All liquid savings: 110K
--
Given the low interest rate, I'm wondering, is it wrong of me to consider just paying off the rest of my loans rather quickly (particularly with bonuses coming up)? Honestly, too busy / lazy to invest that would beat the 3.35% guaranteed return (unless I'm sufficiently scolded for not investing).

Ultimately, for next big move, looking to save enough for downpayment on a mortgage (for long-term).

Shockingly still happy in BigLaw so I don't foresee any drastic income changes.

Any thoughts would be much appreciated.

[The Lsat Airbender]

Laziness is a bad reason not to invest nowadays - literally just put it all in VSTAX or something. On the other hand, I'm a big fan of paying debt down ahead of time, too, for psychological reasons, and 3.35% isn't crazy low. And getting debt-free will help with your medium-term goal of buying a home. The math says invest but reasonable people could choose to pay off debt in your shoes.

Definitely don't just leave $110k in bank accounts unless you need an unusually-large emergency fund for some reason. 6 months' expenses is plenty.

[Anonymous User]

Finally at the halfway point:

At graduation:
$0 Savings/liquid investments
$0 Retirement
$245K student loans

After 3 years big law
~$145K savings/liquid investments
$100K+ retirement
$122.5K student loans

Didn’t even really live frugally—have gone on expensive vacations every year and live in a nice place.

Could have obviously put more towards loans and less toward retirement but yeahhh that would have been dumb, the stock market returns have been insane over the past three years obviously. Will throw 4th bonus at them and have them paid off sometime in 2021. In the meantime, will keep beating that low interest right by stashing money in retirement and investments. At this point, even if the stock market retracts a bit, still easily beat the interest rate on my loans by going with a diversified approach rather that doing the insane “throw all money at loans now” approach that some people advocate on here.

[Anonymous User]

How did you guys decide when/whether to refinance? I'm a 3L, and I'll have around $220k in federal student loans at graduation. I'm going straight into biglaw but not sure how long I'll be able to stick it out and not even sure I want to practice law long-term. Anticipating near future pay cuts/periods of unemployment, I'm tempted not to refinance. The thought of having debt longer term doesn't affect me as much psychologically as the thought of being chained to biglaw (or law in general) for 4-5 years in order to pay off private loans.

[sparty99]

How did you guys decide when/whether to refinance? I'm a 3L, and I'll have around $220k in federal student loans at graduation. I'm going straight into biglaw but not sure how long I'll be able to stick it out and not even sure I want to practice law long-term. Anticipating near future pay cuts/periods of unemployment, I'm tempted not to refinance. The thought of having debt longer term doesn't affect me as much psychologically as the thought of being chained to biglaw (or law in general) for 4-5 years in order to pay off private loans.

I would refinance with that large debt. It will take you 4 to 5 years to pay off and that is assuming you threw all the money at the debt and stayed in big law (however not assuming any bonuses and raises). Its not even like you have to refinance all of it. Maybe a reasonable amount at first. Like $100k which you can pay off in 18 months easily.

[personofinterest]

How did you guys decide when/whether to refinance? I'm a 3L, and I'll have around $220k in federal student loans at graduation. I'm going straight into biglaw but not sure how long I'll be able to stick it out and not even sure I want to practice law long-term. Anticipating near future pay cuts/periods of unemployment, I'm tempted not to refinance. The thought of having debt longer term doesn't affect me as much psychologically as the thought of being chained to biglaw (or law in general) for 4-5 years in order to pay off private loans.

Based on my experience, you can pay off your loans in ~3 years of big law, depending on lifestyle/circumstances. It may be worth it to refinance, especially if you can sign up for a 10+ year plan. Then, you can make minimum payments on your loans and save up/invest the rest of your money to give you flexibility if you leave big law or law generally.

[MurdockLLP2]

How did you guys decide when/whether to refinance? I'm a 3L, and I'll have around $220k in federal student loans at graduation. I'm going straight into biglaw but not sure how long I'll be able to stick it out and not even sure I want to practice law long-term. Anticipating near future pay cuts/periods of unemployment, I'm tempted not to refinance. The thought of having debt longer term doesn't affect me as much psychologically as the thought of being chained to biglaw (or law in general) for 4-5 years in order to pay off private loans.

Based on my experience, you can pay off your loans in ~3 years of big law, depending on lifestyle/circumstances. It may be worth it to refinance, especially if you can sign up for a 10+ year plan. Then, you can make minimum payments on your loans and save up/invest the rest of your money to give you flexibility if you leave big law or law generally.

Can someone please explain how the bolded is possible in a high COL market? With taxes, rent, food and other fixed costs, I just don't see how you can pay off $200+K in loans in that time period.

[nealric]

How did you guys decide when/whether to refinance? I'm a 3L, and I'll have around $220k in federal student loans at graduation. I'm going straight into biglaw but not sure how long I'll be able to stick it out and not even sure I want to practice law long-term. Anticipating near future pay cuts/periods of unemployment, I'm tempted not to refinance. The thought of having debt longer term doesn't affect me as much psychologically as the thought of being chained to biglaw (or law in general) for 4-5 years in order to pay off private loans.

Based on my experience, you can pay off your loans in ~3 years of big law, depending on lifestyle/circumstances. It may be worth it to refinance, especially if you can sign up for a 10+ year plan. Then, you can make minimum payments on your loans and save up/invest the rest of your money to give you flexibility if you leave big law or law generally.

Can someone please explain how the bolded is possible in a high COL market? With taxes, rent, food and other fixed costs, I just don't see how you can pay off $200+K in loans in that time period.

It's doable, but you have to live like a student, which means roommates or a SO contributing and no dependents or other people to support. You don't go out and get your own apartment, eat out regularly (law firm will give you dinner most nights), buy a car, or have expensive hobbies (you don't have time for that anyways).

Your gross earnings will total $700k assuming current market bonus.
Assume take home of roughly $350k (conservative) after tax, health insurance, 401k.
You live on $30k/yr (more than many law school student budgets even in high COL cities).
$260k remaining for loans.
Interest will eat about $12k/yr on a 10 yr repayment plan at 6.8% (can lower with refinance), but you will be paying off much more quickly, so total interest will be ~20k front loaded to year 1.
That leaves you with $40k savings and no loans at the end of year 3. Enough for a down payment on a house in a low COL area.

If you are willing to take risks, you could refinance to a variable rate (~3-4%) invest instead, and pay in lump sum. You could conceivably walk away with a lot more money.

I concede that in practice few do this. Most biglaw associates want their own apartments and feel the need for a few luxuries after living like a pauper as a student. But it CAN be done.

[sparty99]

How did you guys decide when/whether to refinance? I'm a 3L, and I'll have around $220k in federal student loans at graduation. I'm going straight into biglaw but not sure how long I'll be able to stick it out and not even sure I want to practice law long-term. Anticipating near future pay cuts/periods of unemployment, I'm tempted not to refinance. The thought of having debt longer term doesn't affect me as much psychologically as the thought of being chained to biglaw (or law in general) for 4-5 years in order to pay off private loans.

Based on my experience, you can pay off your loans in ~3 years of big law, depending on lifestyle/circumstances. It may be worth it to refinance, especially if you can sign up for a 10+ year plan. Then, you can make minimum payments on your loans and save up/invest the rest of your money to give you flexibility if you leave big law or law generally.

Can someone please explain how the bolded is possible in a high COL market? With taxes, rent, food and other fixed costs, I just don't see how you can pay off $200+K in loans in that time period.

The high COL is really not that important. What is important is the rent. If your rent is $1,900, you can still save easily $6,000 to $6,500 after taxes assuming no investing, $180k, and a tight budget.

[MurdockLLP2]

How did you guys decide when/whether to refinance? I'm a 3L, and I'll have around $220k in federal student loans at graduation. I'm going straight into biglaw but not sure how long I'll be able to stick it out and not even sure I want to practice law long-term. Anticipating near future pay cuts/periods of unemployment, I'm tempted not to refinance. The thought of having debt longer term doesn't affect me as much psychologically as the thought of being chained to biglaw (or law in general) for 4-5 years in order to pay off private loans.

Based on my experience, you can pay off your loans in ~3 years of big law, depending on lifestyle/circumstances. It may be worth it to refinance, especially if you can sign up for a 10+ year plan. Then, you can make minimum payments on your loans and save up/invest the rest of your money to give you flexibility if you leave big law or law generally.

Can someone please explain how the bolded is possible in a high COL market? With taxes, rent, food and other fixed costs, I just don't see how you can pay off $200+K in loans in that time period.

The high COL is really not that important. What is important is the rent. If your rent is $1,900, you can still save easily $6,000 to $6,500 after taxes assuming no investing, $180k, and a tight budget.

Ok - so lets assume, as the poster above has, that your take-home pay for the three years is 350K. Rent for those three years (assuming the $1,900 amount, which is crazy low for a high COL market even accounting for roommates) is $68,400. That leaves $281K. Paying off $220K in loans (not accounting for interest) leaves $61K, broken out over three years is ~$20K per year for all expenses (food, clothing, internet, etc.) in a high COL market (where food costs are higher).

tl;dr I just don't see it.

[Anonymous User]

How did you guys decide when/whether to refinance? I'm a 3L, and I'll have around $220k in federal student loans at graduation. I'm going straight into biglaw but not sure how long I'll be able to stick it out and not even sure I want to practice law long-term. Anticipating near future pay cuts/periods of unemployment, I'm tempted not to refinance. The thought of having debt longer term doesn't affect me as much psychologically as the thought of being chained to biglaw (or law in general) for 4-5 years in order to pay off private loans.

Based on my experience, you can pay off your loans in ~3 years of big law, depending on lifestyle/circumstances. It may be worth it to refinance, especially if you can sign up for a 10+ year plan. Then, you can make minimum payments on your loans and save up/invest the rest of your money to give you flexibility if you leave big law or law generally.

Can someone please explain how the bolded is possible in a high COL market? With taxes, rent, food and other fixed costs, I just don't see how you can pay off $200+K in loans in that time period.

The high COL is really not that important. What is important is the rent. If your rent is $1,900, you can still save easily $6,000 to $6,500 after taxes assuming no investing, $180k, and a tight budget.

Ok - so lets assume, as the poster above has, that your take-home pay for the three years is 350K. Rent for those three years (assuming the $1,900 amount, which is crazy low for a high COL market even accounting for roommates) is $68,400. That leaves $281K. Paying off $220K in loans (not accounting for interest) leaves $61K, broken out over three years is ~$20K per year for all expenses (food, clothing, internet, etc.) in a high COL market (where food costs are higher).

tl;dr I just don't see it.

FWIW, I'm the OP with $220k in loans, and my share of the rent in San Diego with my significant other will be $1,200. Not a super high COL market but not dirt cheap either. That's a 1-bedroom, though. I also lived off of about $10k per academic year for expenses (minus internet/utilities) in law school in Boston, so $20k could be technically doable. Not that I personally plan on being anywhere near that aggressive, but I guess I could see it.

[QContinuum]

my share of the rent ... with my significant other will be $1,200. ... That's a 1-bedroom, though. I also lived off of about $10k per academic year for expenses (minus internet/utilities) in law school in Boston, so $20k could be technically doable.

Student housing in high COL markets is typically subsidized, so right off the bat I don't think it's realistic to count on replicating a student budget as an associate in NYC/Sil Val/what have you.

$2400 for a one-bedroom is terrific. You can't get anywhere close to that in Manhattan, San Fran, etc. That $2400 one-bedroom would be more like $4000.

I say this not to pooh-pooh saving aggressively. I'm a big proponent of minimizing expenses and paying down debt aggressively. I just think it's important to be realistic, and not overly optimistic. Trying to survive on $10k/year as an associate in a high COL area is just not realistic.

[sparty99]

How did you guys decide when/whether to refinance? I'm a 3L, and I'll have around $220k in federal student loans at graduation. I'm going straight into biglaw but not sure how long I'll be able to stick it out and not even sure I want to practice law long-term. Anticipating near future pay cuts/periods of unemployment, I'm tempted not to refinance. The thought of having debt longer term doesn't affect me as much psychologically as the thought of being chained to biglaw (or law in general) for 4-5 years in order to pay off private loans.

Based on my experience, you can pay off your loans in ~3 years of big law, depending on lifestyle/circumstances. It may be worth it to refinance, especially if you can sign up for a 10+ year plan. Then, you can make minimum payments on your loans and save up/invest the rest of your money to give you flexibility if you leave big law or law generally.

Can someone please explain how the bolded is possible in a high COL market? With taxes, rent, food and other fixed costs, I just don't see how you can pay off $200+K in loans in that time period.

The high COL is really not that important. What is important is the rent. If your rent is $1,900, you can still save easily $6,000 to $6,500 after taxes assuming no investing, $180k, and a tight budget.

Ok - so lets assume, as the poster above has, that your take-home pay for the three years is 350K. Rent for those three years (assuming the $1,900 amount, which is crazy low for a high COL market even accounting for roommates) is $68,400. That leaves $281K. Paying off $220K in loans (not accounting for interest) leaves $61K, broken out over three years is ~$20K per year for all expenses (food, clothing, internet, etc.) in a high COL market (where food costs are higher).

tl;dr I just don't see it.

Your calculations are wrong because you should earn like 180 or 190 a year. Also, HIGH COL is a subjective term. You might as well say the city. But I lived in nyc with a roommate for 1,400 my share in lower Manhattan.

[nealric]

How did you guys decide when/whether to refinance? I'm a 3L, and I'll have around $220k in federal student loans at graduation. I'm going straight into biglaw but not sure how long I'll be able to stick it out and not even sure I want to practice law long-term. Anticipating near future pay cuts/periods of unemployment, I'm tempted not to refinance. The thought of having debt longer term doesn't affect me as much psychologically as the thought of being chained to biglaw (or law in general) for 4-5 years in order to pay off private loans.

Based on my experience, you can pay off your loans in ~3 years of big law, depending on lifestyle/circumstances. It may be worth it to refinance, especially if you can sign up for a 10+ year plan. Then, you can make minimum payments on your loans and save up/invest the rest of your money to give you flexibility if you leave big law or law generally.

Can someone please explain how the bolded is possible in a high COL market? With taxes, rent, food and other fixed costs, I just don't see how you can pay off $200+K in loans in that time period.

The high COL is really not that important. What is important is the rent. If your rent is $1,900, you can still save easily $6,000 to $6,500 after taxes assuming no investing, $180k, and a tight budget.

Ok - so lets assume, as the poster above has, that your take-home pay for the three years is 350K. Rent for those three years (assuming the $1,900 amount, which is crazy low for a high COL market even accounting for roommates) is $68,400. That leaves $281K. Paying off $220K in loans (not accounting for interest) leaves $61K, broken out over three years is ~$20K per year for all expenses (food, clothing, internet, etc.) in a high COL market (where food costs are higher).

tl;dr I just don't see it.

You can get an acceptable place for between $1,000 and $1,500 per person (split 2-4 ways) in NYC. It won’t be in a trendy area and it won’t have a doorman, and you may need to walk up a few flights of stairs. I paid $700/mo per person for a 3 bedroom townhouse when I lived in DC (although I’d up it to $1,200 to account for recent gentrification). It was cheaper than student housing.

I can’t speak to SF, but food budget can actually be pretty cheap in NYC biglaw. Breakfast was a 1.25 bagel from a street vendor and dinner is usually on the firm/client. There are a ton of cheap lunch options. Groceries are more expensive, but not as bad as one might think of you aren’t shopping at places like Whole Foods.

[nixy]

Ok - so lets assume, as the poster above has, that your take-home pay for the three years is 350K.

Your calculations are wrong because you should earn like 180 or 190 a year.

There's a difference between take home and salary. For a single person in NYC take home pay on $220k is around $135k. You're not hitting $180-90k even with bonus. I'm not saying you're hurting, just that I don't think you have the right numbers.

I'm sure people can pay off $220k in loans over three years, but it's a little bit like if you have 100 lbs to lose - sure, you *can* do it, people *have* done it, but most people won't, because it's pretty hard. If your financial plan requires crazy levels of discipline, maybe you'll pull it off, or maybe you should plan for something a little more sustainable. Depends on your tolerance for debt/deprivation.

[Anonymous User]

How did you guys decide when/whether to refinance? I'm a 3L, and I'll have around $220k in federal student loans at graduation. I'm going straight into biglaw but not sure how long I'll be able to stick it out and not even sure I want to practice law long-term. Anticipating near future pay cuts/periods of unemployment, I'm tempted not to refinance. The thought of having debt longer term doesn't affect me as much psychologically as the thought of being chained to biglaw (or law in general) for 4-5 years in order to pay off private loans.

Based on my experience, you can pay off your loans in ~3 years of big law, depending on lifestyle/circumstances. It may be worth it to refinance, especially if you can sign up for a 10+ year plan. Then, you can make minimum payments on your loans and save up/invest the rest of your money to give you flexibility if you leave big law or law generally.

Can someone please explain how the bolded is possible in a high COL market? With taxes, rent, food and other fixed costs, I just don't see how you can pay off $200+K in loans in that time period.

The high COL is really not that important. What is important is the rent. If your rent is $1,900, you can still save easily $6,000 to $6,500 after taxes assuming no investing, $180k, and a tight budget.

Ok - so lets assume, as the poster above has, that your take-home pay for the three years is 350K. Rent for those three years (assuming the $1,900 amount, which is crazy low for a high COL market even accounting for roommates) is $68,400. That leaves $281K. Paying off $220K in loans (not accounting for interest) leaves $61K, broken out over three years is ~$20K per year for all expenses (food, clothing, internet, etc.) in a high COL market (where food costs are higher).

tl;dr I just don't see it.

Your calculations are wrong because you should earn like 180 or 190 a year. Also, HIGH COL is a subjective term. You might as well say the city. But I lived in nyc with a roommate for 1,400 my share in lower Manhattan.

You aren’t accounting for taxes-take home pay is far less that 190/180 especially if you live in NYC (federal, state and local without the SALT deduction).

The point of my comment was that it’s close to a pipe dream to pay down $200K in debt over 3 years and its insincere for this thread to assume otherwise in higher COL areas like NYC (where the majority of BigLaw jobs are). I applaud those who have paid down significant debt levels over the course of their careers but there are certain amounts that can’t be done.

[sparty99]

How did you guys decide when/whether to refinance? I'm a 3L, and I'll have around $220k in federal student loans at graduation. I'm going straight into biglaw but not sure how long I'll be able to stick it out and not even sure I want to practice law long-term. Anticipating near future pay cuts/periods of unemployment, I'm tempted not to refinance. The thought of having debt longer term doesn't affect me as much psychologically as the thought of being chained to biglaw (or law in general) for 4-5 years in order to pay off private loans.

Based on my experience, you can pay off your loans in ~3 years of big law, depending on lifestyle/circumstances. It may be worth it to refinance, especially if you can sign up for a 10+ year plan. Then, you can make minimum payments on your loans and save up/invest the rest of your money to give you flexibility if you leave big law or law generally.

Can someone please explain how the bolded is possible in a high COL market? With taxes, rent, food and other fixed costs, I just don't see how you can pay off $200+K in loans in that time period.

The high COL is really not that important. What is important is the rent. If your rent is $1,900, you can still save easily $6,000 to $6,500 after taxes assuming no investing, $180k, and a tight budget.

Ok - so lets assume, as the poster above has, that your take-home pay for the three years is 350K. Rent for those three years (assuming the $1,900 amount, which is crazy low for a high COL market even accounting for roommates) is $68,400. That leaves $281K. Paying off $220K in loans (not accounting for interest) leaves $61K, broken out over three years is ~$20K per year for all expenses (food, clothing, internet, etc.) in a high COL market (where food costs are higher).

tl;dr I just don't see it.

Your calculations are wrong because you should earn like 180 or 190 a year. Also, HIGH COL is a subjective term. You might as well say the city. But I lived in nyc with a roommate for 1,400 my share in lower Manhattan.

You aren’t accounting for taxes-take home pay is far less that 190/180 especially if you live in NYC (federal, state and local without the SALT deduction).

The point of my comment was that it’s close to a pipe dream to pay down $200K in debt over 3 years and its insincere for this thread to assume otherwise in higher COL areas like NYC (where the majority of BigLaw jobs are). I applaud those who have paid down significant debt levels over the course of their careers but there are certain amounts that can’t be done.

I am applying for taxes. But even assuming it was NYC, it is possible. Because the salary is 190, lock step raises, and high bonuses. So even assuming taxes, 190k is 122k after all the New York city taxes. Then all the bonuses and raises.

[QContinuum]

You can get an acceptable place for between $1,000 and $1,500 per person (split 2-4 ways) in NYC. It won’t be in a trendy area and it won’t have a doorman, and you may need to walk up a few flights of stairs.

If you lived in a fifth-floor walkup in a neighborhood on the outer edges of gentrification with three roommates, munching on a plain bagel for breakfast every day... man, neal, I never knew you were so tough. There's frugal and then there's living like a monk!

[nixy]

I am applying for taxes. But even assuming it was NYC, it is possible. Because the salary is 190, lock step raises, and high bonuses. So even assuming taxes, 190k is 122k after all the New York city taxes. Then all the bonuses and raises.

Cravath scale is:

1st year - $15,000 bonus (pro rated), and $190,000 base salary
2nd year – $15,000 bonus, and $200,000 base salary
3rd year – $25,000 bonus, and $220,000 base salary

$220k base salary is $11,315/mo. take-home (based on highly scientific googling of take home pay calculators for NYC) = $135,780.

$135,780 + $19.5k ($25k after tax, again based on highly scientific googling) = $155,280

Again, I'm not remotely claiming someone with this salary can't make decent loan payments. But you're not getting $180-190k a year, certainly not all three years, especially since these numbers (even if approximate) don't cover health insurance premiums that get taken out of your paycheck.

[The Lsat Airbender]

I am applying for taxes. But even assuming it was NYC, it is possible. Because the salary is 190, lock step raises, and high bonuses. So even assuming taxes, 190k is 122k after all the New York city taxes. Then all the bonuses and raises.

Cravath scale is:

1st year - $15,000 bonus (pro rated), and $190,000 base salary
2nd year – $15,000 bonus, and $200,000 base salary
3rd year – $25,000 bonus, and $220,000 base salary

$220k base salary is $11,315/mo. take-home (based on highly scientific googling of take home pay calculators for NYC) = $135,780.

$135,780 + $19.5k ($25k after tax, again based on highly scientific googling) = $155,280

Again, I'm not remotely claiming someone with this salary can't make decent loan payments. But you're not getting $180-190k a year, certainly not all three years, especially since these numbers (even if approximate) don't cover health insurance premiums that get taken out of your paycheck.

You're wasting your time. This person literally can't comprehend income taxation which is why they don't bother with their 401(k).

[sparty99]

I am applying for taxes. But even assuming it was NYC, it is possible. Because the salary is 190, lock step raises, and high bonuses. So even assuming taxes, 190k is 122k after all the New York city taxes. Then all the bonuses and raises.

Cravath scale is:

1st year - $15,000 bonus (pro rated), and $190,000 base salary
2nd year – $15,000 bonus, and $200,000 base salary
3rd year – $25,000 bonus, and $220,000 base salary

$220k base salary is $11,315/mo. take-home (based on highly scientific googling of take home pay calculators for NYC) = $135,780.

$135,780 + $19.5k ($25k after tax, again based on highly scientific googling) = $155,280

Again, I'm not remotely claiming someone with this salary can't make decent loan payments. But you're not getting $180-190k a year, certainly not all three years, especially since these numbers (even if approximate) don't cover health insurance premiums that get taken out of your paycheck.

Ugh, well no shit. It is a base salary so you are not getting 180 to 190k. And still even after taxes that is $389,000 of earned take home income (122k + 128k + 139k). Bonuses is another 38k (5k + 13k + 20k). So $427k versus $220k in debt. That is a $207,000 difference which can take into consideration food, rent, health premiums, student loan interest, T.J. Maxx, and any difference in take home pay calculators. Nice try trying to prove me wrong, but you failed.

[MurdockLLP2]

I am applying for taxes. But even assuming it was NYC, it is possible. Because the salary is 190, lock step raises, and high bonuses. So even assuming taxes, 190k is 122k after all the New York city taxes. Then all the bonuses and raises.

Cravath scale is:

1st year - $15,000 bonus (pro rated), and $190,000 base salary
2nd year – $15,000 bonus, and $200,000 base salary
3rd year – $25,000 bonus, and $220,000 base salary

$220k base salary is $11,315/mo. take-home (based on highly scientific googling of take home pay calculators for NYC) = $135,780.

$135,780 + $19.5k ($25k after tax, again based on highly scientific googling) = $155,280

Again, I'm not remotely claiming someone with this salary can't make decent loan payments. But you're not getting $180-190k a year, certainly not all three years, especially since these numbers (even if approximate) don't cover health insurance premiums that get taken out of your paycheck.

Ugh, well no shit. It is a base salary so you are not getting 180 to 190k. And still even after taxes that is $389,000 of earned take home income (122k + 128k + 139k). Bonuses is another 38k (5k + 13k + 20k). So $427k versus $220k in debt. That is a $207,000 difference which can take into consideration food, rent, health premiums, student loan interest, T.J. Maxx, and any difference in take home pay calculators. Nice try trying to prove me wrong, but you failed.

I don’t mean to extend this conversation any longer than it needs to be but you didn’t account for taxes on the bonuses here. Even with this oversight your math leaves only $207K to spend on food, clothing, health insurance and shelter (which, even under the best case scenario of $1K per month is still $36K for three years) leaving you with less than $200K to pay off the $200K in loans.

I will also say that the Cravath scale listed above is also slightly flawed, since the 5K prorated bonus is paid after your stub year, the 15K bonus is paid after your first year, where you make 190K (that’s pretax, and the 25 is paid after the second year, where you make 200K.

Again, the goal of my original post was not to show that lawyers are bad at math, but rather to demonstrate that paying off $200K in debt in 3 years in a high COL/high tax market is not as feasible as it seems when accounting for rent and taxes.

[nixy]

Ugh, well no shit. It is a base salary so you are not getting 180 to 190k.

Sparty, why tf are you so incredibly belligerent in every post you make? I was literally only making the point that someone said “take home is $350k” and you said “that’s wrong because you earn $180-190k a year” and the Cravath scale doesn’t actually earn someone $180-190k a year in take home pay. So, glad to see you’ve now acknowledged that.

Also of course you think you’re right if you just pick different base numbers than I do. The take home pay calculator I used for NYC results in $93k take home on a $190k salary, not $122k.