Over $300k in student loans - help.

[friendlyskies]

I am single, in my late 20s, and I have about $65,000 in private loans and $255,000 in federal loans. I was a minor when taking out the majority of those loans over 10 years ago, and basically at the behest of my parents, who said they needed the money for living expenses. I am no longer on speaking terms with them. I have consulted with a lawyer since, who was sympathetic but advised that legal costs and the drawn-out nature of the legal system would mean that I could end up with even more debt and it could easily take 8+ years to reach a resolution. I have decided against a lawsuit, especially since I have recently heard that my parents are in poor health (one has a terminal diagnosis).

I am a relatively new grad RN. The average starting salary here is about $58-60,000. I am completing an NP certification (paying out-of-pocket) and expect to complete it in 2 years, which will boost my earning potential. However, even if I live as a pauper, I will spend at least 10 years paying off the loans.

I have spoken to several advisors and PSLF is an option if I continue working for a nonprofit hospital or other organization for 10 years, which is still a long time, but at least it frees up some money for retirement/investment/etc. If PSLF fails, I can use that money towards paying off the loans. It's obviously a risk. Does anyone have any other ideas on what I could do? I've looked into the NHSC repayment option but I'm not sure it would help much, since most of my loans are not from nursing school.

I'm having a hard time dealing with the reality of this burden. I want to do normal things like save for retirement, maybe get married, buy a small house. It feels like I'll be losing 10 years of my life to loans that my parents used. It really sucks.

[DannyBoy8, RN]

25 minutes ago, londonflo said:

99% of those turned down can't be because they did not read the directions.

Could you elaborate on your statement? I know you meant it to be funny, but I am assuming you based it on accurate examples or info you have.

That portion of my post was not meant to be funny. You shared an article from 2018. You may want to review the latest PSLF reports available on studentaid.gov. 280,000,000 has been disbursed as of June 2020.

Anyone can literally submit an application, and when anyone does, well the numbers are going to reflect that. Hell, why not submit an application even if you know that you're ineligible, you may just get lucky and sneak through the crack.

Most people are rejected because they did not even have enough qualifying payments. AKA they cannot count to 120. Some folks don't even have eligible loans!!! Others didn't document their employment correctly, or weren't even working in an eligible job! Read the guidelines, stop the hand holding!

[londonflo]

1 hour ago, DannyBoy8 said:

Most people are rejected because they did not even have enough qualifying payments. AKA they cannot count to 120. Some folks don't even have eligible loans!

You are so right. I was unable to open the 2020 data or earlier as it said I needed an app but did not say what app. I don't know why I was surprised with what I found.

This is old (2017) but I did find a pie chart that illustrates what you said.

Quote

Exhibit 6 shows the most common reasons for the rejection of PSLF applications. To be sure, few applicants have been granted forgiveness under the PSLF program; however, this trend is likely to reverse in the future. Congress enacted the PSLF program in October 2007, and, as a practical matter, applicants could only meet the 120 payments requirement beginning in October 2017. The passage of time should allow more individuals to meet this requirement and encourage new waves of applicants.

I do have to add you are talking to a retired teacher who dealt with "those that never bother to read or follow the directions" for 40 years.

In my last year before retirement, I taught a pharm course and had students complete ATI templates on specific meds. This was to introduce them to filling out medication cards * ( I outlined exactly what to include. The forms to use had the actual headings adequately placed. I gave them the number of forms needed. I put extras where we put the ATI forms at. I put the actual page numbers on the direction sheet as to where the medications could be found. ) I figured this would be easy points for the students (some students were low C's, D's, and failing.)

You can predict the outcome. At least 20% missed some piece of information directly requested. At least 5 (of 48) didn't complete all the sections or did not do all the medications.

* I am not impressed with using medication cards as an activity to learning medications but the other faculty did, many swear by it). I don't learn by writing things out but many of our students wrote out flash cards and rewrote their notes so that activity works for them. It is amazing the different ways people learn. I guess that's why a whole industry around it has sprung up.

PS I put the actual page numbers in the book so that the correct insulin was covered, so combination drugs were not used for single ingredient drugs etc. This course was required their first semester and they had no clinical experience yet. I did want them to leave the course being able to use their drug handbook.

[murseman24, MSN, CRNA]

19 hours ago, Hopesandsdreams said:

Girl, you NEED Dave Ramsey. He will change your life, there is hope.

as far as the 10 year working for a nonprofit and them forgiving your loan, thousands of people have applied for that and I believe it is like less than 10% are being excepted. It is literally a scam. Do not rely on that at all! $300,000 is a crazy amount of debt, however once you’re done with NP school you will have a really big shovel to dig your way out of the mess you made. As an NP you should be making around $100,000 a year. If you live frugally, you should be able to pay that off in about 4 years. This means not owning a brand new car, not going out with friends every weekend, not taking vacations that you can’t afford, not buying clothes or nice things, because you don’t have the money to do that. But once that weight is lifted off your shoulders and you’re debt free, it is an amazing feeling. It is so worth it and I know you can do it.

as a general rule once your debt:income ratio is over 2 (You owe twice as much on your student loans than what you make per year), you end up paying less money in the end by stretching out your payments for 20 yrs than by paying off the loan. Gross 100k with 300k loan is like digging a ditch with a hand trowel. No, you cannot pay that off in 4 years if you're making 100k even if you eat ramen every day and sleep under a bridge to avoid paying for housing.

[DannyBoy8, RN]

Dave Ramsey is for sheeple. Get out a financial calculator and figure it out. Carrying debt isn't necessarily the worst choice depending on the opportunity costs (interest rate vs expected investment gains).

[murseman24, MSN, CRNA]

On 8/26/2020 at 7:43 PM, DannyBoy8 said:

Dave Ramsey is for sheeple. Get out a financial calculator and figure it out. Carrying debt isn't necessarily the worst choice depending on the opportunity costs (interest rate vs expected investment gains).

Some of his advice is just plain wrong.  He advises foregoing contributing to your 401k until all of your debt is paid off and not carrying a credit card.  He has an axe to grind and has made his fortune being an extremist.  He is debt averse to a fault and any public financially literate voice thinks he's just a businessman selling a product.  He preys on the financially illiterate so they buy his products.

[Hoosier_RN, MSN]

1 hour ago, murseman24 said:

Some of his advice is just plain wrong.  He advises foregoing contributing to your 401k until all of your debt is paid off and not carrying a credit card.  He has an axe to grind and has made his fortune being an extremist.  He is debt averse to a fault and any public financially literate voice thinks he's just a businessman selling a product.  He preys on the financially illiterate so they buy his products.

maybe? but I borrowed his materials from my library, made copies, an got myself out of enormous debt.  He may work for some of us, not for others, kind of like some other plans

[The0Walrus, BSN, RN]

Is that over 300k for your RN, BSN and living expenses? That's so much debt... I don't even want to say how much I paid for my degree altogether, but I went to a community college and state school which was the cheapest in the state.

I don't even know what your monthly payment would be but the interest alone is staggering. I mean at least you can write off some of that interest in taxes. You have to do a lot of per diem shifts. That's what it comes down to at this point. Maybe you can try to invest some of that into real estate. I don't know how one gets such high loans. Good luck!

[murseman24, MSN, CRNA]

On 8/27/2020 at 10:10 PM, Hoosier_RN said:

maybe? but I borrowed his materials from my library, made copies, an got myself out of enormous debt.  He may work for some of us, not for others, kind of like some other plans

Congratulations, that's a big deal.  If everyone followed his principles there would be much less financial hardship for sure.  It's a great base to get yourself out of the hole and back in the positive.  Once you get to the point where you can budget effectively and pay off bad debt if you want to make the best use of your money, it's at that time people should move on from Dave Ramsey to learn some basic investing principles.

[Mergirlc, MSN, APRN, NP]

On 8/27/2020 at 7:44 PM, The0Walrus said:

Is that over 300k for your RN, BSN and living expenses? That's so much debt... I don't even want to say how much I paid for my degree altogether, but I went to a community college and state school which was the cheapest in the state.

I don't even know what your monthly payment would be but the interest alone is staggering. I mean at least you can write off some of that interest in taxes. You have to do a lot of per diem shifts. That's what it comes down to at this point. Maybe you can try to invest some of that into real estate. I don't know how one gets such high loans. Good luck!

I thought the same thing.  I plugged in some figures using a student loan calculator based on the following assumptions:

$300K Loan   /    5% fixed interest   /  10, 15  and 20 years payment plans

10 years:  $3182 per month

15 years:  $2372 per month

20 years:  $1980 per month

Obviously the interest would be the wild card in this scenario since we're not sure what interest OP had when she got the loan, but holy #@*!!  This makes me ? just looking at this.   If this was a monthly house payment, it would be one thing, but this just money going out.    Yikes!

[murseman24, MSN, CRNA]

5 hours ago, Mergirlc said:

I thought the same thing.  I plugged in some figures using a student loan calculator based on the following assumptions:

$300K Loan   /    5% fixed interest   /  10, 15  and 20 years payment plans

10 years:  $3182 per month

15 years:  $2372 per month

20 years:  $1980 per month

Obviously the interest would be the wild card in this scenario since we're not sure what interest OP had when she got the loan, but holy #@*!!  This makes me ? just looking at this.   If this was a monthly house payment, it would be one thing, but this just money going out.    Yikes!

exactly why an income-based repayment plan going for loan forgiveness after 20 years is the way to go.

[Leader25, ASN, BSN, RN]

On 8/18/2020 at 10:32 AM, friendlyskies said:

I am a relatively new grad RN. The average starting salary here is about $58-60,000. I am completing an NP certification (paying out-of-pocket) and expect to complete it in 2 years,

You say you are a new grad,yet you are completing a program that you will not "complete"until  two years from now.It is too late to buy a life insurance against your parents.You have to hunker down and pay it off because the interest will kill you.As your salary goes up you will be paying more taxes,so lower your tax rate  by getting auto decductions into a 403 b ,usually employer sponsered.Best of luck to you.

[Leader25, ASN, BSN, RN]

On 8/27/2020 at 10:10 PM, Hoosier_RN said:

maybe? but I borrowed his materials from my library, made copies, an got myself out of enormous debt.  He may work for some of us, not for others, kind of like some other plans

Agree,his advice is free to those willing to listen,it is free on U tube ,the radio .You can take what you can from his advice,research,be aware,and learn to discipline your spending.