What kind of interest rate do you have? My loans will be paid off at the end of this year after 10 years of payments. Each month, I saw the principal drop a bit.
It's now a fixed 6.5% on my federal loans. Its roughly the same on several private loans. What killed me (aside from being stupid enough to borrow money and go to law school) was doing exactly what TarpleyG is talking about. My loans were in the 8.5-9.5% range when I was in school and I had them all on deferment. If I had to borrow money to go to school, where was I going to come up with thousands a year to make interest payments?
When I finished school and got a job, it did not pay nearly enough to make regular payments on all my loans, so I had to use deferments and forbearances on some loans and pay on others.
What they don't tell you when you get accepted to law school and get full financial aid (which pretty much everyone does unless their family is wealthy or they're older and retired from their first job with money to burn) is that you'll need to be making over $100,000/yr starting the day you get out of school to pay off your loans in 10 years.
I can count the number of classmates I had that got that kind of job on one hand (maybe less) and none of them stayed with those jobs for more than a year or two. Most (like myself) took jobs with small to medium sized firms or governmental entities making $50,000/yr or less (sometimes way less). It is impossible to pay rent/utilities/insurance/car repair/health care/food/clothes/credit card debt/etc. and still make full payments on student loans if the best job you can get with your new degree only pays $30,000. For this very reason many law school grads filed for bankruptcy in the 80's/early 90's, which prompted stiffer laws that made discharging student loan debt through bankruptcy next to impossible. If it werent for the USDEs income contingent repayment program on the federal loans, Id have been forced to try bankruptcy by now, even if it is harder to do.
I've reconsolidated my federal loans and almost paid off my private loans. I haven't purchased anything on my credit cards in several years and Im working hard to pay them off because their interest rates rocketed up to 4-5 times that of my student loans. Some kid started asking me questions about my car the other day and told me it had achieved collectible status. Aside from a few guns and some ammo, I havent purchased anything I dont need. I work long hours and usually put in at least half a day on Saturdays and Sundays. I quit hanging out with a lot of friends because my spending habits no longer matched theirs.
I can easily say that student loan debt has had an enormous impact on my quality of life. If I could go back, I wouldnt do it again, but I did it and Ive got to figure out how to make the best of it. Be thankful if you only have a few thousand, or few tens of thousands in student loan debt. Avoid scams, research carefully, read the fine print, consolidate at a fixed low rate, and pay as much as you can on them.
