We Have $300,000 in Student Loan Debt! (What Should We Do?)

January 25, 2023


Ron has a question, he says his wife has $300,000 in student loans at seven percent for a doctorate program, but these will be forgiven in six years with her current employer. Ron is wondering if they should treat it as high-interest debt and pay more than the minimum or slow down in investing.

So, Ron, I’ll give you the disclaimer first. It’s really difficult to give specific, unique financial advice to you because we don’t know all the other circumstances and we don’t know what’s going on in your life situation. But we can speak to some things to think about.

Now, Ron, I’m going to recap this to make sure I’ve got the facts correct. His wife has $300,000 of student loans at seven percent with her current employer and she’s on pace for them to be forgiven in six years. Yes, all right, so the debt will be forgiven and so the question is, should he pay on it aggressively or pay the minimum in order to have the most amount forgiven?

All right, so I’m going to take a leap here and assume medical school took a while to get through and accumulate that much. We’re going to say they’re probably in their mid-30s, somewhere in that ball, early to mid-30s.

So, for someone in the early to mid-30s, Brian, approaching this kind of thing, right, $300,000 in debt, there’s this thing that could happen. What are your thoughts? And I’ve got some thoughts, but what are your thoughts on how you would approach that?

Um, here’s what I think you would say, and I kind of agree with this, is that you’ve got a unique take. Look, $300,000 of student loan debt, it’s a holy cow, it’s a lot. That is can you imagine trying to eat that elephant? I mean that just seems overwhelming. Now, you, first of all, hopefully, because you’ve heard our guidance, now it’s always different for professionals because you said it’s a doctorate program. I don’t like people to have more student loan debt than what they can make the first year of the job. So, that just $300,000 is such a big number. But here’s what I want you to think about, you gave the information that in six years this could be forgiven by the employer. I really hope they like their employer, yeah, and I really hope they like that job because that is a tremendous benefit. I mean, if you just take $300,000 and divide it by six, I mean, you can see that that is a substantial sum of compensation that would really make me lean hard on taking that into account when figuring out, do I go take another job because that is, that’s worth a lot of money.

So, that’s part of your handicap process of figuring out the decision making, what is that worth and how realistic it is for your spouse to stay at that job for six years. The next thing you can do to protect yourself is to turn this into a math exercise. Whatever you were going to pay on that, you know, within reason, I want you to be able to track what money got put elsewhere. So that you have an alternate opportunity that if you don’t get the forgiveness in six years. You’ve got to be very disciplined and careful in not letting your lifestyle to expand and spend these dollars elsewhere.

Most Recent Episodes

Financial Hacks and Habits of the Top 1% (By Age)

ho wouldn’t want to have a high enough income and net worth to be considered part of the top 1%? In this episode, we’ll tell you exactly how much you need to be considered part of the top 1% - and the habits and hacks those in the top 1% used to get there.   In this...

How to Win With Money in 2023!

Financial resolutions are always near the top of the list of Americans’ most popular New Year’s resolutions. Whether you want to save and invest more, pay off debt, or have other financial goals, we will give you the tools you need to win with money in 2023.   In this...

TikToks That INFURIATE Financial Advisors

The most powerful time to get serious about building wealth is when you’re young. So, what is the younger generation learning? Financial Advice (good and bad) is being produced in massive rates across online platforms and TikTok is the new frontier. Is there good...

5 Levels of Wealth AND How to Achieve Them! (2023 Edition)

We believe there are five distinct levels of wealth, but they aren’t solely dependent on income or net worth. We’ll walk you through each of the five levels - including how to know where you are at, how to advance to the next level, and signs you are doing it right.  ...

Average Net Worth By Age in 2023!

It’s time for one of our most anticipated shows of the year: our annual Net Worth By Age show! In this year’s edition, we’ll shared updated numbers and data for 2023 and discuss the most important things for you to focus on in each decade.   In this episode, you'll...

Win Financially During a Recession! (Everything You Need to Know)

The bear market we've experienced in 2022 has been longer than many in recent memory - and some are concerned that the economy may soon enter into a recession. Here's everything you need to know to stay on-track and win financially during a recession!   In this...

The Fed Just BROKE the Car Market! (What You Need to Know)

Car prices have been on a rollercoaster ride the last few years, and it looks like they might finally be coming down. In this episode, we’ll discuss what you need to know about the current car market, pitfalls of buying a car, and how to do it the right way.   In this...

Top 4 Money Mistakes People Make During the Holidays!

There’s a reason why financial resolutions are always near the top of the list in January - many Americans spend the holiday season making financial mistakes. In this episode, we’ll discuss the top money mistakes people make during the holidays and how to avoid them....

Financial Advisors Share What They WISH They Knew About Money Earlier!

Have you ever felt like if you just knew this one thing about money earlier your finances would be in a better spot? In this episode, we’ll share the five biggest things we wish we knew about money earlier!   In this episode, you'll learn: What we wish we knew earlier...