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Forging ahead in 2015

Hello, my fellow debt slaves. Contrary to extensive and prominent media reports, I am still very much alive and still very much in debt. It was difficult to maintain my thrifty habits during the holidays and New Year and I’ve fallen into the ridiculously wasteful habit of buying my lunch. I have resolved to return to my monkish habits in February. The H.M.S. Mr. LawSchoolDebt has already sprung enough fiscal leaks over the year and I can’t tolerate further punctures to my checking account if I am to avoid a Titanic-esque situation.

Without further adieu, here is where the law school damage stands:

Principal Accrued Interest Interest Rate Total
$21,907.62 $78.63 6.55% $21,986.25
$35,442.37 $236.03 7.65% $35,678.40
$23,204.23 $83.28 6.55% $23,287.51
$43,843.44 $192.19 8.00% $44,035.63
$24,241.18 $83.68 6.30% $24,324.86
TOTAL: $149,312.65

killingmeIn other words, I’ve made almost no progress on my debt over the last couple months. Even though I’ve made several not-insignificant payments over the last 60 days, the interest rate is KILLING me! I’m in the beginning stages of examining some refinance options. The 8% and 7.65% interest rates on a couple of my loans are criminally usurious in my biased opinion.

I’m concerned that if I leave the government repayment programs, I won’t have the protection of IBR, which establishes a very low base monthly payment – a feature that would come in handy were I to get canned at work. I’m not concerned that would happen, but you never know and I’ve experienced extended periods of questionable employment after law school, so I feel that it’s prudent to prepare for worst case scenarios. Law school and my post-law school experience has absolutely bashed the naive optimism (some might say delusions of grandeur) I previously had as a late 20-something.

I got a little bump in pay at work, but I’m still making in the $50,000 range, which needless to say, is nowhere near enough to pay off my law school loans. People hear law grads complain about $40-60k salary ranges, which probably sounds ridiculous to the average person, but when you take into account huge law school loans, these salaries really aren’t enough to pay rent, food, car payments, and God forbid, live a life in most American cities.

I’m still exploring other employment options, but I don’t want to jump into something new without having a thorough understanding of a career and its opportunities. I did that once with law and I don’t plan on making the same mistake again.

In January, I addressed a couple small money issues that can add up by canceling my LinkedIn premium account and downgrading my gym membership. I’ve also stopped my bad habit of buying books on impulse.

So there you have it, folks. I promise to update more often going forward. I hope everyone else in Debt Land has been staying the course and doing their best to hack away at their personal debt monster. Here’s to a fiscally responsible 2015!

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10 responses »

  1. I definitely don’t have the possibility of IBR now that I’ve refinanced, but maybe you can refinance just the 8% loan or maybe the 7.65% since it’s a little smaller? I put my extra payments on my lowest interest loans right now because they have other aspects (a co-signer) that make them my highest priority.

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    • I’m looking into that strategy currently – refinancing just one of the loans. I appreciate the protection of IBR, but the interest rates I’m locked into are akin to a payday lender.

      I’m sure your co-signer appreciates your responsibility!

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  2. Hey, I’m really glad to see you back! You’re a great writer and I was sorry that it looked like you’d stopped blogging. On the practical issue, I agree that your interest rates really suck. I’ve heard of a couple people having good luck with SoFi (but have no personal experience.) It does seem like exploring a refinance to something more like a 5% rate could make a lot of difference to you with those two. I guess look into hardship options with your theoretical refinancers? Does anyone have some kind of deferral program in case of temporary job loss? Good luck!

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    • Awww well thank you, ma’am!

      I’m actively exploring refinance options and will blog about it. I’ve read that SoFi will work with you if you lose your job, but there must be limits to that and the protections aren’t as robust as IBR. Because so many people carry huge student loan burdens, there are now a good number of banks and private companies involved in student loan refinancing services. SoFi advertises a lot but they’re not the only game in town.

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  3. I feel your pain about interest payments. One of my loans is like 9.75%, which means what I am paying now only allows me to make interest payments on that loan. I am seriously considering refinancing it because…ugh 9.75%. You have a great writing style and I look forward to future posts!

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    • Gah! 9.75% sucks so bad. My condolences and believe me, I feel your pain with my largest loan at 8% (also had one at 8.55% that I was able to retire). Student loan interest rates are scandalous given the current interest rates available for other commercial endeavors.

      I also look forward to reading your material and eagerly look forward to the day when we escape debt slavery.

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  4. Yes. Those interest rates. Ouch. Best of luck refinancing. It is so ridiculous that you can’t refinance student loans when you can refinance so many other things. I hope you find some relief!

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    • Hey Kate, I added your excellent site to my blogroll. Thanks for the comment.

      You can refinance student loans, but I would lose the protection of IBR. Under the Income-Based Repayment program, if I lose my job, I can just pay the minimum amount of $400 or so under the plan. With the refinancing companies (SoFi, CommonBond, etc.), I’m at the mercy of a for-profit company and its venture capital backers – a situation unappealing to me. My experience with law school and post law school employment opportunities has made it abundantly clear that I must prepare for the worst case scenario and have a contingency plan. If I leave the protection of IBR, I don’t have enough savings or career equity to justify taking that risk. With IBR, I pay more interest (although I’m making payments far above the IBR minimum, which wouldn’t even cover interest), but I have the protection of a low minimum payment. SoFi, CommonBond, and others claim to work with borrowers if they lose their job or experience employment troubles, but that’s really not enough of an assurance or guarantee for me to take the risk and dive in.

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  5. I didn’t go to law school, but I do have six figures of student loan debt. I understand the hell you going through. And I can’t get a sugar daddy to pay my debt either, so I can relate to your frustration there, too. 😉 Post again and tell us how you’re doing.

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    • Thanks for the comment! Just posted an update. I’m in the same boat – single with huge, seemingly insurmountable debt. I also added your blog to my link list. Keep on keeping on with the debt! The Internet is an awesome place to commiserate with those who are experiencing similar struggles.

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