Is anyone talking out parent plus loans for kids who want to go into government work?

[Anonymous]

I've been researching the idea that maybe we should be borrowing our full pay tuition for a kid is aiming to work for the federal government and lean into the Public Service Loan Forgiveness (PSLF) program. Which works even for parent plus loans.

I mean, there are programs like the Student Loan Repayment Assistance Program (SLRAP) to help make loan payments for 6 years, the loans are income driven for the next 4, and then at 10 years they're forgiven (no cap on amount). If a full pay family doesn't spend 350k on college, instead keeps it on powder for 10 years, that's easily 700k.

I understand it locks kid into a job for 10 years, but .. you could get out of it (there is the money sitting there, even if program disappears) and if the kid wants to work for the federal government, or state government, or teach, or work in intelligence etc etc etc .. why not keep this option open. The swing in money could be enormously life changing.

[Anonymous]

interesting- my kid is interested in govt work and i hadn’t thought of this. Do they forgive grad school loans as well?

[Anonymous]

For me the PSLF pays up to $10k per year for max total of $60k lifetime.

[Anonymous]

SLRAP covers 10k of payments per year for 6 years. PSLF covers the balance. Per my understanding.

"Public Service Loan Forgiveness cap
Crucially, there is no income limit for PSLF eligibility and no cap on how much can be forgiven. Whatever remains after a borrower reaches 120 months of qualifying payments is fully forgiven, tax-free."

[Anonymous]

You would have to balance it against what they could earn in a private sector job -- which could be more, in the long run. Living here in the DC area is expensive on a government salary; earning more in the private sector, with the ability live in a lower cost area might be a better benefit.

[Anonymous]

Anonymous wrote:You would have to balance it against what they could earn in a private sector job -- which could be more, in the long run. Living here in the DC area is expensive on a government salary; earning more in the private sector, with the ability live in a lower cost area might be a better benefit.

Sure, I'm only looking at this because the student is actively looking at government work and since pay will be moderate, having access to a windfall in early 30s to buy a home, etc make this career route a lot more attractive. (I have an older kid who went into math > banking and this is not a thing we considered)

[Anonymous]

Interesting thought.

I am a state employee (Virginia) and plan on being one until I retire in 15 years.

Would there be a possibility/benefit to paying for child’s degree through Parent Plus loans, since the balance will get forgiven after 10 years through the public employee forgiveness program?

[Anonymous]

Yeah, that's what I'm asking. I've never been a government employee - or had student loans - so I'm starting from scratch on this. Just reading, reading, reading. Wondering if I'm the only one.

I think the idea of having income-driven student loans from, say, 22-32 isn't terrible if the loans are wiped out after that.

[Anonymous]

Parent plus loans belong to the parent, not the student; so the parent would need to work in public service to have these forgiven (not the student).

[Anonymous]

No, I would never take loans or advise my kid to take loans they didn’t plan on paying back entirely on their own. You have no idea where they will end up. Don’t borrow money you can’t repay. I say this as someone who works in a job where loans would be forgiven. This job was not my original plan when I started college.

[Anonymous]

Anonymous wrote:No, I would never take loans or advise my kid to take loans they didn’t plan on paying back entirely on their own. You have no idea where they will end up. Don’t borrow money you can’t repay. I say this as someone who works in a job where loans would be forgiven. This job was not my original plan when I started college.

But she said she can repay. She has the money and could repay. That was in her post.

[Anonymous]

Anonymous wrote:Parent plus loans belong to the parent, not the student; so the parent would need to work in public service to have these forgiven (not the student).

+1 OP, I work for the government and also looked into this. My understanding is that the parent must work for the federal/state government.

Also, if you get a loan for $300k, after payments for 10 years, you will pay back approximately $220k and the remaining principal and interest balance will be forgiven. That means you saved about 1 year of tuition if you had paid cash.

[Anonymous]

I’d question the committment to government work when the kid is only 18. Things may change over their college career or they might spend a few years in government and then realize they’d rather do private, consulting etc. My husband worked in fed for a long time but he saw a lot of people come and go during that time.

[Anonymous]

Anonymous wrote:For me the PSLF pays up to $10k per year for max total of $60k lifetime.

My bad, not PSLF. It is NIH's SLRP.
https://policymanual.nih.gov/2300-537-1/

[Anonymous]

I don't think the math works out. This is all in flux right now too, so do the actual calculations when the new info is released because the ICR plan it was under is being changed.