Celebrating 10 years! 2007-2017

IBR sort of defeats the idea of Capitalism.

I've been on IBR for what feels like ages now. Got a new job shikes12/02/17
I consolidated my loans, could I even do ibr? notreallyalawyer12/02/17
Yes, as long as you consolidated with the government. guyingorillasuit12/02/17
I consolidated with my then lender or the access group and n notreallyalawyer12/02/17
Yes but be careful. Don't pull a coco. I paid IBR for two ye cocolawyer12/11/17
IBR and loan forgiveness aren’t the same thing. You can do downwardslope12/11/17
Put more pre tax dollars into a 401k or IRA contribution. trollfeeder12/02/17
that doesn't make sense. $1000 increase $150 higher IBR dingbat12/02/17
Actually he said 25k, so it is closer to a 2,000.00 a month cocolawyer12/11/17
I can't tell if a troll or a humble brag lol Did you borr triplesix12/11/17
What in the world are you talking about? I borrowed money ba shikes12/11/17
Well, sooner or later it will end. Either the loans will ge caj11112/12/17
I only make 40k year but have monopoly money loans. Wife ma david6198312/12/17
why don't you pay your debts like an ethical person? dietcoke12/12/17
By legally minimizing his payment allowed under a contract h shouldalearnedmath12/13/17
I pay my credit cards, my mortgage, and my car payment. I d david6198312/12/17
But the lender didn't scam you, the law school did. Sue the caj11112/12/17
Yeah a lot of good that suit would do. david6198312/12/17
Of course the lawsuit would go nowhere, but that's not the l caj11112/12/17
Then the government should change its policies and stop allo david6198312/12/17
After 25 years since the day you borrowed the loans will be caj11112/12/17
That's why I socked away 50k into Vanguard Index Funds. I d david6198312/13/17
The 25 year tax bomb has so many variables that it doesn't r shikes12/14/17
"Frankly, I'm not sure why some random Bernie enthusiast doe thirdtierlaw12/15/17

shikes (Dec 2, 2017 - 1:12 pm)

I've been on IBR for what feels like ages now. Got a new job with a solid (25k) raise last year, just had my IBR re-certified. Between the tax hit I take by jumping into a new tax bracket due to my raise, and the added IBR payment from the raise, I am literally pulling in an extra $100 a month as opposed to a year ago. Awesome.

The entire idea of capitalism was prosper through hard work, dedication and advancement. I don't even see the point of raises or bonuses anymore, if I'm gonna get jammed up on the front end with more taxes, and then get killed on the backend with a higher loan payment, I'm not entirely sure how working harder and trying to advance benefits me. Maybe those that decided to just stick it out in PD/ADA/PI positions for 10 years had it right all along. Take your lumps with a minimal IBR payment for 10 year, get out, then jump ship for double the salary.

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notreallyalawyer (Dec 2, 2017 - 1:17 pm)

I consolidated my loans, could I even do ibr?

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guyingorillasuit (Dec 2, 2017 - 3:58 pm)

Yes, as long as you consolidated with the government.

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notreallyalawyer (Dec 2, 2017 - 3:59 pm)

I consolidated with my then lender or the access group and now it’s 3 places over

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cocolawyer (Dec 11, 2017 - 7:34 pm)

Yes but be careful. Don't pull a coco. I paid IBR for two years then consolidated...now my IBR time started all over. So instead of 5 years in I am only 3. So lesson of the day is...be careful.

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downwardslope (Dec 11, 2017 - 8:23 pm)

IBR and loan forgiveness aren’t the same thing. You can do IBR with any federal loan, consolidated or not. I did IBR without consolidating my loans... it is not required. You just can’t get loan forgiveness; however, I didn’t really want to consolidate and it worked for me at the time. I know people who have been doing variations of IBR/ICR for probably 2 decades or more now and they’ve never had any loans forgiven (unless they just did).

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trollfeeder (Dec 2, 2017 - 3:02 pm)

Put more pre tax dollars into a 401k or IRA contribution.

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dingbat (Dec 2, 2017 - 4:01 pm)

that doesn't make sense.

$1000 increase
$150 higher IBR payment
$76 Payroll taxes
$500 Combined State & Federal & City increased taxes (assumes combined 50%, which is as high as it gets)
$30 401k contribution (3%?)

Net increase $244

Not included is any adjustment for ACA subsidies. That could actually eat up the difference, I think (does anyone actually udnerstand how the ACA works?)

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cocolawyer (Dec 11, 2017 - 7:37 pm)

Actually he said 25k, so it is closer to a 2,000.00 a month increase.

Yeah I also do not know how that makes sense. It is not going to be a lot, but if your take home before was 6k it should be close to 6800 now (considering IBR is getting a piece). That's still 800 you didn't have before. That's a new car payment, insurance, registration, and gas for the month. That's pretty significant. Or its daycare for the month.

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triplesix (Dec 11, 2017 - 7:38 pm)

I can't tell if a troll or a humble brag lol

Did you borrow the money? Did you get a job according to qualifications?

At what income level do you think it would be fair for taxpayer to expect you to pay for your student loans?

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shikes (Dec 11, 2017 - 8:34 pm)

What in the world are you talking about? I borrowed money based on statistics saying that I was going to make 150k+ straight out of law school. I actually made 50k out of law school. I now make 90k. I have 200k+ in loans (undergrad + grad). About a third are private loans. With my wife's income (also a ton of student loans) we jump a bunch of tax brackets. Its absurd that I can't afford a house in a decent neighborhood while living in an "upper middle class" tax bracket. If we went on a 10 year standard our loan payments would be ~4500/mo.. Add in $1500/mo. for the private loans we have been paying.

IBR for life, sadly. Just impossible to get ahead on it. My review doesn't really even matter anymore. I can get a raise and I'll just lose 75% of it on tax/IBR increases. Whats the point?

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caj111 (Dec 12, 2017 - 8:19 pm)

Well, sooner or later it will end. Either the loans will get paid off eventually, or, 25 years after you took the loans out, they will be forgiven. Of course, the forgiven loans will be taxable income to you, so you'll have a new debt at a likely higher interest rate if you can't pay all the added tax liability at once, but at least the balance of the debt will be a lot less.

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david61983 (Dec 12, 2017 - 9:08 pm)

I only make 40k year but have monopoly money loans. Wife makes bank so we file separately. I put the max 18k into my 401k each year so my monthly payment on IBR is zero. It's a pretty sweet deal although the government should just forgive the loans and then go after the schools for cooking the books.

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dietcoke (Dec 12, 2017 - 9:17 pm)

why don't you pay your debts like an ethical person?

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shouldalearnedmath (Dec 13, 2017 - 1:56 pm)

By legally minimizing his payment allowed under a contract he is paying his debts like a reasonable person.

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david61983 (Dec 12, 2017 - 9:20 pm)

I pay my credit cards, my mortgage, and my car payment. I don't pay my law loans because I was lied to. Had my law school told me the truth I never would've gone. They lied.

Sorry but when someone is scammed they usually don't feel any moral obligation to repay that debt.

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caj111 (Dec 12, 2017 - 9:34 pm)

But the lender didn't scam you, the law school did. Sue them, then use the settlement or damage award to repay the loans. Meanwhile, us taxpayers get to absorb what do you don't pay.

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david61983 (Dec 12, 2017 - 9:53 pm)

Yeah a lot of good that suit would do.

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caj111 (Dec 12, 2017 - 9:56 pm)

Of course the lawsuit would go nowhere, but that's not the lenders or the taxpayers' problem. You're screwing over the parties that are not the ones that screwed you.

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david61983 (Dec 12, 2017 - 9:52 pm)

Then the government should change its policies and stop allowing these ridiculous loan amounts which jack up tuition to astronomical rates. And I'd be willing to repay the principle if they'd forgo the interest. It's ridiculous that I have an interest rate nearing 8% while some of those that graduated just a few years before me got rates close to zero. About half of my loan balance is interest.

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caj111 (Dec 12, 2017 - 9:58 pm)

After 25 years since the day you borrowed the loans will be totally forgiven but it will become taxable income to you. The debt will be smaller but I can assure you the IRS has no such IBR program.

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david61983 (Dec 13, 2017 - 9:43 am)

That's why I socked away 50k into Vanguard Index Funds. I doubt there will be a tax bomb though. There is none for PSLF and those are gov't employees who are making good money. It's the private sector employees who are hurting.

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shikes (Dec 14, 2017 - 9:27 pm)

The 25 year tax bomb has so many variables that it doesn't really bother me. Worst case scenario, I will sock away some money and pay it off. But really, I think IRS will likely do a small-ish payment plan. There will be a ton of people who will try out the tax bomb before I do, and the government will likely be pushed to do something about it when it explodes.

Frankly, I'm not sure why some random Bernie enthusiast doesn't run on the platform of "all loans forgiven if you elect me". I think he would run away with the election.

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thirdtierlaw (Dec 15, 2017 - 6:56 am)

"Frankly, I'm not sure why some random Bernie enthusiast doesn't run on the platform of "all loans forgiven if you elect me". I think he would run away with the election."

You severely overestimate the public's support for forgiveness. Half the population has minimal to no college loan debt. There is also a subset of the population who look down at college grads as elitist. Look at the comments on any articles discussing forgiveness programs. It's filled with comments of "pay your debts" or "I don't care if the school was shut down for fraud, they should have known better! It's not the tax payer's job to bail them out."

Any conversation about how the debt is nondischargable in bankruptcy, compared to all other debt, is lost on deaf ears. Same with any mention that the government contributed greatly to this problem with the blank checks they wrote, and the idea that many people, wrongly, believe that the government wouldn't keep writing blank checks to schools that they know are a scam.

That isn't even getting into the more complicated arguments about putting any "moral imperatives" aside, how student debt is hurting the economy.

I've always said we are going to see debt forgiveness become front and center once these boomers retire with no savings except their house now valued at $1mil, but can't find anyone who can afford to buy it.

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