I have 284K in debt from medical school (no loans in undergrad). My husband makes 235k and I'll make about 61K in residency (family medicine). I'm conflicted if I should enter a PAYE payment plan, or do a standard 25 year plan. I know my husband makes a lot, but he also supports his parents and his sister abroad (about 3k/month) and unfortunately we have many other expenses. On one hand, I just want to pay back my loan as much as we can. I feel that no matter how much we'll make, my husband will find ways to spend it. For instance, he bought a very expensive watch on a credit card, which we cannot pay back, so now we are paying lots of interest on that. The other day, he sent me an email with houses he wanted me to look at that were around 600k... my jaw just dropped b/c we already talked MANY times how we need to stay in our current house until I finish residency so we can try and save some money. On the other hand, if I choose PAYE, maybe I can try and save some money to have in case of emergency. Any suggestions?
It's great that your husband has such a high salary, and even with the ~36,000 that he sends to his family, that still leaves well over $100k post-tax, plus your take-home salary.
I can't tell you what to do, but I can tell you what I would do if I were in your shoes. First is I'd address the spending problem--I'm a firm believer that you should never make credit card interest payments. Credit cards are for emergency credit in my book, and if baffles me how one could end up having to make credit card payments on a watch when they're taking home six figures. To me that's a big problem. And if you don't address that spending problem now, it'll just continue (or get worse) when your salary jumps up as well.
You're in a very unique situation--you can literally pay off your loans while in residency. Your salary alone is enough to live on, so if you husband put most/all of his post-tax and post-family payment earnings towards your loans, you could be debt-free before you're an attending. That would be really great! The way I see it, it's best to tackle paying off students loans as soon as possible, and you and your husband appear to be in the situation to tackle it very quickly. Even if you have a lot of other expenses you can't eliminate (and I'd recommend looking carefully at those to see what you really need), you could still pay off a huge chunk of your loans while in residency.
I'm not so sure REPAYE would be the best plan for you--you'll end up paying 10% of your and your husband's AGI (assuming you file jointly). If your husband has loans too then it'll take that into account, but otherwise your REPAYE monthly payment could potentially be pretty close to the standard 10-year payment. I'm guessing if you select the 25-year payment plan that could be the cheapest. It's possible PAYE/IBR could have the lowest payments, as I believe they do not take spouse income into account unless you want them to. However, I think you may have to file taxes individually for those, which means you give up all the tax benefits ("free money") of being married, just for the sake of lower payments. To me that wouldn't make sense--give up tax rebates/credits for a lower payment when you can afford the normal REPAYE or 25-year payment anyway.
Regardless of what you do, please don't take 25 years to pay off your loans. It may make financial sense to make minimum payments while in residency if you really need to set money aside, but if you're looking at a combined income around $400,000 and only $250,000 in debt, there's no reason in my mind to still have loans 1-4 years post-residency.
