Monstrous student loan debt...and my plan to pay it all back

[blissfulmarmot]

Alright guys, first off i'm very glad I found this forum. I've been over at some nursing forums but wanted to get a wider audience and folks who've dealt with more debt related issues (six-figure debt, to be exact) that could give me more relatable feedback.

So, short story long, I graduated with a Bio degree and eventually went into nursing. My GPA was very "meh", but finally I was accepted at a good accelerated BSN school, though the tuition was steep. Anyway, I was able to accumulate $115k at both schools and am now working F/T as a nurse making around 64-65k a year. I'm a single guy, 29 y/o with no s/o or children, so that makes it easier.

My student loan payments altogether are roughly $1,300 a month for the next 10 years. Ouch. However, I live really, really cheap--like ramen noodles, no cable, take the tram to work, car is paid for etc. to cut costs. I'm trying to devote $30k a year to this debt and 2017 will be my first year trying it. If I can do this for 2-3 years, my standard of living will definitely improve--suffice to say. And yes, it's a tall order, so i'll have to actually see if I can do it first.

I'm thinking about taking another path as well...i've always wanted to be an NP in a rural care setting. I know if you're in school, you can hold off on loans (while they accrue some interest). I was thinking about getting my debt down to below say 40k, then doing a 2 year hybrid (online/in class) MSN degree, which would allow me to work nights or PT to pay my rent and gas/food while getting a better degree, then apply for an NP job once i'm out. I have a friend who lives in a more rural part of the state who says their new grad NP's make around 90k. This would help me a lot in consolidating the remainder of my debt, especially if I was still living like I was below the poverty line.

What say you? Is this a good option to consider or should I just grind out 4-5 total years of being dirt poor and pay it all off? Anyone else in this scenario? Does my debt scenario make you feel much better about yours? Haha...

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[dpmd]

I think you were crazy to get into such debt for the planned income (especially since there are community college RN programs that would have cost you a tiny fraction of that amount) but that is where you are so you have to move forward from there. How much would you be looking at for the next degree?

 

[blissfulmarmot]

Yes, I was crazy. I spent 2 years trying to get into several CC programs to no avail (my gpa was only 2.7, the waitlists were 2-3 years long). I was depressed and working a dead end hospice job and barely paying rent. I bit on the first offer I got. Luckily I have no one else to share the debt burden with.

The MSN degree would cost around $15k with books and fees included--but i'd probably pay it all in cash semester by semester. I'm just thinking it would speed up the process in repaying the debt, and i'd gain entry into the field I want to go into anyway.

 

[dpmd]

Yes, I was crazy. I spent 2 years trying to get into several CC programs to no avail (my gpa was only 2.7, the waitlists were 2-3 years long). I was depressed and working a dead end hospice job and barely paying rent. I bit on the first offer I got. Luckily I have no one else to share the debt burden with.

The MSN degree would cost around $15k with books and fees included--but i'd probably pay it all in cash semester by semester. I'm just thinking it would speed up the process in repaying the debt, and i'd gain entry into the field I want to go into anyway.

That isn't as bad as i was thinking. you could also see if your employer will help with school at all.

 

[keifernny2]

My advice, work overtime. Pick up a second job for a few years. You don't have a family to worry about spending time with yet. Hold off on more school until you're sure that is what you really want. Going to school would be like working a second job anyway, and once you finish as a NP you'll be expected to work more hours for that extra money, so why not start now without the worry of ending up in more debt.


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[jacksparrow82]

What is your interest rate on that debt? If its under 5% you may not need to pay it off as quickly as you think. If its above that, then yes, pay it off quickly. Regardless, the first thing you need to do when you start working is save up an emergency fund. At least 3-6 months of living expenses. That way if you lose your job or unexpected things come up, you have the cash on hand to ride it out a few months while you figure out your next move. This is so so important to do right away. It will prevent you from going into any more debt. Once you have your savings, then you can start attacking the highest interest rate loans first. Go after the smaller amounts first that way you feel some sense of satisfaction when you see one paid off. If you can stand to work a second job or do extra shifts, take all of that extra cash and put it towards loans. If you have low interest rates, I would consider saving more aggressively and let the loans go for some time. At 29 years old, you're already behind a bit on saving, so you'll need to start putting money away for retirement now so you can take advantage of the beauty of compounding interest. The worst thing you could do is not save anything for 5 years and sure you'll be debt free, but you'll have zero wealth and will be super behind on saving.
Here's what I would do:
1. Emergency fund, 3-6 months living expenses, put it in a interest bearing savings account and don't touch it
2. Set up your paychecks so that you are putting money towards your 401K (at least enough to get the full employer match)
3. Set up your paychecks to also put money aside for personal savings (a vacation, gifts for people, going out occasionally, saving for a downpayment on a house or a ring for a future wife, etc). You have to enjoy life.
4. Anything that's left over minus living expenses should go immediately to attacking higher interest loans with the smallest balances first.
5. If your interest rates are low (2%, 3%, even 4%), consider just paying the minimum payments and put all that extra money into a Roth IRA and max out your 401K.
6. After working for at least a few years, you can decide if going back to school for NP is still something you want to do and you'll be in a better financial position at that point to consider it. There are tax advantages to being in school and working, so that could work in your favor if you do decide to go back.

 

[Student Loan Planner]

Based on the limited info available here, I think the answer is easy. Do PSLF at a not for profit hospital for 10 years and it's gone tax free.

 

[FrugalMuscle]

Your debt to income ratio isn't awful (I mean it's not good, but it's not horrible). I would continue to live as a student and kill those loans. Another option would be to go into a loan forgiveness program and work in a federally underserved area. You'll make good money AND get EXTRA money to pay the loans.