re: Student Loan Repayment Options Explained

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Using the PLSF and the IBR plan is currently saving me a buttload each year. Granted at current career trajectory it will end up being a wash in the later years.

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There's a lot of math involved. You have inflation working in your favor. Also, the amounts you save can be invested over that 25 year period. You also have the fact that you'll pay the taxable percentage of the forgiven amount, not the whole amount. The more mundane thing is that IBR allows you to sock away an emergency fund so you don't become a ward of the state (in the traditional sense).


There's a reason why IBR "loopholes" are being discussed for closing, since high wage earners with high debt would be smart to take IBR or PAYE all the way to forgiveness, even with the tax bomb.