UMC deep in the negative

[Anonymous]

Anonymous wrote:Its very clear that your ROI on those law degrees was awful![i] One or both of you need to move to the private sector and pay off those student loans before they destroy your financial future.

Hopefully this will lead to fewer and fewer attorneys in the next decade or two!

[Anonymous]

Anonymous wrote:

Anonymous wrote:My jaw literally dropped when I read 575,000!!! How on earth???

Two law school bills. Did you know just the tuition for many private law schools is $55k-70k per year, three years? Even a public school like Berkeley charges more than $50k a year. It made the news years ago. Plus if you lived in a big city the housing costs were high. I know someone 8 years out of GW Law still repaying $300k. He qualifies for the public interest whatever program and is currently only paying 1/6 of what he should be without the program. He will stick with the government 10 years until the balance is forgiven.

Tell your friend good luck with that:

https://www.marketwatch.com/story/this-government-loan-forgiveness-program-has-rejected-99-of-borrowers-so-far-2018-09-20

[Anonymous]

After reading all of this, just wanted to share the advice my firm’s free PWM advisor told me re:loans. Paying them off before investing in anything (a house, equities, even my 401k) is not a choice. Because, at the end of the day, paying them off IS an investment, in and of itself. Every cent I pay towards them now, is multiple more cents I won’t pay down the line.

He told me that I cannot truly worry about anything outside of an emergency fund before wiping these out. Sorry if totally off topic, but the reframing (paying off loans = investing) really helped me jumpstart getting serious about getting them down ASAP.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Three of my relatives graduated medical school and worked off their debt in two years, Two cousins and 1 spouse, rented my basement apartment and lived pretty frugally for two years and worked off approx 200K of loans each. In fact, they lived more frugally when they were in medical school. In retrospect the two years went by fast. I think they also were so busy that it would not have mattered if they lived in a more expensive place. They were home mostly to sleep and do chores.

+1. This is what you have to do.

In comparison, we make 450k HHI and we stayed in our 800k house with an old car so we could pay 150k off in loans.

Oh no - an $800k house? Wow - was the neighborhood pretty safe at least? That must have been so hard!

Make fun of me alll you want. ON our salary, OP would have a $1.2 million house and a newish car or two. AND student loans.

Stop being a jerk. Yoi don't have money problems.

Also it is arguable that OP should have some lean years and pay off the loans on schedule and invest once childcare costs go down. Also a house is an investment. They are building equity and not throwing money away on rent. Difference is they wont have a longchamp bag or fancy vacations. They will eventually. I sometimes find it strange that everyone is chompingvat the bit to use all of their income to pay off loans and not invest and then let the interest earned fro. investments pay off the loans for you, especially if you have a low interest rate on said loan.

It’s not an investment if OP is actually building up more in interest by not paying down loans vs. the rate she’s “building equity.” Its simple math. If you want to reframe it, it’s badically like saying, oh I’ll invest in the potential ~7-10% return I’ll get maybe 30 years from now alongside the guaranteed -7% per annum I’m also making!

It’s compounded, so you know, again....math.

[Anonymous]

Anonymous wrote:After reading all of this, just wanted to share the advice my firm’s free PWM advisor told me re:loans. Paying them off before investing in anything (a house, equities, even my 401k) is not a choice. Because, at the end of the day, paying them off IS an investment, in and of itself. Every cent I pay towards them now, is multiple more cents I won’t pay down the line.

He told me that I cannot truly worry about anything outside of an emergency fund before wiping these out. Sorry if totally off topic, but the reframing (paying off loans = investing) really helped me jumpstart getting serious about getting them down ASAP.

OP here, that is a great way to look at loans you are able to pay off but not really applicable to my situation. My large loans were in negative amortization for 2 years before I made a decent salary making my loans more a loss I need to shield from liability. So instead I purchased a townhouse which DH and I can afford. I titled it in a way where if we default on our student loans our creditors will only be able to garnish our wages if it ever came to that. Not a big deal at all to pay a 15% garnishment as it's far lower than my actual payment.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How old are you? Is this another one of those.. "I make x figures and I should be able to live like Y like those other folks (who happen to be like 15 years older than you"?

I'm 49, DH is 54. We both grew up lower/middle class, but neither of us have student loans because we worked our way through college, and I commuted to college from home. Those were the things I gave up to not have a loan when I graduated.

I lived below my means even when I started making six figures almost 20 years. That's how we were able to afford a nice house with a smallish mortgage.

If you are under 40, you have a ways to go. Yes your income is high compared to the rest of America, but not compared to the DC area. That's the problem. We used to live in an area more expensive than here.

Set your expectations to what is reasonable. Otherwise you will always feel like you're just keeping your head above the water rather than inching towards the coastline.

I am as you describe under 40. Unfortunately I had no opportunity to make decent income until after I took out my student loan debt - the IT industry went into full outsource mode just as I was ready to move up from my entry level position. You are right that there is always another $100k income I need to grasp at. Unfortunately my field is not that profitable in the private sector.

The IT field did not go full outsource mode. There are plenty of jobs and companies hiring. You either don't have the skill level or qualifications needed or are not trying hard enough.

I agree. Both DH and I are in IT and there is so much money to be made, it is obscene. I dont even have a degree and am on track for 300k this year. Dh makes a bit less, but had ridiculous RSUs.

What field are you in? You must be good at what you do to be on track for 300K in IT.

[Anonymous]

Anonymous wrote:

Anonymous wrote:After reading all of this, just wanted to share the advice my firm’s free PWM advisor told me re:loans. Paying them off before investing in anything (a house, equities, even my 401k) is not a choice. Because, at the end of the day, paying them off IS an investment, in and of itself. Every cent I pay towards them now, is multiple more cents I won’t pay down the line.

He told me that I cannot truly worry about anything outside of an emergency fund before wiping these out. Sorry if totally off topic, but the reframing (paying off loans = investing) really helped me jumpstart getting serious about getting them down ASAP.

OP here, that is a great way to look at loans you are able to pay off but not really applicable to my situation. My large loans were in negative amortization for 2 years before I made a decent salary making my loans more a loss I need to shield from liability. So instead I purchased a townhouse which DH and I can afford. I titled it in a way where if we default on our student loans our creditors will only be able to garnish our wages if it ever came to that. Not a big deal at all to pay a 15% garnishment as it's far lower than my actual payment.

Not PP but I’m in finance and I still don’t get this- why wouldn’t you just rent a cheaper place? Why the f would you buy a townhouse instead of paying off loans when you could rent..

[Anonymous]

Anonymous wrote:I'm a little worn out from the grind so just wondering if this whole UMC life becomes more comfortable once your net worth is in the green. Not looking for budgeting advice but would love to hear other experiences. Quick background, I grew up poor but now our combined income is ~$220k/year. Unfortunately our net worth is -$700,000 with the vast majority of the negative being new 30 year mortgage and two absolutely massive student loans from law school. It would be 7 figures in the red if not for our retirement accounts and the "equity" in our townhouse. I am very bitter about my student debt but I have to admit it was the price I had to pay to make six figures. My social security statement shows that the most money I made prior to law school was $28k in a year.

Our cash flow is fine although the vast majority goes to daycare (2 kids), mortgage, huge student loan bills, and insurance. My parents visited recently and were shocked that we weren't popping bottles of champagne and burning bills given that our HHI is probably 5x what they ever earned (and they actually have a SFH). So what is the point of this rat race and when do you actually come out ahead?

Wait...you have massive student debt and still only have a combined HHI of 220k? Yikes!

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How old are you? Is this another one of those.. "I make x figures and I should be able to live like Y like those other folks (who happen to be like 15 years older than you"?

I'm 49, DH is 54. We both grew up lower/middle class, but neither of us have student loans because we worked our way through college, and I commuted to college from home. Those were the things I gave up to not have a loan when I graduated.

I lived below my means even when I started making six figures almost 20 years. That's how we were able to afford a nice house with a smallish mortgage.

If you are under 40, you have a ways to go. Yes your income is high compared to the rest of America, but not compared to the DC area. That's the problem. We used to live in an area more expensive than here.

Set your expectations to what is reasonable. Otherwise you will always feel like you're just keeping your head above the water rather than inching towards the coastline.

I am as you describe under 40. Unfortunately I had no opportunity to make decent income until after I took out my student loan debt - the IT industry went into full outsource mode just as I was ready to move up from my entry level position. You are right that there is always another $100k income I need to grasp at. Unfortunately my field is not that profitable in the private sector.

The IT field did not go full outsource mode. There are plenty of jobs and companies hiring. You either don't have the skill level or qualifications needed or are not trying hard enough.

I agree. Both DH and I are in IT and there is so much money to be made, it is obscene. I dont even have a degree and am on track for 300k this year. Dh makes a bit less, but had ridiculous RSUs.

What field are you in? You must be good at what you do to be on track for 300K in IT.

Operations (management)...and as mentioned I work in the technology industry.

[Anonymous]

Anonymous wrote:

Anonymous wrote:After reading all of this, just wanted to share the advice my firm’s free PWM advisor told me re:loans. Paying them off before investing in anything (a house, equities, even my 401k) is not a choice. Because, at the end of the day, paying them off IS an investment, in and of itself. Every cent I pay towards them now, is multiple more cents I won’t pay down the line.

He told me that I cannot truly worry about anything outside of an emergency fund before wiping these out. Sorry if totally off topic, but the reframing (paying off loans = investing) really helped me jumpstart getting serious about getting them down ASAP.

OP here, that is a great way to look at loans you are able to pay off but not really applicable to my situation. My large loans were in negative amortization for 2 years before I made a decent salary making my loans more a loss I need to shield from liability. So instead I purchased a townhouse which DH and I can afford. I titled it in a way where if we default on our student loans our creditors will only be able to garnish our wages if it ever came to that. Not a big deal at all to pay a 15% garnishment as it's far lower than my actual payment.

You are a piece of work, OP. I truly hope younger people read this entire thread as a cautionary tale.

[Anonymous]

Anonymous wrote:

Anonymous wrote:After reading all of this, just wanted to share the advice my firm’s free PWM advisor told me re:loans. Paying them off before investing in anything (a house, equities, even my 401k) is not a choice. Because, at the end of the day, paying them off IS an investment, in and of itself. Every cent I pay towards them now, is multiple more cents I won’t pay down the line.

He told me that I cannot truly worry about anything outside of an emergency fund before wiping these out. Sorry if totally off topic, but the reframing (paying off loans = investing) really helped me jumpstart getting serious about getting them down ASAP.

OP here, that is a great way to look at loans you are able to pay off but not really applicable to my situation. My large loans were in negative amortization for 2 years before I made a decent salary making my loans more a loss I need to shield from liability. So instead I purchased a townhouse which DH and I can afford. I titled it in a way where if we default on our student loans our creditors will only be able to garnish our wages if it ever came to that. Not a big deal at all to pay a 15% garnishment as it's far lower than my actual payment.

OMG

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:After reading all of this, just wanted to share the advice my firm’s free PWM advisor told me re:loans. Paying them off before investing in anything (a house, equities, even my 401k) is not a choice. Because, at the end of the day, paying them off IS an investment, in and of itself. Every cent I pay towards them now, is multiple more cents I won’t pay down the line.

He told me that I cannot truly worry about anything outside of an emergency fund before wiping these out. Sorry if totally off topic, but the reframing (paying off loans = investing) really helped me jumpstart getting serious about getting them down ASAP.

OP here, that is a great way to look at loans you are able to pay off but not really applicable to my situation. My large loans were in negative amortization for 2 years before I made a decent salary making my loans more a loss I need to shield from liability. So instead I purchased a townhouse which DH and I can afford. I titled it in a way where if we default on our student loans our creditors will only be able to garnish our wages if it ever came to that. Not a big deal at all to pay a 15% garnishment as it's far lower than my actual payment.

You are a piece of work, OP. I truly hope younger people read this entire thread as a cautionary tale.

Let's just say I learned a lot during my private practice days helping people with "debt modifications" and collections defense.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:After reading all of this, just wanted to share the advice my firm’s free PWM advisor told me re:loans. Paying them off before investing in anything (a house, equities, even my 401k) is not a choice. Because, at the end of the day, paying them off IS an investment, in and of itself. Every cent I pay towards them now, is multiple more cents I won’t pay down the line.

He told me that I cannot truly worry about anything outside of an emergency fund before wiping these out. Sorry if totally off topic, but the reframing (paying off loans = investing) really helped me jumpstart getting serious about getting them down ASAP.

OP here, that is a great way to look at loans you are able to pay off but not really applicable to my situation. My large loans were in negative amortization for 2 years before I made a decent salary making my loans more a loss I need to shield from liability. So instead I purchased a townhouse which DH and I can afford. I titled it in a way where if we default on our student loans our creditors will only be able to garnish our wages if it ever came to that. Not a big deal at all to pay a 15% garnishment as it's far lower than my actual payment.

You are a piece of work, OP. I truly hope younger people read this entire thread as a cautionary tale.

Let's just say I learned a lot during my private practice days helping people with "debt modifications" and collections defense.

This is why they need to include a basic life finances class in school. OP is out of her mind.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:After reading all of this, just wanted to share the advice my firm’s free PWM advisor told me re:loans. Paying them off before investing in anything (a house, equities, even my 401k) is not a choice. Because, at the end of the day, paying them off IS an investment, in and of itself. Every cent I pay towards them now, is multiple more cents I won’t pay down the line.

He told me that I cannot truly worry about anything outside of an emergency fund before wiping these out. Sorry if totally off topic, but the reframing (paying off loans = investing) really helped me jumpstart getting serious about getting them down ASAP.

OP here, that is a great way to look at loans you are able to pay off but not really applicable to my situation. My large loans were in negative amortization for 2 years before I made a decent salary making my loans more a loss I need to shield from liability. So instead I purchased a townhouse which DH and I can afford. I titled it in a way where if we default on our student loans our creditors will only be able to garnish our wages if it ever came to that. Not a big deal at all to pay a 15% garnishment as it's far lower than my actual payment.

You are a piece of work, OP. I truly hope younger people read this entire thread as a cautionary tale.

Let's just say I learned a lot during my private practice days helping people with "debt modifications" and collections defense.

Apparently not.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:After reading all of this, just wanted to share the advice my firm’s free PWM advisor told me re:loans. Paying them off before investing in anything (a house, equities, even my 401k) is not a choice. Because, at the end of the day, paying them off IS an investment, in and of itself. Every cent I pay towards them now, is multiple more cents I won’t pay down the line.

He told me that I cannot truly worry about anything outside of an emergency fund before wiping these out. Sorry if totally off topic, but the reframing (paying off loans = investing) really helped me jumpstart getting serious about getting them down ASAP.

OP here, that is a great way to look at loans you are able to pay off but not really applicable to my situation. My large loans were in negative amortization for 2 years before I made a decent salary making my loans more a loss I need to shield from liability. So instead I purchased a townhouse which DH and I can afford. I titled it in a way where if we default on our student loans our creditors will only be able to garnish our wages if it ever came to that. Not a big deal at all to pay a 15% garnishment as it's far lower than my actual payment.

You are a piece of work, OP. I truly hope younger people read this entire thread as a cautionary tale.

Let's just say I learned a lot during my private practice days helping people with "debt modifications" and collections defense.

Mkay, I don't think so.