Mo’ money – no debt?

Hi Brooke,

I am currently doing the money course. I find your perspective on debt very refreshing, because I realized that I have preconceived notions about debt (basically that it’s evil) but then I realized that I would definitely go into debt for things like a house or an education. And is that debt more noble than other debt? No – it’s all just neutral.

It’s interesting to me though, because the way that you frame debt – as buying money with money – makes it not a very attractive option in most cases. And, truth be told, I do not have any debt. My husband, however, racked up $175,000 in medical student loans before we met to become a neonatologist. He’s on a student loan forgiveness program and his debt will be forgiven in 5 years at this point. And in fact, every additional dollar we make is basically another dollar we need to pay in this student loan forgiveness program. There are of course ways to reduce our taxable income, which we do to try and pay as little possible on the loan knowing that the less we pay each money, the more will be forgiven in about 5 years. I feel very fortunate this our situation and in a way I’m glad that my husband was able to borrow this money to fund his education – he has an incredibly stable job and can provide very well for his family.

I find myself thinking that this student loan forgiveness program is almost like an incentive make LESS money because the MORE money you make the MORE you pay back during your payment window of 10 years (so it means the difference between paying about half or a quarter of the loan in the same time period, for example and still have whatever is left – whether it be closer to $100,000 or $140,000 – be forgiven).

But at the same time, I’m like well, there’s lots of avenues we can take to reduce our taxable income and still make more money – so that’s the route I’m going with. In any case, I just wanted to share this example because I find it unique and fascinating in regards to what my mind does with it.