Student loan payments: get advice and actual numbers here Forum

[XxSpyKEx]

My general stance on these things is "refinance where you can get the lowest interest rate possible."

This makes sense, but I think you also have to factor in the loss of the safety net and other favorable repayment considerations (e.g. PLSF) when you have something like $250k in student loans. With that said, if you're sure that you're going to stay in private practice, I think your point re: refinancing, making min payments, and stashing the extra money for when you get shitcanned makes sense.

Yeah, I get the general paranoia about getting shitcanned from biglaw, but I don't get the general paranoia that one wouldn't be able to earn at least $100,000 a year thereafter. That salary is more than enough to service this debt.

$100k /year with being merely 3 years out of law school sounds really high for most non-NYC markets. $100k /year sucks in NYC, especially if you're going to need to make student loan payments out of that ($100k is like $65k /year take home in NYC, at best).

[Old Gregg]

and other favorable repayment considerations (e.g. PLSF) when you have something like $250k in student loans. With that said, if you're sure that you're going to stay in private practice, I think your point re: refinancing, making min payments, and stashing the extra money for when you get shitcanned makes sense.

Agreed. If you have the option to PLSF, it changes the math entirely. Everyone's situation is different.

$100k /year with being merely 3 years out of law school sounds really high for most non-NYC markets. $100k /year sucks in NYC, especially if you're going to need to make student loan payments out of that ($100k is like $65k /year take home in NYC, at best).

I actually don't think so. If you have a decent biglaw pedigree, I don't envision it being difficult to score a job paying at least $100k in Chicago, Houston, LA, SF, DC or Boston (I'm including biglaw jobs). Some of those markets have COL rivaling NYC, but most don't.

[XxSpyKEx]

$100k /year with being merely 3 years out of law school sounds really high for most non-NYC markets. $100k /year sucks in NYC, especially if you're going to need to make student loan payments out of that ($100k is like $65k /year take home in NYC, at best).

I actually don't think so. If you have a decent biglaw pedigree, I don't envision it being difficult to score a job paying at least $100k in Chicago, Houston, LA, SF, DC or Boston (I'm including biglaw jobs). Some of those markets have COL rivaling NYC, but most don't.

It depends on what you're able to get after biglaw. The biglaw spinoff firms def pay $100k+, but there aren't that many of them in cities like Chicago. And there are a TON of "great" biglaw lit attorneys (i.e. ones who didn't get shitcanned/asked to leave) looking to to lateral. Those firms will that take those "great" attorneys well before they take the ones that were shitcanned/asked to leave. If your wind up doing some bullshit like personal injury after biglaw (which happens), you're not likely to be making 6-figures after biglaw.

A lot of what your options look like after biglaw also depend on what the market looks like then. If your were an ex-biglaw associate looking for a job in 2009, you're odds of finding something good were pretty low. If you're a ex-corporate biglaw attorney now, then your odds of finding something reasonable are much better.

It doesn't take that much pedigree to get biglaw today (pretty much just need to be the average t14 grad, at best), so I wouldn't put too much value into getting biglaw (unless you also had some stellar creds)

[Old Gregg]

It doesn't take that much pedigree to get biglaw today (pretty much just need to be the average t14 grad, at best), so I wouldn't put too much value into getting biglaw (unless you also had some stellar creds)

You're living in a bubble. You say that it doesn't take much pedigree to get biglaw today, but then you say you need a degree from one of the nation's most prestigious law schools. Which is it going to be?

It's easy to think we're a time a dozen when we live and work in a world where we're surrounded by people with credentials very similar to ours. But the reality couldn't be further from the truth, especially with regard to law students who were able to obtain biglaw during the financial crisis.

Further to the point, the lateral market is super hot right now... for qualified candidates. I am aware of pedigreed attorneys who have been laid off even as close to a few months ago and who have been unable to find something. But that's been the strong exception to the rule and it's pretty easy to point to a fatal flaw for that.

Anyways, I'm not sure what we're arguing. You've done your analysis and rendered your risk tolerance accordingly, as have I. I'm not about to change it or even try, to be honest, and everyone is different. But that's the way I think.

[JenDarby]

zweit (or anyone else)!!

My Grad plus loans range in interest rates from 6.4-7.9%.

Am I better off making a big payment towards the 7.9% loan or paying off the total amount of my accrued interest on the grad plus loans?

Isn't there a compounding aspect which favors paying off the accrued interest? Or am I better off just paying down the higher interest rate loans?

[Big Shrimpin]

Just finalized SoFi. 3.1%.

Here we gooooo.

[prezidentv8]

Just finalized SoFi. 3.1%.

Here we gooooo.

Bout to jump onto that bandwagon myself.

[el madrileno]

tagged

[wojo98]

Taggin'

[sinfiery]

With NYC Biglaw, can you itemize your NY State and NYC taxes?


Is 160k--->96k already including that?

[Fed_Atty]

With NYC Biglaw, can you itemize your NY State and NYC taxes?


Is 160k--->96k already including that?

I am guessing that the majority of single posters that do not own their residence are taking the standard deduction as it is likely greater than what they would get for itemizing.

[bdubs]

To those who refi'ed: any advantage to doing everything at once or were the rates the same regardless? Thinking about doing a refi of only my 7.9% loans for now.

Also WSJ recently covered a new refi offer from Citizens Financial (2.3 var, 4.74 fixed), no idea if it's really that good or not but figured it was worth sharing.

[JenDarby]

To those who refi'ed: any advantage to doing everything at once or were the rates the same regardless? Thinking about doing a refi of only my 7.9% loans for now.

Also WSJ recently covered a new refi offer from Citizens Financial (2.3 var, 4.74 fixed), no idea if it's really that good or not but figured it was worth sharing.

I was strongly considering this as well. I figured I will actually call Sofi and speak to them about options.

[sinfiery]

With NYC Biglaw, can you itemize your NY State and NYC taxes?


Is 160k--->96k already including that?

I am guessing that the majority of single posters that do not own their residence are taking the standard deduction as it is likely greater than what they would get for itemizing.

Standard deduction is 6200 and NYC/State taxes are like 12k+ or something + all the other stuff you can likely deduct


But I am not sure if you can deduct NYC/State taxes

[Tiago Splitter]

With NYC Biglaw, can you itemize your NY State and NYC taxes?


Is 160k--->96k already including that?

I am guessing that the majority of single posters that do not own their residence are taking the standard deduction as it is likely greater than what they would get for itemizing.

Standard deduction is 6200 and NYC/State taxes are like 12k+ or something + all the other stuff you can likely deduct


But I am not sure if you can deduct NYC/State taxes

You can if you itemize.

[horriblegb]

To those who refi'ed: any advantage to doing everything at once or were the rates the same regardless? Thinking about doing a refi of only my 7.9% loans for now.

Also WSJ recently covered a new refi offer from Citizens Financial (2.3 var, 4.74 fixed), no idea if it's really that good or not but figured it was worth sharing.

FWIW I did exactly what you are considering to do. It ended up working very well for me when I went through a rough patch, I still had the safety net.

I am taking my chances as far as that goes I suppose but I am pretty happy to still have some flexibility but to know that my larger loan in $ and interest is at a much lower percentage.

[Anonymous User]

Is assuming an after-tax income of $9,300/month wildly optimistic for NYC?

[Old Gregg]

Is assuming an after-tax income of $9,300/month wildly optimistic for NYC?

Off of $160k? Holy shit yes. You're looking at mid-$6k if you live in one of the five burroughs.

[Anonymous User]

Is assuming an after-tax income of $9,300/month wildly optimistic for NYC?

Off of $160k? Holy shit yes. You're looking at mid-$6k if you live in one of the five burroughs.

That's an effective tax rate of more than 50%. I don't believe you.
I was thinking $8500 might be more closer to reality.

[brazleton]

.

[gk101]

Is assuming an after-tax income of $9,300/month wildly optimistic for NYC?

Off of $160k? Holy shit yes. You're looking at mid-$6k if you live in one of the five burroughs.

I think its closer to 8k/month

[anonnymouse]

Is assuming an after-tax income of $9,300/month wildly optimistic for NYC?

Off of $160k? Holy shit yes. You're looking at mid-$6k if you live in one of the five burroughs.

I think its closer to 8k/month

According to --LinkRemoved-- which includes Federal, State, and City taxes, the monthly take-home for a single individual in NYC is slightly above $7800.

Adding in bonus puts average monthly take-home above $8000 but for calculating regular expenses, it's probably not prudent to factor in once/year bonus payments.

[XxSpyKEx]

Is assuming an after-tax income of $9,300/month wildly optimistic for NYC?

Off of $160k? Holy shit yes. You're looking at mid-$6k if you live in one of the five burroughs.

I think its closer to 8k/month

According to --LinkRemoved-- which includes Federal, State, and City taxes, the monthly take-home for a single individual in NYC is slightly above $7800.

Adding in bonus puts average monthly take-home above $8000 but for calculating regular expenses, it's probably not prudent to factor in once/year bonus payments.

I think you're screwing up your deductions (or something). $7800 per month comes out to merely $93,600 on a $160k /year salary, not even including additional withholding such as health insurance. That's not correct. It's most like $8,400-8,500 per month with only taking out taxes for a single person (including one allowance for yourself). After you take out additional withholding, such as health insurance and what not, it'll probably be closer to $8100-8200 per month.

[anonnymouse]

I think you're screwing up your deductions (or something). $7800 per month comes out to merely $93,600 on a $160k /year salary, not even including additional withholding such as health insurance. That's not correct. It's most like $8,400-8,500 per month with only taking out taxes for a single person (including one allowance for yourself). After you take out additional withholding, such as health insurance and what not, it'll probably be closer to $8100-8200 per month.

Yeah I put no withholdings/allowances into the calculator.

However, if you're taking out health insurance, remember that that's coming off your top line and reducing your take-home. It's just not reduced dollar-for-dollar.

[Anonymous User]

With NYC Biglaw, can you itemize your NY State and NYC taxes?


Is 160k--->96k already including that?

I am guessing that the majority of single posters that do not own their residence are taking the standard deduction as it is likely greater than what they would get for itemizing.

Standard deduction is 6200 and NYC/State taxes are like 12k+ or something + all the other stuff you can likely deduct


But I am not sure if you can deduct NYC/State taxes

You can if you itemize.

if you are in AMT, in reality you don't get to deduct your state taxes on your fed return.