Student Loans and the SAVE plan

Sanrith Descartes · Nov 30, 2023

So after diligently paying my student loans for the last 7 years or so, I decided to check out the new Biden Income based repayment plan aka SAVE.

Even with my income, it cut my monthly payment by 90% and as long as I make my monthly payment, no interest acrues.

Now ideologically I am firmly opposed to this executive order fuckery. That being said, fuck 'em. I didn't create this stupidity but I am surely gonna take advantage of it with all the tax dollars In have paid over my lifetime. If you have a student loan open, it's probably worth your while to take a peak at this. The application took 5 minutes and they show you the new payment before you hit submit. So you can model it without consequences.

Gravel · Nov 30, 2023

In this era of the country, not taking advantage of any free money the government gives you isn't noble, it's just being stupid. It's like taking a voluntary handicap on your own finances. It's why I manipulate my income so we can get ACA subsidies.

I'm pretty amazed at how much they're giving you. And also that it doesn't accrue interest. That's pretty bonkers.

Koushirou · Nov 30, 2023

Was going to make a thread asking about the best way to pay off the rest of my loans. I just went ahead and nuked my one variable loan back in August before interest started kicking back in. This no interest shit intrigues me, though. In the event I can't get on that shit, what is the most efficient way to pay this off? Obviously, my rate interest rate ones go first, but numbers-wise, do I pay off the low balance ones or the high balance ones first (I'm assuming also having to pay off all the interest first and then shoving stuff into specific principal).

Captain Suave · Nov 30, 2023

Sanrith Descartes said:
Now ideologically I am firmly opposed to this executive order fuckery. That being said, fuck 'em.

You can be right either way.

My grandparents were both against social security. My grandmother refused to deposit her checks on principle. My grandfather took his because he had paid in already and was going to at least get his money back.

Sanrith Descartes · Nov 30, 2023

Koushirou said:
Was going to make a thread asking about the best way to pay off the rest of my loans. I just went ahead and nuked my one variable loan back in August before interest started kicking back in. This no interest shit intrigues me, though. In the event I can't get on that shit, what is the most efficient way to pay this off? Obviously, my rate interest rate ones go first, but numbers-wise, do I pay off the low balance ones or the high balance ones first (I'm assuming also having to pay off all the interest first and then shoving stuff into specific principal).

Honest question. What is you AGI on your 2022 taxes and what is your family size? This is all you need to determine the amount you will be paying back. And the amount will drop in 2024 when more changes are set to occur.

Sanrith Descartes · Nov 30, 2023

Captain Suave said:
You can be right either way.

My grandparents were both against social security. My grandmother refused to deposit her checks on principle. My grandfather took his because he had paid in already and was going to at least get his money back.

I felt the exact same way about my first EV credit. I disagree with the $7500 credit, but since they chose to pass it, I put that bitch in my pocket.

Palum · Dec 1, 2023

Koushirou said:
Was going to make a thread asking about the best way to pay off the rest of my loans. I just went ahead and nuked my one variable loan back in August before interest started kicking back in. This no interest shit intrigues me, though. In the event I can't get on that shit, what is the most efficient way to pay this off? Obviously, my rate interest rate ones go first, but numbers-wise, do I pay off the low balance ones or the high balance ones first (I'm assuming also having to pay off all the interest first and then shoving stuff into specific principal).

Do you have private, state or federal loans? If they are public, do you know what program code they are?

Long story short depending on when you went to school it's either very simple or very complex. The easiest is to get the summary data from NSLDS. If you have only direct Stafford loans left or a consolidation loan with ED (though it would be serviced by another company) you just need to pick the best repayment program for your situation. If it's just full repayment of the loans, the best interest accrual situation and pay unsubsidized loans off first in highest interest order on top of your minimums.

If you still have some FFEL loans, those are more complicated. There's also edge cases like Pell overpayments or TEACH act loan conversions or things like that.

Palum · Dec 1, 2023

Also, just a note if anyone is really struggling, SAVE actually lets married couples file separately. If you currently file jointly but a low income spouse has the large loan balance, that alone could cut your total combined loan repayment.

Also, they are apparently allowing early forgiveness on under 12K to ten years. Coupled with rules changes to count deferral periods, this means potentially that even high income people who are in that zone and have been making 10 years worth of payments or deferrals could swap to SAVE next year (maybe out of a 30 yr) and immediately apply for 12K in funny money (though you still get the 1099). Will have to see how that plays out because that seems like a free 12K min to any savvy borrower right now...

Zzen · Dec 1, 2023

Fucking pinko commie bastards.

Sanrith Descartes · Dec 1, 2023

Palum said:
Also, just a note if anyone is really struggling, SAVE actually lets married couples file separately. If you currently file jointly but a low income spouse has the large loan balance, that alone could cut your total combined loan repayment.

Also, they are apparently allowing early forgiveness on under 12K to ten years. Coupled with rules changes to count deferral periods, this means potentially that even high income people who are in that zone and have been making 10 years worth of payments or deferrals could swap to SAVE next year (maybe out of a 30 yr) and immediately apply for 12K in funny money (though you still get the 1099). Will have to see how that plays out because that seems like a free 12K min to any savvy borrower right now...

For anyone here with a student loan, its worth logging in and taking a look at it. The process is quite painless and considering its the gubmint, its quite shocking.

This site is for the application and it can also pull up all your student loan info.

https://studentaid.gov/fsa-id/sign-in/landing

Sanrith Descartes · Dec 1, 2023

Zzen said:
Fucking pinko commie bastards.

Furry · Dec 1, 2023

Sanrith Descartes said:

Aren't you like 80 years old, why are you still repaying student loans commie.

Sanrith Descartes · Dec 1, 2023

Furry said:
Aren't you like 80 years old, why are you still repaying student loans commie.

I went to college when I was about 50. Loans were subsidized so low interest rates so I took the loans and invested it in the S&P500

Furry · Dec 1, 2023

Sanrith Descartes said:
I went to college when I was about 50. Loans were subsidized so low interest rates so I took the loans and invested it in the S&P500

So you just stole money from the government to invest in stonks? Looking at the pillow I'm putting in my bag so I can nap on the clock, doesn't look like it'll be fair for me to judge.

Aldarion · Dec 1, 2023

Palum said:
Also, they are apparently allowing early forgiveness on under 12K to ten years. Coupled with rules changes to count deferral periods, this means potentially that even high income people who are in that zone and have been making 10 years worth of payments or deferrals

This is exactly what let me get 100% of mine forgiven early this year (PSLF program). I think theres a cap in place now but I got all mine wiped out. >60k

Sometimes clown world takes your money, sometimes you eat the bear.

Sanrith Descartes · Dec 1, 2023

Furry said:
So you just stole money from the government to invest in stonks? Looking at the pillow I'm putting in my bag so I can nap on the clock, doesn't look like it'll be fair for me to judge.

They offered to loan me the money. I tried to say no but they insisted. Don't blame me because I studied Finance and Econ and can do time value of money equations.

Sanrith Descartes · Dec 1, 2023

Aldarion said:
This is exactly what let me get 100% of mine forgiven early this year (PSLF program). I think theres a cap in place now but I got all mine wiped out. >60k

Sometimes clown world takes your money, sometimes you eat the bear.

And the best part is the forgiveness doesn't count as income like it would if a credit card debt was waived away.

Mist · Dec 1, 2023

Gravel said:
In this era of the country, not taking advantage of any free money the government gives you isn't noble, it's just being stupid. It's like taking a voluntary handicap on your own finances. It's why I manipulate my income so we can get ACA subsidies.

I'm pretty amazed at how much they're giving you. And also that it doesn't accrue interest. That's pretty bonkers.

Yeah I try to explain this to people on both sides of the spectrum all the time.

You do not get any bonus points awarded at the end of this game for choosing to play it badly.

Sanrith Descartes · Dec 1, 2023

Gravel said:
In this era of the country, not taking advantage of any free money the government gives you isn't noble, it's just being stupid. It's like taking a voluntary handicap on your own finances. It's why I manipulate my income so we can get ACA subsidies.

I'm pretty amazed at how much they're giving you. And also that it doesn't accrue interest. That's pretty bonkers.

Our payments will drop to zero next year when I file our 2023 taxes and include the amortization and depreciation on the business and office building we bought this year.

London Comedy GIF by Don't Hate The Playaz

Tuco · Dec 1, 2023

Because I paid off my student loans I can righteously state that anyone who takes advantage of this is stealing from me personally.

Also I hope this makes it so that my kids aren't burdened with debt and my savings aren't annihilated with overpriced tuition costs.

Student Loans and the SAVE plan

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