> this guy has the financial acumen of a brick
Sounds like he's doing the smart thing at this point, doesn't it? He borrowed over $600,000. By the end of the 25 year period he'll likely have paid back less than the original principal.
Sounds like he's doing the smart thing at this point, doesn't it? He borrowed over $600,000. By the end of the 25 year period he'll likely have paid back less than the original principal.
"Since refinancing his debt with the federal government in 2015, lowering the rate to 7.25%, Mr. Meru’s balance has grown by $148,948. It will keep growing through the 25-year life of the repayment plan until it reaches $2 million. That sum will be forgiven and, at current tax rates, could cost Mr. Meru more than $700,000 in income tax payments.
By then, Mr. Meru will have paid $1.6 million. That would be about the same as repaying his $600,000 in student loans at a rate of 4% over 25 years, said Jason Delisle, a student-loan expert with the American Enterprise Institute, a conservative think tank. The biggest factor in Mr. Meru’s runaway debt, he said, was a high principal combined with long periods when Mr. Meru made no payments."
> lowering the rate to 7.25%
> repaying his $600,000 in student loans at a rate of 4%
These two things don't jive. Did he have the option of a loan at 4% at some point?