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Should I get student loan?

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    #16
    Originally posted by Eagle View Post
    Sounds like a solid plan Leo. How long would it take you to pay off the student loans (SL) with a 6 digit salary in your field?
    Originally posted by Eagle View Post
    Artwest, as someone who got an MBA and more than doubled his income largely due to further education I disagree with your recommendation to not take out SL's. As to the not going into debt, income being the greatest wealth building tool, paying cash, and use income to invest... All that sounds like Dave Ramsey's advice.

    Sure people should try to pay cash if at all possible. I agree with you there.

    Leo, if it means taking out SL's and you can pay it back within a few years go for the masters. Try to get as much education out of the way as possible before you have kids. If you guys plan on having kids that is.
    If I have a 6 digit salary and about $12,500 in Student Loan. I can probably pay it off within couple years.

    -----

    My enrollment is next month. I think I'm gonna try to pay the $2500 (1st semester) in cash and see how it goes, if I think it's really tough for the next semesters, worst case is I will get a federal student loan. Best case is my dear wife gets a job, help me pay the bills, and I can pay tuition fee in cash while knocking off credit card debts.

    Thank you guys for the advice. I am a long time reader here btw.

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      #17
      If you're making 57K pretax now and anticipate making 100K+ after graduating the program then it shouldn't take you a few years to pay off a $12,500 debt, don't be one of those people who has to spend a whole bunch more just because they start making a little more. I would advise you to take out the student loans because planning to pay off your credit card before the 0% runs out and actually doing it are two seperate things (the best laid plans of mice and men and whatnot). What is the APR on the card after the 0% runs out? 10, 15, 20% or more? The rate on an unsubsidized federal loan is 6.8%, subsidized is around 4%, averaged out your rate on SL debt would probably be at least half of what it would be on a CC. If you were talking about going 30k or 40k in debt for a degree with not many prospects then there would be a lot of things to weigh before deciding, but this seems like a no brainer to me. Its only 12K, with your budget as it stands now even if you don't make any more after graduating you could still pay that off in a year with your $1050 a month leftover after expenses (although I know that's not realistic or practical, I'm just saying). I see this situation as a choice between credit card debt and student loan debt, so the only reason I can think of to keep the debt as a credit card would be if you plan to file bankruptcy soon, since you can't get rid of student loan debt that way. It's fairly obvious that this is not your plan so pay of the CC and apply for SL. The credit card companies offer those 0% rates for a reason, because everyone intends to pay it off before the actual rate kicks in. This has worked out much better for the credit card companies than for the customers.

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