Post: #1

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Who here has successfully paid off his student loan debt?

How did you do it?

Did you do it in an unorthodox way besides "got a yuppie white collar job and paid it off over 20 years"?

I believe that Scotian, or people Scotian knows, paid off their student loan debts in 1-3 years in their entirety by working in the Oil Sands.

I know people who have paid off more moderate amounts in the range of 10-20K by teaching English in Thailand/Korea and living frugally.

Some friends of mine paid their debts off while working on Wall Street. That option is definitely not open to everyone.

Has anyone found an unorthodox, clever, or just highly effective way of paying off 10-50K of student loan debt within 1-5 years of graduating university?

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Post: #2

Try not to get them in the first place.

While I may not have followed the typical career plan of graduating university at 22 with $80,000 debt, I did graduate with some debt.

- I applied for scholarships like it was a full time job. Granted it was, my first year of university *was actually second year for most others, I will explain that later) I spent 17hours filling out forms and putting files together. Every scholarship deadline was entered into my google calender with reminders a week before due date. When that time of year came up for second year it was a lot smoother, less work and I managed to get $25,000 in scholarship, including one that paid my tuition and an $850 monthly stripend. In total I ended up with $55,000 in scholarships over my three years.

- I had a mechanical trade (metal fabrication) that I used in the summers. $35 an hour can put some decent coin in the pocket especially if there is no tuition to pay (covered by scholarship in year 2 and 3). Two of the wrench monkeys I was in charge of were also students, no skilled trade per se, but were willing to bust their ass to earn that $17 an hour. Men should work construction and trade jobs in the summer. Period.

*I had a trade and business experience before I entered university. The school had what is called a PLA (Prior Learning Assessment) where again, you fill out a bunch of paperwork (notice a trend here?) and then get interviewed by the Dean of the school and Head of Admissions. I fought hard and had most of the first year classes PLA'd so I just overloaded the second year schedule as well as took a condensed summer class that was over in 6 weeks so did not really damage my summer money making time frame.

This is not really out of the box thinking, but the fact that I only knew of maybe one other person doing something similar it makes it rare enough to be out of the box. Students prefer to cry and protest rising student loan debt but no one ever followed up with me on my scholarship leads or summer jobs. Yet there they were working at the school putting up displays and protests for "stop the student loan bubble".

The sense of entitlement that is so pervasive right now might not have began in university, but it is certainly groomed there.

Post: #3

I incurred about $90,000 total student loan debt when I went to law school. About $60,000 of the debt was for federal loans and the remaining amount was for private loans. When I first graduated, I was paying about $1,000 per month toward my loans. I kept making those payments for about a year. After the first year, I had my payments reduced to about $500.00 per month. I eventually completely stopped making payments, which caused me to receive calls and letters constantly. At the time I stopped making the payments, I owed about $69,000. With interest and late fees, the total amount owed increased to about $73,000. Around May 2010, I entered into a deal with respect to the federal loans. I paid about $35,000 in order to completely erase my federal student loan debt. About $8,000 of that debt was forgiven, although I received a 1099 for that debt and it was counted as income on my tax returns. Last October, I paid approximately $25,000 to take care of the private loans. For those who use credit (I don't), such a settlement could have a negative effect on credit.

Post: #4

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Laner where are you from originally? Sounds like the US but just want to confirm.

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Merenguero - ouch law students are really getting deep into debt. I'm glad you are heading in the right direction. I know people 100K+ in debt and can't find entry level jobs in anything right now.

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Post: #5

(06-14-2013 01:30 PM)youngmobileglobal Wrote:  Merenguero - ouch law students are really getting deep into debt. I'm glad you are heading in the right direction. I know people 100K+ in debt and can't find entry level jobs in anything right now.

It's much worse nowadays. I graduated over ten years ago and was still hit with almost a six-figure debt.

Post: #6

Quote:Laner where are you from originally? Sounds like the US but just want to confirm.

This was in Canada.

Post: #7

Yeah, I would avoid getting into them in the first place. I went to a cheap school and got in state tuition (tuition was 3k/year at the time), rented an apartment with friends to pay 400/mo and even with books and other things, my expenses were <15k a year all told. Definitely doable with a job or an internship.
I checked the current tuition for the school, and now it's 12k. Okay, so <25k a year, which I think is still doable with a part time job + summer internship, or if you take small personal loans from family.

If I were stuck with student debt, then I guess it would depend on the interest rate. If it's <4% then I wouldn't worry and would just shut up and pay. If it's more then I would try to consolidate it into a loan that is dischargable in bankruptcy, like a personal bank loan or third party loan like lending tree, if I had a good credit rating. If not, then I would find an employer who is willing to pay off the student loan debt as a perk for 2+ years of service. Some employers will do that.

Some federal government jobs also will pay off up to 10k of your student loans a year per year of service after the first or second year: http://www.opm.gov/policy-data-oversight...repayment/

Post: #8

Ok here is a hack.

One of my best friends pulled this off. It takes a bit of balls, but worked like a charm.

He is a grader operator in Alberta every summer. In four months working 12-16 hour days can pocket $40,000 after all expenses for a summers work. Good living while a student for sure.

But he would file for Canadian GOVT student loans. The maximum every year. He would lie and say he made $0 over the summer. His students loans he put into GIC's or CD's or some stocks as the interest on loans does not start until 6 months after graduation. He also hid all of his TSFA's and RRSP's.

When he graduated he applied for deferred payments every 6 months and at the same time applied for debt relief. The Alberta government is great at knocking off student loan debt, and they cut his in half, some $30,000. So in the end, he was up that amount, the interest from the loans (him and I also did good on Tesla stocks) and still made lots of bank from the summers running grader.

He lived it up as a student. This is how a mature student should roll. Godfather style.

Post: #9

Here's some info from the collections side of the student loan issue:

I know a lawyer who immediately stopped paying his student loans after passing the bar. When they called he would tell them straight up that he was never going to pay them and they were wasting their time. Eventually they quit trying and he is very successful today.

However, and this needs to be put in capital letters, THESE WERE NOT FEDERAL LOANS!!! They were private loans with state dependent statute of limitations. You have to read the contracts thoroughly. The IRS is usually involved and they are 1000 times worse than a private collection agency because they will never go away and they have serious powers where a collection agency has none.

The statute of limitations on federal student loans is usually many times longer than the state statute of limitations. For example, your state may have a 3 year statute of limitations on debt, meaning the creditor has three years to take you to court and get a judgement. A federal student loan may have a 10, 12 even 20 year statute of limitations administered by the IRS. This a smart move because they give themselves plenty of time to let you go from a broke ass student to a successful earner.

The penalties are high but the bright spot is they are very forgiving when you tell them you don't make any money and can only pay $25 per month. Instead of avoiding the collection calls just be "honest" and tell them about your "hardship situation" and they will sign you up for extremely low minimum monthly payments. It's like having a $100,000 mortgage and paying $20 per month on it (obviously you have no hard asset beside the degree). When you can eventually afford to cut a deal they'll cut a shitload off the balance, you pay the settlement amount (and get 1099'd as Merenguero pointed out) and it's all over.

The worst thing you can do is not deal with it head on ASAP. It doesn't matter how much you owe, they will bend over backwards to lower your payments.

Post: #10

(06-14-2013 12:52 PM)Laner Wrote:  This is not really out of the box thinking, but the fact that I only knew of maybe one other person doing something similar it makes it rare enough to be out of the box. Students prefer to cry and protest rising student loan debt but no one ever followed up with me on my scholarship leads or summer jobs. Yet there they were working at the school putting up displays and protests for "stop the student loan bubble".

The sense of entitlement that is so pervasive right now might not have began in university, but it is certainly groomed there.

Great contrast. That's the difference isnt it... finding solutions vs complaining about the (first-world) problem.

Post: #11

(06-15-2013 07:59 AM)painter Wrote:  Here's some info from the collections side of the student loan issue:

I know a lawyer who immediately stopped paying his student loans after passing the bar. When they called he would tell them straight up that he was never going to pay them and they were wasting their time. Eventually they quit trying and he is very successful today.

However, and this needs to be put in capital letters, THESE WERE NOT FEDERAL LOANS!!! They were private loans with state dependent statute of limitations. You have to read the contracts thoroughly. The IRS is usually involved and they are 1000 times worse than a private collection agency because they will never go away and they have serious powers where a collection agency has none.

The statute of limitations on federal student loans is usually many times longer than the state statute of limitations. For example, your state may have a 3 year statute of limitations on debt, meaning the creditor has three years to take you to court and get a judgement. A federal student loan may have a 10, 12 even 20 year statute of limitations administered by the IRS. This a smart move because they give themselves plenty of time to let you go from a broke ass student to a successful earner.

The penalties are high but the bright spot is they are very forgiving when you tell them you don't make any money and can only pay $25 per month. Instead of avoiding the collection calls just be "honest" and tell them about your "hardship situation" and they will sign you up for extremely low minimum monthly payments. It's like having a $100,000 mortgage and paying $20 per month on it (obviously you have no hard asset beside the degree). When you can eventually afford to cut a deal they'll cut a shitload off the balance, you pay the settlement amount (and get 1099'd as Merenguero pointed out) and it's all over.

The worst thing you can do is not deal with it head on ASAP. It doesn't matter how much you owe, they will bend over backwards to lower your payments.

There's an easier way to deal with federal student loans. IBR and PAYE limit your loan payments to a percentage of your annual available income. AAI is based on AGI. AGI is manipulable and doesn't include capital gains. Translation: buy capital assets that produce writeoffs.

Post: #12

The Rustler is debating on how to proceed with my student debt:

Currently making about 2.5K post-tax (plus $300-500 bonus) a month.
2013 reported income: 6K (I was jobless from January-October)

Debt: Around 20K-25K, I don't want to look at the number....I just want to pay that shit. Around 17-20K in federal loans and 3-5K in state loans.

Current expenses: ~$390
$60/month cell phone bill, $100/month internet/cable, 150/month for gas, $80 for insurance.

Route 1 - Take a some classes, and then pay it off.
Route 2 - Pay it off immediately, make $800-$1000 a month payments.
Route 3 - Make minimum payments for the rest of my life.

I think Route 2 would be the most beneficial as I have to eventually pay it off, become student loan free and not have to worry about wage garnishments and shit. Route 1 seems nice but I work 10-12 hour days and the bill will keep growing.

Any input from the RVF crew is much welcomed.

Post: #13

(01-20-2014 12:05 AM)Cattle Rustler Wrote:  The Rustler is debating on how to proceed with my student debt:

Currently making about 2.5K post-tax (plus $300-500 bonus) a month.
2013 reported income: 6K (I was jobless from January-October)

Debt: Around 20K-25K, I don't want to look at the number....I just want to pay that shit. Around 17-20K in federal loans and 3-5K in state loans.

Current expenses: ~$390
$60/month cell phone bill, $100/month internet/cable, 150/month for gas, $80 for insurance.

Route 1 - Take a some classes, and then pay it off.
Route 2 - Pay it off immediately, make $800-$1000 a month payments.
Route 3 - Make minimum payments for the rest of my life.

I think Route 2 would be the most beneficial as I have to eventually pay it off, become student loan free and not have to worry about wage garnishments and shit. Route 1 seems nice but I work 10-12 hour days and the bill will keep growing.

Any input from the RVF crew is much welcomed.

I can't imagine that minimum payments would be a good idea, unless the interest rate is in the basement (which I highly doubt) or you get special considerations.

Post: #14

I think you should make the minimum payments while saving up the rest in a separate bank account until you get the amount to pay them off completely. You'll pay a little bit more in interest by doing this, but if you hit a rough patch financially you can cover yourself.

I went through this two years ago. I was putting away 1500-2k a month for my (federal) student loans. I owed 65k at the start. Then the company I was working for went under and laid everybody off. I had almost no savings to float me while I worked to get the next job with comparable pay. It took me about a year to find similar employment, and now I owe about 70k. I've since switched to the IBR. I'll pay that back on my own terms, probably lump sum at some point.

Post: #15

I don't know situation in the US (I reckon your student loans are on average much higher), but I can tell you guys how I did it.

I had 13k euros to pay. First thing I did was tell myself: how do I get rid of this in one year with the least bit of drama.

That left me convinced that monthly payments were a fool's game that will be a nuisance for some time to come.

So, I invested in a few things, one of them was bitcoin. Then I paid off my loan.

Post: #16

(01-20-2014 12:05 AM)Cattle Rustler Wrote:  The Rustler is debating on how to proceed with my student debt:

Currently making about 2.5K post-tax (plus $300-500 bonus) a month.
2013 reported income: 6K (I was jobless from January-October)

Debt: Around 20K-25K, I don't want to look at the number....I just want to pay that shit. Around 17-20K in federal loans and 3-5K in state loans.

Current expenses: ~$390
$60/month cell phone bill, $100/month internet/cable, 150/month for gas, $80 for insurance.

Route 1 - Take a some classes, and then pay it off.
Route 2 - Pay it off immediately, make $800-$1000 a month payments.
Route 3 - Make minimum payments for the rest of my life.

I think Route 2 would be the most beneficial as I have to eventually pay it off, become student loan free and not have to worry about wage garnishments and shit. Route 1 seems nice but I work 10-12 hour days and the bill will keep growing.

Any input from the RVF crew is much welcomed.

route 2 definitely- assuming you have good job stability. Otherwise as someone else mentioned, you might hit another rough patch and be jobless and not have any nest egg

Post: #17

I see some good ideas on here, very good. Anither thing you could do with Federal Loans is an IBR, income based repayment if needs be. Speaking of which I need to get another deferment or something this month.

Post: #18

(06-14-2013 11:06 AM)youngmobileglobal Wrote:  --

Who here has successfully paid off his student loan debt?

How did you do it?

Did you do it in an unorthodox way besides "got a yuppie white collar job and paid it off over 20 years"?

I believe that Scotian, or people Scotian knows, paid off their student loan debts in 1-3 years in their entirety by working in the Oil Sands.

I know people who have paid off more moderate amounts in the range of 10-20K by teaching English in Thailand/Korea and living frugally.

Some friends of mine paid their debts off while working on Wall Street. That option is definitely not open to everyone.

Has anyone found an unorthodox, clever, or just highly effective way of paying off 10-50K of student loan debt within 1-5 years of graduating university?

--

why bother? i consolidated mine into 20 yr debt at 2%. makes no sense to pay them off now really.

Post: #19

(01-20-2014 12:05 AM)Cattle Rustler Wrote:  The Rustler is debating on how to proceed with my student debt:

Currently making about 2.5K post-tax (plus $300-500 bonus) a month.
2013 reported income: 6K (I was jobless from January-October)

Debt: Around 20K-25K, I don't want to look at the number....I just want to pay that shit. Around 17-20K in federal loans and 3-5K in state loans.

Current expenses: ~$390
$60/month cell phone bill, $100/month internet/cable, 150/month for gas, $80 for insurance.

Route 1 - Take a some classes, and then pay it off.
Route 2 - Pay it off immediately, make $800-$1000 a month payments.
Route 3 - Make minimum payments for the rest of my life.

I think Route 2 would be the most beneficial as I have to eventually pay it off, become student loan free and not have to worry about wage garnishments and shit. Route 1 seems nice but I work 10-12 hour days and the bill will keep growing.

Any input from the RVF crew is much welcomed.

#2 would be my course of action. Having debt sitting on your shoulders is a terrible feeling, being free from it will really help. Sooner, the better.

Post: #20

The American student loan system slightly horrifies me as a European. I couldn't imagine leaving college with, effectively, a mortgage-load of debt (100k? 200k?!) in my early 20s. Nobody I know had over 10k of debt after university, and 10k was only for those foolish enough to get loans to spend on booze.

Could any of you explain why Americans simply don't leave the U.S. and never pay back the loan? If I owed 200k in a country I'd be out of there in a flash. That's the kind of debt that ruins your disposable income levels for 20 years. Move to Europe, movie to Dubai, move to Asia, move to Australia...anywhere you can get a visa for and have job prospects.

Post: #21

(01-21-2014 06:25 PM)zatara Wrote:  The American student loan system slightly horrifies me as a European. I couldn't imagine leaving college with, effectively, a mortgage-load of debt (100k? 200k?!) in my early 20s. Nobody I know had over 10k of debt after university, and 10k was only for those foolish enough to get loans to spend on booze.

Could any of you explain why Americans simply don't leave the U.S. and never pay back the loan? If I owed 200k in a country I'd be out of there in a flash. That's the kind of debt that ruins your disposable income levels for 20 years. Move to Europe, movie to Dubai, move to Asia, move to Australia...anywhere you can get a visa for and have job prospects.

Americans don't know where any of those places are. In all seriousness, I think you're absolutely right and more people will run away from their student loans in the future. I read an article recently about a 60-something American professor in the Philippines with a $1 million in student loan debt. Basically, he's a debt refugee. That's obviously an exceptional situation but there are many people with $150-200K. Very easy to do if you went to a private school. A lot of those guys end up working at Starbucks.

If one did find them-self in this position, instead of worrying about paying back your student loans, build a skill-set in global demand and get out of dodge. You could build your net worth from day one in Dubai or write checks to the Department of Education till your 72. Its a no-brainer...

Post: #22

What are the terms on your loan (interest rate and length of loan)?

Also, $150/month in gas? Do you drive a lot?

Post: #23

If living overseas the European and American governments can't reach you right? Debt-free immediately

Post: #24

College debt is scary as fuck

Post: #25

Seriously though - why not just consolidate at a low interest rate? Are they not doing that anymore?

mine is at 2%