Private College Student Loan

Extremely stressed out about student loan repayment...?

I am just about to earn my bachelor's degree, and I have almost $100,000 in student loan debt. I took out student loans to pay for living expenses in addition to school. Now, I'm getting ready to enter graduate school, where I will undoubtedly incur even more debt...probably another 100K since it will be anywhere from 4-6 years and I will be paying out of state tuition. By the time I'm done, I'll have around 200k of student loan debt....and I am seriously stressing. I'm going to get my PsyD in clinical psychology, so if I can find a decent job after school I might be okay....but I looked at a loan calculator online and it said that my monthly payments are going to be around $1600/mo. with that much debt...and that's with a 30 year repayment plan!! The national average for the salary for a clinical psychologist is about $75,000, and I will most likely be paid less than that just starting out. I figure if I can get a job that pays $50,000/year I will only be taking in about $3200/mo after taxes and health insurance....and the monthly payment for the student loans is HALF of that! I don't see how I am going to be able to make it.... I really want to get this education so that I can be successful and have a satisfying career, but this is insane! I am a broke college student working in a call center, so I barely have enough money to pay my rent and bills, let alone save for college. Loans are the only way I can pay for school What can I do??? How would you suggest I be more realistic? How would you suggest I be more realistic?

Public Comments

1. LOL wow......ur not gonna be able to pay that off in today's economy.. u need to be more realistic
2. Go to school in state. Get a job while you are going to graduate school and try to avoid any more loans. Student loans can be graduated, so that your payback starts low and goes up as your income increases. But seriously, you should change plans and go to a less expensive school choice and, as I said, get a JOB. It may take longer, but at least you won't add to your debt. Not sure what you used for your calculations. But my loan is less than 3% interest. So I ran your number of 200K through a loan calculator at 3% and it was $850, not $1600. I assume you are getting loans through a federal program and not foolish enough to go through private agencies. You have the equivalent of a mortgage and you haven't even got a house. There are some plans that say if you agree to work for the government, they will forgive your loans, but it has to be several years and the amount is varied. I haven't kept up with it, but you should ask your financial aid advisor about it. Also, apply for any and all scholarships you qualify for. A lot of them go unclaimed because people don't apply. Not all require financial need.
3. The question is, will you be able to qualify for a 30-year repayment plan? This isn't a mortgage, and the standard repayment plan is 10 years... which will put your monthly payments at $2,300 - $3,000/month (depending on your interest rate). You should not have taken out loans to live on... that's what a job is for (and I'm sure that you realize that now). I would suggest that you take a year or two to work full-time (possibly two jobs) before graduate school so that you can pay off some of your undergrad. loans and save up for graduate school. If you can get one full-time job at $14/hour, then you'll net around $25,000 in a year. Get a second part-time job at $9/hour at 25 hours/week and you'll net almost $10,000 for the year. See if you can move in with your parents and live rent free for two years (offer to cook, do dishes, do laundry, mow grass, etc if they're wary about the rent-free part). Give up a cell phone and spend as little as possible to live - which, if you're living rent-free you could probably get by on $100 - $200/month... you might have to stick with public transportation or a bike. Basically, in two years you could pay of $60k of your student loan debt. If you work two full-time jobs, you may be able to pay off the full $100k in 2 years. Then, you could work 1 more year and save money to pay for your graduate school - at least some of it. It's unlikely that you're going to make enough to afford to live even halfway comfortably for the first decade if you graduate with $200k in debt. To pay that off in the standard 10 year plan, you're going to need an annual income of almost $300,000 (http://www.finaid.org/calculators/scripts/loanpayments.cgi). To pay it off in the 30-year plan you'll need an annual income of $160,000 -- which you're only estimating that your income will be $50,000 - meaning that you cannot afford to go to graduate school without paying off some of your debt first. Plus, if you extend the loan to 30 years, you're going to be paying over $200k in interest alone! That's ridiculous. Choose to live a few years of an uncomfortable life now... instead of having to work your butt off and live in poverty for the next 30. Education is wonderful and so is a satisfying career; however, is that career going to be as satisfying if you have to work 2 jobs for the next 30 years and cannot purchase a home, a car, go on any vacations, etc? Your debt-to-income ratio is going to be way to high and you will not be able to get approved for any loans (mortgage, car, etc.). The average undergrad student graduates with $24k in student loan debt -- you have chosen to graduate with almost 5 times that amount. You needed to attend a much cheaper school... much cheaper. In addition, it sounds like you need to look into another graduate school - one that will be cheaper. You should also look for a program that will allow you to work at the school, so that you can benefit from a tuition discount (I know a few people who are getting their doctorate in Psychology who have used this option). Please remember that the national average has nothing to do with what you might actually make. The national average for my previous job was $49,000/year - I made $19,000/year, only 39% of the national average. You have to remember that the cities' that pay the best also have the highest standard of living -- and you are likely not going to be able to afford to live there. You are in a dangerous situation right now. It would be easy to continue on and not worry about this problem for another 4 years -- except when you graduate then and find yourself unable to get a job because your credit is so horrible because you've had to default on your loan payments, unable to get an apartment because your debt-to-income ratio is already way to high, etc... you're not going to have much of a life. You are either going to be stuck living with your parents for many years (if they'll allow it), sleeping on a friends' couch, or living in a shelter/motel/your car. You don't want that to happen. Take a few years off from school - even though I'm sure that you don't want to. Go through hell for the next 3 years instead of living in hell for the next 30+ years.