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Old 06-08-2016, 07:32 PM   #21
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@Rodi - thank you - I think tracking year over year balances will be motivating.


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Old 06-08-2016, 07:35 PM   #22
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Thanks for the feedback - our wedding is now "paid for" - but honestly that is where about 5k of the credit card debt came from...the other from our unexpected move where we lacked an appropriate emergency fund. We will definitely not be adding any more. I was all about eloping and fiance wouldn't have it!


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Old 06-08-2016, 07:36 PM   #23
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@ivinsfan - thanks for your feedback! I started reading this forum during my internship/residency a couple years ago (we both do have advanced degrees that required 6 years after undergrad to be completely done). At that time, we didn't have retirement savings, had already purchased the cars, et cetera. Since then our income has risen dramatically so I do think the forum has helped, though I wish I would have found it in my early 20s!

Thanks again for taking the time to comment!


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Old 06-08-2016, 07:49 PM   #24
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Good Luck, overwhelming school pressures and time constraints mean sometimes we so busy at just getting along that things add up and we can't look long term,.

I'm getting the idea you couldn't focus on money until you worked thru all of these things. Also after so many years of schooling you feel you should reap some rewards for your efforts.

Just power thru and watch your daily spending.....it seems like your income numbers should rise and that will help you as well.
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Old 06-09-2016, 05:00 AM   #25
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I must admit I'm somewhat appalled that one would take a job that enabled them to extinguish significant school debt (at taxpayer expense) only to quit the job once the debt is discharged. The OP seems extremely earnest and it is not she that I am put off by, but the concept that one would intentionally rack up such enormous debt with the goal that some government program will erase it. I also would hope that six years of additional post grad education would mean entry into a line of work that pays well, otherwise how would one be able to pay off the associated debt of so many years of medical school.
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Old 06-09-2016, 06:58 AM   #26
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+1 on trying to take advantage of the loan forgiveness program - I think working at a job you hated for 4 or 5 years to have that big nut retired (with no income tax implications!) is huge.

I also want to ++1 on the wedding comment that @ivinsfan made. Weddings are a notorious money pit and unfortunately for many people all fiscal common sense seems to leave them for anything that has the word "wedding" in front of it (e.g. "wedding photographer", "wedding cake", etc.) The absolute best present you can give yourselves for your future happiness and sanity is to NOT get any further in debt due to the wedding. Does this mean eloping? Wedding in a park followed by a picnic? Don't know, but please, please, please don't get sucked into the proposition that "nothing is too good for the wedding". That being said, if you are going to get wedding presents anyway, asking for cash to pay down debts instead of a new set of china would be excellent!

Great advice

I don't want to sound like an @55 but if you were my kids I would say this :

You're both 30 ? 30? Ok. it's time to adult. That means you do what ever it takes - what ever it takes - to clean up your debt mess.

That means really putting on the big girl pants and working a job you might dislike, delivering pizzas on the weekend, trimming the fat financially, dumping the money pit house. Etc

No whining about "I don't like this or that job". A few years of hard work even if you don't like it won't kill you and will make ALL the difference.

I honestly don't think you are to the point of being scared enough to really clean this up. Your maturity is in question just getting into this mess.
You are still making excuses as to why you didn't do this or that. Face the problem head on.

Also Debt can ruin most marriages - even those that haven't started yet.

Soon you'll be dreaming of homes and babies and this big ugly debt will be hanging over you both. Hubby will be debt free by 2020 and then saddled to YOUR monster debt. That can create tension. Kill the debt now or you'll be paying for it for a lifetime.

You make good income. Why no real progress for the last 4-5 years?
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Old 06-09-2016, 08:16 AM   #27
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A lot of good info here but I don't think it's as bad as everybody says.

Work VERY hard the next 25 years, max out every earning opportunity while you can, live as cheaply as you reasonably can for as long as you can, pay down debt, and things will probably be fine. Can you retire at 55? Who knows. That's a long way away. By then you both may have taken new jobs. Plus, I am not as into this debt forgiveness thing as others. If there is a better paying job, with better career prospects, that wouldn't forgive the debt then maybe that should be taken. Don't let the student loan tail wag the dog. A career choice should be one that maximizes total net income while being as bearable as possible.

Oh ya, and if you have kids... oh gosh, I'll save that for another day.

Good luck!
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Old 06-09-2016, 08:53 AM   #28
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Thanks everyone for the advice! I called and started getting my student loans refi-ed out of IBR so that should be good to go by July and we should see month to month decreasing balances.

@papadad - We are relatively new graduates so we have had this income for about a year.

@calikid - Thanks! I am hoping that by being in a job I am better at / more talented will lead to further income opportunities (the last few months have made it look like that, so fingers crossed). The forgiveness program does require 10 years of service before loan forgiveness (fiance was lucky to have some of his training years count).

Thanks!


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Old 06-09-2016, 10:05 AM   #29
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You really need to have a monthly budget to see where your money is going and help you figure out how to pay down the debt.

From your post, I see something like this (I am treating all funds as community property here since you didn't break out the income into individual):

Income:
$22,705

Fixed Expenses:
Income Tax: $7500 (Fed + State) *
Rent: $2650 (including 2nd apt)
Mortgage: $2250
Car Pmts: $ 500
Insurance: $ 500
Stdnt Loans:$2100
-------------------
Total: $15,500

That leaves you $7205/mo to pay for gas, food, clothing, utilities, extras.

Let's guess for some of these #s:
Gas: $500
Phones: $250
Electric: $150
Food: $1500
Car Maint:
Health Insurance and other benefits:
Etc ... let's say the total comes to $3000/mo and you can definitely cut that number by eating out less, making your own lunches ... looking into cheaper phone plans, getting rid of cable tv ... there are many ideas on this forum if you look for them.

So you should have at least $4000/mo to pay down additional debt and save for retirement. You need to look at all your expenses for a couple of months and figure out the real number.

I would tackle things in this order:
- pay enough on the student loan every month to prevent the debt from increasing
- put the rest towards the credit cards
- when the credit cards are paid off, put that amount towards fully funding both 401Ks (that'll help reduce the taxes and give you a few more dollars to use on the student loan)
- divide everything left in half and put half towards the principle on the student loan, half towards saving for your next car (which will be a used car that you pay cash for) or other emergencies
- if you can sell the house, put any proceeds towards the principle on the student loan

* You really need to do a trial tax return for 2015 ASAP to know how much you're going to owe as a married couple and make sure you're having enough withheld now, or else you are likely to get a nasty surprise next April.
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Old 06-09-2016, 10:26 AM   #30
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cathy63, you took a lot of this with that post and it's solid advice.

I not certain how much of that 4K is going to fund the retirement accounts.

They appear to have only 4k in liquid assets, which is a red flag to me, where is the money going. You were very generous with the food budget for 2 people 750 should be plenty. It appears they stepped into the 2 young professionals lifestyle without considering how to clear some debt off their balance sheet.

They have so little equity in that home 30K they would barely clear the closing costs if they sell at list price.

And just out of curiosity, I wonder what they have planned for a honeymoon? You can always find stuff to spend money on, that will never change. You can only change your attitude about debt and savings. No change in attitude, no debt reduction beyond the minimum..


Hamster ..meet wheel. there is no consumer item on earth worth that kind of hassle for me. And let's be blunt college is consumption, I bet that in the back of their mind they expected to make some payments for 10 years and then the debt would go away. If they knew from the get go they'd have to pay it back...the total would probably be lower.
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Old 06-09-2016, 10:51 AM   #31
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I will only offer how my DW and I addressed her $100k student loan debt. And we live and work in metro-Boston.


Four years ago we set up a monthly budget/tracking for all our expenses on a simple excel type table on a cloud server (Google Cloud) so wherever we were we could track expenses (DW travels a lot for work).


We made a choice to live on one salary - mine - and hers went directly to paying off her student loans. Our goal was to pay off the SL's in three 1/2 years. She managed to pay them off in 3. During this whole time we were both financing our retirement accounts although not maxed out.


We sacrificed a lot over the three years, not going out with friends every weekend, etc. But to have the burden off our backs has been tremendous.


Now that we've figured out how to live on the one income, we continue to do so and have maxed out our retirement funding and replaced both new-to-us vehicles.


It takes sacrifice and commitment, but when it's all said and done you'll be thankful.


We had a Student-Loan-Final-Statement-Burning-Party when the final "all paid" statement arrived (my parent's generation used to have mortgage burning parties).
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Old 06-09-2016, 12:43 PM   #32
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@argus - thanks for sharing and the great ideas. Congratulations to you and your wife-that's a huge accomplishment!!

Best,

Ashley


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Old 06-09-2016, 12:50 PM   #33
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@cathy63 - Thanks so much for the detailed breakdown! It is nice to have a sample roadmap. We use the software You Need A Budget and that has been helpful. Over the past two months, after automatic 401k deductions, et cetera, we do seem to have about 3k left to pay down debt. If we pay off the credit cards and then the cars, that will definitely be a nice chunk of money to throw at the student loans. We still need to talk to a realtor about selling our other home. We are anticipating to be back in that area in about 2 years, but I realize plans can change so it is probably too much of a gamble to keep it.

We also do have savings accounts that I did not mention so there is slightly more liquidity, but not much. We have about 10k in a regular savings account.

Thanks again for your thoughtful feedback.

Ashley


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Old 06-09-2016, 01:02 PM   #34
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@ivinsfan - I'm not sure if you actually wanted a response, but we are not going on a honeymoon. Thanks!

Best,

Ashley


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Old 06-09-2016, 01:02 PM   #35
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With a gross income of around 23K a month you need to find more then an extra 3K for debt reduction. Look harder, cut deeper...take the 10K in the savings and pay off your CC debt.Your student load re-fi will raise your monthly payments.. look hard to find the payment money by reducing your personal spending. You cant cut expenses, if you want to I'm certain of it.
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Old 06-09-2016, 01:12 PM   #36
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Thanks @ivinsfan! You are definitely right - I'm sure we can find more. Onward!


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Old 06-09-2016, 01:42 PM   #37
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Thanks @ivinsfan! You are definitely right - I'm sure we can find more. Onward!


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Good Luck, all of us are giving you advice we wish had gotten at a young age or advice we would give our own kids. The fact that you are asking for and taking some of our "tougher" comments (including mine) in stride....is a sign of your open-mindedness--go for it on and let us know what happens.
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Old 06-10-2016, 04:26 PM   #38
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Live on one income and throw the other into the student loan.


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Old 06-10-2016, 05:51 PM   #39
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I don't get why you won't consider a co-signer, I'm thinking if your finance was the co-signer that would be perfect, as he will share the debt anyhow once you are married.
That lower interest cost will save tens of thousands of dollars.
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Old 06-12-2016, 08:09 PM   #40
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I don't get why you won't consider a co-signer, I'm thinking if your finance was the co-signer that would be perfect, as he will share the debt anyhow once you are married.
That lower interest cost will save tens of thousands of dollars.
That is my question as well. Can't your soon to be DH become a co-signer? I'll by tied by knot and debt anyway, why not get a small discount?
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