- Joined
- Sep 13, 2016
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- 190
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So I'm a M2 and I am trying to navigate my way to the best financial decision but I'm a little unsure on some things. I've looked around on the internet (including WCI) for help but seem to find the answer to my specific question. I'm married and my wife is a full-time nurse with around 20k of student loan debt herself. I have 20k from masters and then have been taking out the full COA from my state school (58k year). All our loans are federal and interest rates are very close if not the same.
I don't necessarily need to take out the full COA from my school every year with her income as we could survive on less. That said, she doesn't make enough to where I wouldn't have to take out any living expense money. We are probably looking at anywhere from 4-8k/year I could take out less for living expenses. Now she's in about year 4 of a 10 year repayment plan but we've recently been paying that down more aggressively with the goal to have it paid off at the end of school (including the tax refunds we've gotten its doable).
Now my question is am I being stupid because I'm essentially paying off debt with debt? Which is what I've always heard not to do. I could take out less and we would pay down her debt less. But my thought is theoretically ANY money we put towards her loans is paying off debt with debt assuming I am taking out any money for living expenses. My other thought is even though I'm taking out more loans than I need, my refinance options as a physician in the future should be better than what she has now? So by paying off her loans quickly then I would be able to refinance mine with a lower interest rate in the future. I'm just not well versed with the way interest accumulates or capitalizes and what strategy would save me the most money over the longer term.
I don't necessarily need to take out the full COA from my school every year with her income as we could survive on less. That said, she doesn't make enough to where I wouldn't have to take out any living expense money. We are probably looking at anywhere from 4-8k/year I could take out less for living expenses. Now she's in about year 4 of a 10 year repayment plan but we've recently been paying that down more aggressively with the goal to have it paid off at the end of school (including the tax refunds we've gotten its doable).
Now my question is am I being stupid because I'm essentially paying off debt with debt? Which is what I've always heard not to do. I could take out less and we would pay down her debt less. But my thought is theoretically ANY money we put towards her loans is paying off debt with debt assuming I am taking out any money for living expenses. My other thought is even though I'm taking out more loans than I need, my refinance options as a physician in the future should be better than what she has now? So by paying off her loans quickly then I would be able to refinance mine with a lower interest rate in the future. I'm just not well versed with the way interest accumulates or capitalizes and what strategy would save me the most money over the longer term.
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