Student loan payments: get advice and actual numbers here Forum

[hurldes]

Grad year: 2014
Salary: Biglaw Cravath scale -- $280k now
Debt at graduation: $265k
Current debt: $0

I paid off my law school debt literally last week. After my first year when I realized I could stay in biglaw for a while I refinanced with sofi on a 7-year fixed 4% loan. My minimums were $3k per month, and I often put double or even triple that toward my loan. I've been maxing out my 401k but other than I have no savings. Maybe like $2,000 in a separate online bank account. I know that's irresponsible but my parents said I could move back in with them if I ever lost my job. I got a couple of biglaw bonuses and put 100% of those toward my loan. Seeing my bank account rise to $48k and then drop back to $566.88 in one day was more difficult than I thought it would be. I don't own a home and I drive the same car I had in high school, but I still go on vacations and eat out somewhat often (fast-casual mostly).

[sparty99]

Grad year: 2014
Salary: Biglaw Cravath scale -- $280k now
Debt at graduation: $265k
Current debt: $0

I paid off my law school debt literally last week. After my first year when I realized I could stay in biglaw for a while I refinanced with sofi on a 7-year fixed 4% loan. My minimums were $3k per month, and I often put double or even triple that toward my loan. I've been maxing out my 401k but other than I have no savings. Maybe like $2,000 in a separate online bank account. I know that's irresponsible but my parents said I could move back in with them if I ever lost my job. I got a couple of biglaw bonuses and put 100% of those toward my loan. Seeing my bank account rise to $48k and then drop back to $566.88 in one day was more difficult than I thought it would be. I don't own a home and I drive the same car I had in high school, but I still go on vacations and eat out somewhat often (fast-casual mostly).

Well....You could easily be saving $7 to 10k so not a big deal that you only have $600 in the bank account. $280k and no debt is a lot of money. You will have over $100k 12 months from now. Let that sit in.

[cheaptilts]

Grad year: 2014
Salary: Biglaw Cravath scale -- $280k now
Debt at graduation: $265k
Current debt: $0

I paid off my law school debt literally last week. After my first year when I realized I could stay in biglaw for a while I refinanced with sofi on a 7-year fixed 4% loan. My minimums were $3k per month, and I often put double or even triple that toward my loan. I've been maxing out my 401k but other than I have no savings. Maybe like $2,000 in a separate online bank account. I know that's irresponsible but my parents said I could move back in with them if I ever lost my job. I got a couple of biglaw bonuses and put 100% of those toward my loan. Seeing my bank account rise to $48k and then drop back to $566.88 in one day was more difficult than I thought it would be. I don't own a home and I drive the same car I had in high school, but I still go on vacations and eat out somewhat often (fast-casual mostly).

Congratulations! I’m over here hype for you. Good work.

[hurldes]

Grad year: 2014
Salary: Biglaw Cravath scale -- $280k now
Debt at graduation: $265k
Current debt: $0

I paid off my law school debt literally last week. After my first year when I realized I could stay in biglaw for a while I refinanced with sofi on a 7-year fixed 4% loan. My minimums were $3k per month, and I often put double or even triple that toward my loan. I've been maxing out my 401k but other than I have no savings. Maybe like $2,000 in a separate online bank account. I know that's irresponsible but my parents said I could move back in with them if I ever lost my job. I got a couple of biglaw bonuses and put 100% of those toward my loan. Seeing my bank account rise to $48k and then drop back to $566.88 in one day was more difficult than I thought it would be. I don't own a home and I drive the same car I had in high school, but I still go on vacations and eat out somewhat often (fast-casual mostly).

Congratulations! I’m over here hype for you. Good work.

Thank you!

[Anonymous User]

Grad year: 2014
Salary: Biglaw Cravath scale -- $280k now
Debt at graduation: $265k
Current debt: $0

I paid off my law school debt literally last week. After my first year when I realized I could stay in biglaw for a while I refinanced with sofi on a 7-year fixed 4% loan. My minimums were $3k per month, and I often put double or even triple that toward my loan. I've been maxing out my 401k but other than I have no savings. Maybe like $2,000 in a separate online bank account. I know that's irresponsible but my parents said I could move back in with them if I ever lost my job. I got a couple of biglaw bonuses and put 100% of those toward my loan. Seeing my bank account rise to $48k and then drop back to $566.88 in one day was more difficult than I thought it would be. I don't own a home and I drive the same car I had in high school, but I still go on vacations and eat out somewhat often (fast-casual mostly).

Congrats!!! As someone who started off with a similar amount of loans at graduation, this gives me something to look forward to.

Grad year: 2016
Salary: 3rd year in Big Law ($220k)
Debt at graduation: $250k
Current debt: $85k (refinanced with FRB)

I've also maxed out my 401k each year since I started working and put the max amount into a backdoor Roth IRA the last two years, and I currently have about $40k in savings (distributed amongst checking and savings accounts). Crossing my fingers for my bonus in January and hopefully being debt free early 2020.

I feel like my progress came at a huge mental/emotional/physical cost though... It's kind of terrible working a demanding job and feeling like I have nothing to show for it financially, numbers-wise, so overall I'm pretty unhappy with the choice I made of going to law school, taking out that much in student loans and working in Big Law. I know my situation could always be worse, and things have generally worked out for the most part, but I would definitely not go to law school if I could travel back in time.

[sparty99]

Grad year: 2014
Salary: Biglaw Cravath scale -- $280k now
Debt at graduation: $265k
Current debt: $0

I paid off my law school debt literally last week. After my first year when I realized I could stay in biglaw for a while I refinanced with sofi on a 7-year fixed 4% loan. My minimums were $3k per month, and I often put double or even triple that toward my loan. I've been maxing out my 401k but other than I have no savings. Maybe like $2,000 in a separate online bank account. I know that's irresponsible but my parents said I could move back in with them if I ever lost my job. I got a couple of biglaw bonuses and put 100% of those toward my loan. Seeing my bank account rise to $48k and then drop back to $566.88 in one day was more difficult than I thought it would be. I don't own a home and I drive the same car I had in high school, but I still go on vacations and eat out somewhat often (fast-casual mostly).

Congrats!!! As someone who started off with a similar amount of loans at graduation, this gives me something to look forward to.

Grad year: 2016
Salary: 3rd year in Big Law ($220k)
Debt at graduation: $250k
Current debt: $85k (refinanced with FRB)

I've also maxed out my 401k each year since I started working and put the max amount into a backdoor Roth IRA the last two years, and I currently have about $40k in savings (distributed amongst checking and savings accounts). Crossing my fingers for my bonus in January and hopefully being debt free early 2020.

I feel like my progress came at a huge mental/emotional/physical cost though... It's kind of terrible working a demanding job and feeling like I have nothing to show for it financially, numbers-wise, so overall I'm pretty unhappy with the choice I made of going to law school, taking out that much in student loans and working in Big Law. I know my situation could always be worse, and things have generally worked out for the most part, but I would definitely not go to law school if I could travel back in time.

You will be debt free by the end of December the way I see it (if not sooner). Just take that $40k and throw it at the current debt! Then you will have $220k salary and no debt by 2019. Plus a bonus? You could easily $35,000 (or more) by March. You could essentially tell yourself one more year in big law and start counting down.

[Anonymous User]

Grad Year: 2019
Loan Debt:197k
Other debt: 20k cc
Income: 54k govt temp position

I spoke to financial advisor they recommended to get on REPAYE/PAYE. I am not sure if I want to stay in govt but might considering my debt load to take advantage of pslf. I am thinking of paying cc debt aggressively while I’m employed at this job and saving whatever I have left over. Any other recommendations? Debt seems pretty daunting right now.

[L'orDuCommun]

Beginner's question: Will anybody refinance bar study loans (assuming you also refinance your regular student loans)?

[Anonymous User]

2014 grad, just officially paid off loans, used this thread a lot for motivation to keep pushing through (and to reassure myself that I wasn't the only idiot who did this...), figured I'd provide a data point.

Debt: ~$190,000 (partial scholarship 1L, transferred to CCN and paid sticker 2L/3L)
Payments: $2K/month post-refi with SoFi in 2017. I got off to a slow start and still had $150K at the time of refi in 2017. Since then, I'd try to pay $4K/month and throw "extra cash" at the debt whenever possible (100% of tax refunds and bonuses). Did a 7 year fixed rate refi at 4% (down from blended 6-7% with the fed loans), figured I'd pay it off sooner than 7 years but didn't want to lock in too high of a monthly payment in case something came up.
Income: Biglaw scale, started at $160K, went in house and at ~$345K this year

Notes/Thoughts:
- The best loan repayment strategy is taking out less loans to begin with. I remember as a 0L thinking taking out the full recommended amount was the only option and that while it was a lot of money, it would all be easily repaid when making lawyer comp. That made everything easier at the time, but so much harder on the back end. First world problems for sure, but it's painful to be making a lot of money and have nothing to show for it.
- I'd strongly encourage 0Ls to retake LSAT to increase scholarships, work part-time during law school, live with parents or roommates, live frugally, don't spend money you don't have or inflate your lifestyle based on expected future earnings. You will thank yourself later. These loans are real money that you have to pay back every month out of your pocket. For every dollar you take out, you have to pay that dollar back, plus interest, plus missed opportunity to invest.
- The first couple years post law school I contributed to a 401k, but in hindsight I would have paused all investing until the debt was done. I know that may not be the "right" answer if market returns are higher than loan interest yada yada and obviously a personal risk tolerance call, but once I stopped the 401k, I became hyper focused on paying off my loans because I didn't like the idea that I was delaying investing/retirement planning. Now I'm a few years behind on retirement which sucks, but can invest more on a monthly basis without any debt payments, which just feels better to me personally.
- I would have refi'd sooner in hindsight. I could say that I wanted to make sure I had job security at my firm before I gave up the protections of federal loans, but in reality I just procrastinated and ended up paying a bunch more interest as a result.
- Was it worth it? Tough question. I took a big risk taking out loans to attend a mid-tier law school. I got really lucky that I was able to transfer to CCN and get a big law job which enabled me to eventually pay off the six figure debt. But at the end of the day, I've still spent the last 8 years working like crazy just to get back to even, which is a depressing thought. That said, I realize I'm in a great position moving forward, so all things considered I'd do it again.

Good luck to everyone repaying loans, there is a light at the end of the tunnel. 0Ls, please do yourself a favor and find ways to minimize your loans.

[sparty99]

2014 grad, just officially paid off loans, used this thread a lot for motivation to keep pushing through (and to reassure myself that I wasn't the only idiot who did this...), figured I'd provide a data point.

Debt: ~$190,000 (partial scholarship 1L, transferred to CCN and paid sticker 2L/3L)
Payments: $2K/month post-refi with SoFi in 2017. I got off to a slow start and still had $150K at the time of refi in 2017. Since then, I'd try to pay $4K/month and throw "extra cash" at the debt whenever possible (100% of tax refunds and bonuses). Did a 7 year fixed rate refi at 4% (down from blended 6-7% with the fed loans), figured I'd pay it off sooner than 7 years but didn't want to lock in too high of a monthly payment in case something came up.
Income: Biglaw scale, started at $160K, went in house and at ~$345K this year

Notes/Thoughts:
- The best loan repayment strategy is taking out less loans to begin with. I remember as a 0L thinking taking out the full recommended amount was the only option and that while it was a lot of money, it would all be easily repaid when making lawyer comp. That made everything easier at the time, but so much harder on the back end. First world problems for sure, but it's painful to be making a lot of money and have nothing to show for it.
- I'd strongly encourage 0Ls to retake LSAT to increase scholarships, work part-time during law school, live with parents or roommates, live frugally, don't spend money you don't have or inflate your lifestyle based on expected future earnings. You will thank yourself later. These loans are real money that you have to pay back every month out of your pocket. For every dollar you take out, you have to pay that dollar back, plus interest, plus missed opportunity to invest.
- The first couple years post law school I contributed to a 401k, but in hindsight I would have paused all investing until the debt was done. I know that may not be the "right" answer if market returns are higher than loan interest yada yada and obviously a personal risk tolerance call, but once I stopped the 401k, I became hyper focused on paying off my loans because I didn't like the idea that I was delaying investing/retirement planning. Now I'm a few years behind on retirement which sucks, but can invest more on a monthly basis without any debt payments, which just feels better to me personally.
- I would have refi'd sooner in hindsight. I could say that I wanted to make sure I had job security at my firm before I gave up the protections of federal loans, but in reality I just procrastinated and ended up paying a bunch more interest as a result.
- Was it worth it? Tough question. I took a big risk taking out loans to attend a mid-tier law school. I got really lucky that I was able to transfer to CCN and get a big law job which enabled me to eventually pay off the six figure debt. But at the end of the day, I've still spent the last 8 years working like crazy just to get back to even, which is a depressing thought. That said, I realize I'm in a great position moving forward, so all things considered I'd do it again.

Good luck to everyone repaying loans, there is a light at the end of the tunnel. 0Ls, please do yourself a favor and find ways to minimize your loans.

Omg. $345,000? Wow

[hurldes]

2014 grad, just officially paid off loans, used this thread a lot for motivation to keep pushing through (and to reassure myself that I wasn't the only idiot who did this...), figured I'd provide a data point.

Debt: ~$190,000 (partial scholarship 1L, transferred to CCN and paid sticker 2L/3L)
Payments: $2K/month post-refi with SoFi in 2017. I got off to a slow start and still had $150K at the time of refi in 2017. Since then, I'd try to pay $4K/month and throw "extra cash" at the debt whenever possible (100% of tax refunds and bonuses). Did a 7 year fixed rate refi at 4% (down from blended 6-7% with the fed loans), figured I'd pay it off sooner than 7 years but didn't want to lock in too high of a monthly payment in case something came up.
Income: Biglaw scale, started at $160K, went in house and at ~$345K this year

Notes/Thoughts:
- The best loan repayment strategy is taking out less loans to begin with. I remember as a 0L thinking taking out the full recommended amount was the only option and that while it was a lot of money, it would all be easily repaid when making lawyer comp. That made everything easier at the time, but so much harder on the back end. First world problems for sure, but it's painful to be making a lot of money and have nothing to show for it.
- I'd strongly encourage 0Ls to retake LSAT to increase scholarships, work part-time during law school, live with parents or roommates, live frugally, don't spend money you don't have or inflate your lifestyle based on expected future earnings. You will thank yourself later. These loans are real money that you have to pay back every month out of your pocket. For every dollar you take out, you have to pay that dollar back, plus interest, plus missed opportunity to invest.
- The first couple years post law school I contributed to a 401k, but in hindsight I would have paused all investing until the debt was done. I know that may not be the "right" answer if market returns are higher than loan interest yada yada and obviously a personal risk tolerance call, but once I stopped the 401k, I became hyper focused on paying off my loans because I didn't like the idea that I was delaying investing/retirement planning. Now I'm a few years behind on retirement which sucks, but can invest more on a monthly basis without any debt payments, which just feels better to me personally.
- I would have refi'd sooner in hindsight. I could say that I wanted to make sure I had job security at my firm before I gave up the protections of federal loans, but in reality I just procrastinated and ended up paying a bunch more interest as a result.
- Was it worth it? Tough question. I took a big risk taking out loans to attend a mid-tier law school. I got really lucky that I was able to transfer to CCN and get a big law job which enabled me to eventually pay off the six figure debt. But at the end of the day, I've still spent the last 8 years working like crazy just to get back to even, which is a depressing thought. That said, I realize I'm in a great position moving forward, so all things considered I'd do it again.

Good luck to everyone repaying loans, there is a light at the end of the tunnel. 0Ls, please do yourself a favor and find ways to minimize your loans.

Omg. $345,000? Wow

Seriously! Where do you work to make this much?

[Anonymous User]

Grad year: 2018
Debt at graduation: $110k
Current debt: $68k
Salary: $190k
Savings: $15k

I was one of the people who decided to attend a school outside the T14 for significant scholarship money (most of my loans were for COL in an expensive city), and I am SO, SO glad I went this route. I got the "ideal" outcome of doing well in school and landing biglaw, and I'd hoped to stay 2-3 years to pay off the loans, but one year in and I'm so incredibly miserable. Planning my exit within the next 6 months; hoping to move to state government with aspirations of a $70k salary.

The question is, how should I prepare for this change? Obviously reducing monthly expenses--not that there are many other than a nice apartment I never see. But I'm moreso wondering whether I should continue to aggressively pay down the loans and only save a few months of living expenses, or if I should start moving to smaller payments and save more. I've been paying about $5-6000 a month, and am thinking I'll start paying more like $1500 to start saving.

Would love to hear any words of advice/encouragement that I will be able to survive on a much lower salary...tbh the thing that makes me the happiest is running and all I need for that is time.

Thanks guys!

[Anonymous User]

Grad year: 2015
Debt upon starting repayment: $240k
Current debt: $165k
Salary: $255k
Savings: $50k (excluding 401k, which I half-maxed in 2016 and maxed in 2018 & 19)

Refinanced with SoFi at just under 5% fixed soon after graduation, then clerked for a year and made peanuts but still made the $2800 minimum payments during that year. Recently refinanced again at closer to 4% fixed with a lower minimum. Hoping to throw some bonus money at the loans this year before leaving BigLaw for good in 1-2 years once the debt is at a more manageable 5 figures. Don't own my home and am making car payments as well. Regretting attending CCN and foregoing significant money UVA and GULC offered.

[BigLawer]

2014 grad, just officially paid off loans, used this thread a lot for motivation to keep pushing through (and to reassure myself that I wasn't the only idiot who did this...), figured I'd provide a data point.

Debt: ~$190,000 (partial scholarship 1L, transferred to CCN and paid sticker 2L/3L)
Payments: $2K/month post-refi with SoFi in 2017. I got off to a slow start and still had $150K at the time of refi in 2017. Since then, I'd try to pay $4K/month and throw "extra cash" at the debt whenever possible (100% of tax refunds and bonuses). Did a 7 year fixed rate refi at 4% (down from blended 6-7% with the fed loans), figured I'd pay it off sooner than 7 years but didn't want to lock in too high of a monthly payment in case something came up.
Income: Biglaw scale, started at $160K, went in house and at ~$345K this year

Notes/Thoughts:
- The best loan repayment strategy is taking out less loans to begin with. I remember as a 0L thinking taking out the full recommended amount was the only option and that while it was a lot of money, it would all be easily repaid when making lawyer comp. That made everything easier at the time, but so much harder on the back end. First world problems for sure, but it's painful to be making a lot of money and have nothing to show for it.
- I'd strongly encourage 0Ls to retake LSAT to increase scholarships, work part-time during law school, live with parents or roommates, live frugally, don't spend money you don't have or inflate your lifestyle based on expected future earnings. You will thank yourself later. These loans are real money that you have to pay back every month out of your pocket. For every dollar you take out, you have to pay that dollar back, plus interest, plus missed opportunity to invest.
- The first couple years post law school I contributed to a 401k, but in hindsight I would have paused all investing until the debt was done. I know that may not be the "right" answer if market returns are higher than loan interest yada yada and obviously a personal risk tolerance call, but once I stopped the 401k, I became hyper focused on paying off my loans because I didn't like the idea that I was delaying investing/retirement planning. Now I'm a few years behind on retirement which sucks, but can invest more on a monthly basis without any debt payments, which just feels better to me personally.
- I would have refi'd sooner in hindsight. I could say that I wanted to make sure I had job security at my firm before I gave up the protections of federal loans, but in reality I just procrastinated and ended up paying a bunch more interest as a result.
- Was it worth it? Tough question. I took a big risk taking out loans to attend a mid-tier law school. I got really lucky that I was able to transfer to CCN and get a big law job which enabled me to eventually pay off the six figure debt. But at the end of the day, I've still spent the last 8 years working like crazy just to get back to even, which is a depressing thought. That said, I realize I'm in a great position moving forward, so all things considered I'd do it again.

Good luck to everyone repaying loans, there is a light at the end of the tunnel. 0Ls, please do yourself a favor and find ways to minimize your loans.

Omg. $345,000? Wow

Seriously! Where do you work to make this much?

I am sure that comp includes year end bonus and equity. But let's not throw this thread off too much. OP making that much in-house - mind sharing more at the below conversation?

http://www.top-law-schools.com/forums/v ... 3&t=279727

[cheaptilts]

Grad year: 2015
Debt upon starting repayment: $240k
Current debt: $165k
Salary: $255k
Savings: $50k (excluding 401k, which I half-maxed in 2016 and maxed in 2018 & 19)

Refinanced with SoFi at just under 5% fixed soon after graduation, then clerked for a year and made peanuts but still made the $2800 minimum payments during that year. Recently refinanced again at closer to 4% fixed with a lower minimum. Hoping to throw some bonus money at the loans this year before leaving BigLaw for good in 1-2 years once the debt is at a more manageable 5 figures. Don't own my home and am making car payments as well. Regretting attending CCN and foregoing significant money UVA and GULC offered.

how were you able to afford $2800/month on the JSP scale? The math doesn't seem to add up without outside sources of income.

[Anonymous User]

how were you able to afford $2800/month on the JSP scale? The math doesn't seem to add up without outside sources of income.

Original anon here. I clerked my second year out of LS and saved around $30k during my first year of BigLaw, a good chunk of which I used to service that debt. I would have paid more than my minimum during that first year of practice had I not had to budget for the clerkship.

[sparty99]

Grad year: 2018
Debt at graduation: $110k
Current debt: $68k
Salary: $190k
Savings: $15k

I was one of the people who decided to attend a school outside the T14 for significant scholarship money (most of my loans were for COL in an expensive city), and I am SO, SO glad I went this route. I got the "ideal" outcome of doing well in school and landing biglaw, and I'd hoped to stay 2-3 years to pay off the loans, but one year in and I'm so incredibly miserable. Planning my exit within the next 6 months; hoping to move to state government with aspirations of a $70k salary.

The question is, how should I prepare for this change? Obviously reducing monthly expenses--not that there are many other than a nice apartment I never see. But I'm moreso wondering whether I should continue to aggressively pay down the loans and only save a few months of living expenses, or if I should start moving to smaller payments and save more. I've been paying about $5-6000 a month, and am thinking I'll start paying more like $1500 to start saving.

Would love to hear any words of advice/encouragement that I will be able to survive on a much lower salary...tbh the thing that makes me the happiest is running and all I need for that is time.

Thanks guys!

I would not leave Big Law until you pay that off. With the $15,000 you have a 6 to 8 month emergency fund, at this rate, you can be debt free in 11 to 12 months. Which is only an additional 5 months. Perpahs you start looking at month 8 or 9 and start half-a$$ing your work or what have you so you aint depressed. I would make a seperate bank account where you just pile up cash and pay the minimum amount on your loans. Then once you hit 11 to 12 months. Dump everything to wipe out the debt.

[Neff]

Grad year: 2015
Debt at graduation: $100k (LS+Grad school) -- 0% interest loan from my parents.
Current debt: $0
Salary: $255k
Current net worth: $350k according to Mint

The 0% interest parent loan partly explains how I was able to pay off everything and accumulate so much net worth so quickly. I also live in a low COL state with no income tax, drive a cheap car, take only one domestic vacation a year, and my rent averaged about $1,500 a month for three years until I bought a $450,000 house this year. I am a minimalist who does not care for consumerism. Money means nothing to me other than the possibility of early retirement. Don't hate my job (long hours aside), but plan to quit biglaw soon and quit the law entirely around age 35-38 to do what I want to do (teach, travel around in an RV during the summer, write). I am married but my spouse currently doesn't work, she added a small amount to my net worth when we got married.

[Anonymous User]

2018 Grad
Current Loans: $240k - $2.3k payments at 4% interest
Salary: $155K + 25% bonus
Expenses: little to none--living with parents. Eating out with GF costs about $500 a month.

I'm thinking about bumping up my payments to 70% of paycheck (~$6k), and dumping my bonuses into loans so that I can be debt free before the end of 2022. Also thinking about refinance to FRB to 2.2% interest. Conflicted as to whether investing the money is better -- with an average 7% return.

Thoughts?

[TigerIsBack]

Grad year: 2017
Debt @ Graduation: $305k (some undergrad)
Current debt: $283k

Refi'd my loans with Earnest as a stub year with a 5.43% rate, 20 years, payment around ~$2100. Just refi'd again with Earnest and brought rate down to 4.51%, term is down to 14.5 years, and monthly payment ~$2300. Savings are probably around $20k in cash, and also been maxing 401k since I started. Plan to payoff loans much sooner than the 14.5 years especially now that my bonus/salary will increase pretty significantly going forward into my midlevel years. But like the comfort of having cash for unexpected expenses, needed vacations/getaways, and someday would like to buy a house.

Plan to stay in biglaw for as long as I can (the long haul ideally, but I'm still only a 3rd year, but so far the job/pay is worth the life trade offs for me).

[Anonymous User]

Sorry for posting anon, pure paranoia and self-consciousness about being identified. I’m thinking about my finances going forward and wanted to solicit TLS thoughts.

Debt at graduation: $207k ($92k to parents, which is a sweetheart loan but I do actually have to pay it back, and $115 in fed loans)
Interest rates: ~5.8% for the Feds, 2.5% for the family
Income: $195k (i.e. biglaw 1st year associate)
Savings: $10k (not counting some minor previous 401k contributions)
Other info: no credit card or other debt, job is in high COL major market, medium-term goal is to get enough for a home down payment.

I’ve been tracking the TLS hive-mind relatively loyally about finances, so am I right in thinking that the smart plan is: move into income-based repayment for initially smaller payments, work 6-12 months at the firm, make the minimum payments on my loans, create an emergency fund to cover 6 months worth of expenses, then refinance my fed loans? Because almost half my debt is to family, I assume my credit will appear better if I refinance, or somehow manage to get a mortgage, and if I fell on hard times my family wouldn’t break my kneecaps to keep the payments coming, so that’s a psychological relief. Half of it is left over from undergrad in any case. No idea where my career will go in the future (i.e. it’s not like I have some family business to eventually go to, and I have no idea how the whole biglaw/in-house/government/other??? professional path will shake out).

Thanks!

By way of update:

Debt: $183k ($87k to parents, which is a sweetheart loan but I do actually have to pay it back, and $96 in refi-ed loans)
Interest rates: ~1.3% for private, 2.5% for the family
Income: $200k (i.e. biglaw 2nd year)
Savings: $50k

I decided after a year I wasn't going to quit in a huff from biglaw and to actually ride it out for a bit, so I refi-ed my fed loans. Good credit and the autopay and corporate referral reductions got me down to 1.3% on 5 years, which means about $1,700 a month, which was better than I was expecting so I went for it. Having some savings made me less afraid about refi also, and it doesn't seem like interest rates will go up in the foreseeable future. Hardly seems worth aggressively repaying over saving at that rate, so now I'm just trying to build up a bit more towards a downpayment and work up the courage to buy property.

[babylawyer101]

Graduation year: 2019
Current debt: 100k (25k undergrad, 75k T14 law school, all federal loans 3-7%)
Salary: Big law market (but really 181,500 because I took a $8,500 advance which I spent on a bar trip)
COL: NYC ($2,200/month rent)

Brand new lawyer here, and I'm ready to devote my hard earned money to attempt to reach the heavenly world of being debt free. I have done a good amount of research on this topic, but I still have some questions, mostly regarding interest rates. I have an essentially perfect credit score. Currently I have an application pending for Sofi which offered me 4.054% for 7 years (the 5 year option was only 4.046% which I found odd). I spoke with an adviser at First Republic and they told me they would want me to have about $20,000 in liquidity which I would need to keep as my minimum balance in order to get their most preferential rates (which were ridiculously low). The way I see it, if I have $20,000 in cash, I would prefer to throw $15,000 of that money at my loans instead of having it sit in a First Rep account. Also, it would take me time to save up that much cash which would mean temporary higher interest rates. Do you agree that Sofi seems like the better option (even though I really wanted a rate below 4% from them)? Also, besides maxing my 401k, I am going to be paying these loans back at a rate faster than the 7 year required payment which is ~$1400/month. Any advice is welcomed. Thank you.

Side notes: (1) I co-signed my little brother's $40,000 student loan which could be bringing my rate up (2) I have no financial safety net from relatives.

(3) For anyone who cares, I was able to keep my debt lower than most because from the age of about 19 I made it a huge point in my life to try not to rely on student loans. I transferred back to my State undergrad school on a scholarship, I applied for dozens of scholarships and I worked multiple jobs. I choose my law largely based on the financial package they offered me.

[QContinuum]

COL: NYC ($2,200/month rent)

$2200/month in NYC is pretty impressive. Mind sharing which part of town you live in? Do you have a roommate?

[babylawyer101]

COL: NYC ($2,200/month rent)

$2200/month in NYC is pretty impressive. Mind sharing which part of town you live in? Do you have a roommate?

Haha sorry to disappoint,$2,200 is my share of the rent with my significant other. If you looking for good alternatives to NYC rent prices you may want to consider Jersey City/Hoboken (you also avoid the city tax this way) if you’re working on the west side or Long Island City if your working on the East side. Both are young, fun areas in my opinion.

[Anonymous User]

edit: okay... This will be long, confusing, and rambly, I'm sure. But NOT as confusing as Fedloan Servicing is making me... Would *LOVE* an actual resolution to this, although I highly doubt anyone will have any clue....

Thx for your time.

Anyways, I kinda sorta kinda figured out *some* of the answers to my questions as I went, so apologies for what's essentially rambles below. I decided not to delete because: 1) a lot of Fedloan's numbers STILL DON'T ADD UP!!! Like, wtf!?, and 2) I put a lot of my specific numbers in here in case anyone actually clicks this thread for what seems like it's original intent. In case anyone cares about that point: I graduated in '16 from a top5-10 or so, paid near sticker minus $ summering in biglaw both summers, and been in big-law-ish law (non-Cravath scale market) since, and have been REPAYEing since. I love REPAYE. It is an amazing feeling knowing that I can fuck off to travel or start a business or whatever and my loans will not hold me back from anything. And with a weighted average interest rate of just about 6%, that's really not that bad of an interest to just carry debt in life, and I'm totally fine with that. With the benefits of REPAYE (subsidized unpaid interest, payments able to drop to zero, and discharge after 25 years), I think the "effective interest rate" (i.e., accounting for these benefits) is outstanding, better than any private loan. These benefits are worth way more than 2% or whatever.

ANYWAYS, to summarize: in checking my payment history on Fedloan Servicing's site for the first time in a long time, I realized that I haven't been getting an interest subsidy from the REPAYE program as of February 2019, which coincidentally lined up exactly with the page break from page 1 to page 2. This lead me to believe the website was jaked up, a graphical or display error, or who knows.....

In reality, my calculated REPAYE payment is now just greater than my monthly interest payment.

HOWEVER, in MANY months, according to their payment history, I was getting interest subsidies when making larger payments than I am right now. And THAT is what makes zero sense to me. And, as shown in the ramblings at least once or twice below, Fedloan Servicing's numbers seem to CONSISTENTLY not add up. (P.S., I have a math degree in addition to graduate hard science degrees, so I'd likeeeee to think that my 7th grade math is right, but if I really did make a mistake, plz do point it out ).

Finally, I'd like to make clear that I wrote the above after realizing half of what's going on, whereas I wrote the below while pissed off believing that I was getting screwed. Edited lightly, but meh.




Okay so, wtf, any chance anyone here has experienced this, or knows wtf is up? I just got on the FedLoan Servicing website for the first time in ages. I'm praying this is a glitch in the website or some shit, or else this is just ridiculous and makes absolutely zero sense.

I've been on REPAYE for some years now, basically since it came out IIRC.

My loan balance is pretty damn high, so my payments don't cover interest. Specifically, my principal balance is $139,407.38; my unpaid interest is $2781.41; and thus my total balance is $142188.79.

I haven't budged my principal basically since my first ever REPAYE application was still pending, and I had to pay the 10 year plan payment or whatever. Since then, hasn't budged a hair.

Anyways, I'm looking through my payment history on this website OK? Here's the general summary, and at the end, the issue is apparent, among a couple points I point it out through this timeline.

• My interest last capitalized on 11/11/16, to a principal balance of $139,855.30. I guess this is what happens when you graduate or wtv.
• For some reason, I then have two interest subsidies, on 12/1/16 and 12/10/16, respectively, for $172.67 and $40.32. The 12/10/16 subsidy coincides with what I'm guessing is a 10 year estimated payment - $780.01.
• This brings my principal balance to $139,407.38 on 12/10/16, from which it has not budged since.
• Okay, still good so far. Scrolling up and clicking to more recent pages, the pattern seems to be payment and interest subsidy together on the 10th of every month, and then another interest subsidy on the 1st of every month. Don't understand what this is about - why are there two separate line items here for every payment?
• From my sub year or wtv, looks like I'm making $63.40 REPAYE payments, and still getting the two interest subsidy items for every payment.
• Along comes November 10, 2017 - looks like my REPAYE ran out and I'm back on the 10 year plan--payments go up to $701.39/mo. IIRC this recertification just took FOREVER. I didn't do anything wrong, I've been very diligent recertifying and stuff.
• January 10, 2018 - looks like my annual recertification was finally processed. Based on partial year income, my payment is only $238.72 - sweet! Still followed by two interest subsidies, but now the first one on the 10th with my payment is only $0.02 every month, but the one on the first of the month is for $235.62, so still getting that 50% subsidy I guess?
• Let's do some math here... gonna see if REPAYE's numbers match what they "should," or make sense, or..... something.... REPAYE pays 50% of unpaid interest, thus my Monthly Payment+2*Subsidies=monthly interest charge (ya, I know I could calculate it from the balances, but that would be a lot more effort--lots of different individual loans). Anyways, I=P+2S=($238.72)+2*($0.02+$235.62)=$710.00. Okay, I guess my interest charge per month appears to be $710.00, even. Umm. Coincidence that this comes out to a nice, even, $710?
• Unfortunately, this is WRONG. So WTF? And how is wrong? Well, like I mentioned, my principal has not changed since 12/10/16, and here we are at 4/1/2018. Nor have my interest rates changed, or any other parameter that aught to factor into the question of "How much is my interest payment?"
• I'll go ahead and show the calculations at the bottom of this point from my excel sheet, but, my daily interest is $23.12, which means that (in a 30 day month) my monthly interest is $693.65. Based on this, my $238.72 payment should have left $454.93 in unpaid interest, and thus the 50% subsidy should have been ~$227.46.
• Keeping on ... I keep paying my $238.72 REPAYE payment, until November rolls around again, this time 2018. My payments seem to be fluctuating a bit here for some reason, idk if it was issues getting approved again or something... really can't remember, but I do know that I have timely filed my REPAYE annual recertification every year, without a doubt.
• Even weirder here, I'm making consistent $238.72 auto-debit payments, yet the interest subsidy payments vary *substantially* basically every single month... For example, this is just a sequence of interest subsidies made on the 1st of the month (ignoring the $0.02 subsidies during the month), in order: $235.62, $201.26, $235.62, $235.62, $224.17, $235.62. So there's a mode of $235.62, but why the heck is it varying!?!? My payments aren't! My interest rates aren't! My principal isn't! So...wtf???
• In Nov. and Dec., 2018, my payments were $960.53, and after both, I got one interest subsidy (no more second tiny little $0.02 subsidy). Note, this is now at the top of page 2 of my payment history.
• The last (top) line item on this page 2 is another payment on 1/30/19 for $839.23. It's not on the 10th this time, because, IIRC, my bank changed my account number without me realizing it and I had to call FedLoan to get them to process it.
• Okay, turn to page 1 - the latest 20 transactions.
• The first (bottom) line item on this page says: "Interest Subsidy(See Details)" (as if the "see details" should be some kind of link - but it's not...) then in an amount of "--". That's right. ZERO DOLLAR subsidy!?!?!?!? I can even click on the "View Details," and see how it is applying $0.00 to every one of my individual loans.

Okay, that was when I realized the reason I wasn't getting subsidies anymore--because my $839 REPAYE payment is greater than my $694 monthly interest.

However, the whole reason this angered me, took me aback, etc.... Was that I WAS getting subsidized interest credits throughout the entire time I was making pretty widely varying payments. It appears I actually got a subsidized interest credit every single month from signing up, until 3 years after that. Almost like that's some sort of thing. Is it?

I do not have any subsidized loans, they're all just the regular Stafford and GradPLUS or wtv.

Moreover, I guess I was getting subsidized interest credits even after months in which my payment was not calculated according to REPAYE (during certification periods, or wtv). ANNNDDDD... I also got subsidized interest credits during this time following months when my payment was greater than my monthly interest charge. Like, what?? This all just makes noooo sense.

So, if anyone could reconcile any of this nonsense, I will either feel amazed by your wizardry, or feel like an idiot if I'm just missing some stupid ass thing...

Anyways.

Thanks for reading, and thanks for the advice.




P.S., in the original spirit of this thread, here's my loan #s, in case anyone's actually curious what 3+some years of REPAYE has looked like for me. Cheers.