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I am graduating this semester from an American school with 120k in student loans.

The standard 10-year payment plan suggested to me via email and snail-mail is a little over 1k dollars per month -- which I think is a bit high and ambitious.

So, my question is: what if I instead opted to pay the minimal amount possibly allowed by my loan servicer?

Is there anything wrong with paying off my loans in ... 30+ years...rather than in the more ambitious 10 years?

And if you're willing to answer another short question: what if I am deceased before I pay off my balance? Does the debt get transferred over to a family member, or does that debt just get written off?

Thanks,

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    If you cannot do 10 years why not look for maybe 15 or something ? Why jump straight to 30 ? Is there an hidden motive somewhere, like student loan forgiveness ? – DumbCoder Mar 8 '16 at 12:56
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Last question first: The amount borrowed will not transfer to your loved ones upon death. Even if you were age 50, it is somewhat unlikely you will die in 30 years.

First question: Are you okay with having a student loan that long? Keep in mind that making payments for that long will hinder your ability to build wealth, buy a home, and have disposable income.

Presumably you are used to living like a college student. If you continue to do so, and maybe take on another job (for the time you used to spend in school), you could be done with this much sooner. 2k/month is doable and retires this in 5 years, but I would shoot for a shorter time frame than that.

Hopefully by purposely incurring that much debt you bought yourself a high paying career.

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    +1, and forgive my edit, embolding the most brilliant words in your answer. Of course you can reverse that, if you wish. – JoeTaxpayer Mar 8 '16 at 14:58
  • This depends on if the user is able to find employment paying a decent salary. If they can only find two part-time jobs, they could be stuck making around 30,000 a year, which means 2k/month is not doable, even living like a college student. Otherwise, this doesn't seem to answer the question of "is there anything wrong with paying this off in 30+ years?" – TylerH Mar 8 '16 at 15:16
  • If he were able to pay off 2K a month, I doubt he would be asking for a strategy to pay it off! – Mohair Mar 10 '16 at 13:34
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The obvious disadvantage of paying loans off more slowly is that you will pay a lot more in total interest... Which means less savings and less disposable income on the long term. Unless you are doing something with the money which produces more income than the interest costs you, this is very much "penny wise, pound foolish".

If you aren't making money by paying that money, all you can do is loose money at the slowest rate you can afford. You do that by paying off the loan as quickly as you can afford to do so. It's up to you to look seriously at your finances and decide what your real needs are, how you're going to meet them, and how much you can afford beyond that while still paying off the loans as quickly as possible.

Sloppiness now will cost you much more than you expect layer, due to the compounding you will have missed out on. Really.

See the questions about how to start saving/investing for answers that discuss how to prioritize your money. There are some steps you should be taking ASAP if you haven't already done so.

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