I am a senior studying Mechanical Engineering at Boston University, and in about 5 weeks I will be graduating with what feels like an overwhelming amount of debt. While I am confident in my abilities as a student, I do not yet have a job lined up. I plan to live at home (rent free) for as long as possible, immediately following graduation. I am trying to be as real about this as possible.
I have been refering to r/personalfinance and r/StudentLoans for guidance, but right now I feel defeated. I'm not looking for pity, and I take ownership of the fact that I alone put myself in this situation. I just hope that you guys will be able to look at my gameplan and be able to tell me that everything will be okay.
Here's a breakdown of my loans as they stand today:
| Loan Type | Servicer | Principal ($) | Interest Rate (%) |
|---|---|---|---|
| Stafford (Subsidized + Unsubsidized) | MOHELA | 27,000 | 4.39 |
| Private (Academic Answer Loan) | Suntrust | 29,300 | 8.95 |
| Private | Discover | 24,130 | 10.49 |
| Private | Discover | 28,665 | 11.99 |
| Private | Discover | 31,093 | 11.59 |
I will be moving back home to East Tennessee, where the average base salary for an entry-level mechanical engineer is around $70k. From my experience looking at salaries on various job postings, I believe that my actual salary will be more around $60k. I still need to get a job though... My resume is decent, and my GPA is a 3.66, so I'm not freaking out about that just yet. My credit score is 760-770, and I have been establishing credit over the past 4 years. I'm hoping that this will help me as I look for private loan consolidation options.
In terms of expected living expenses, I haven't really figured out a good estimate, but I will be keeping these as low as possible. No going out, cooking at home as much as possible, shopping at thrift stores etc. As mentioned before, I plan to live at home, where I my rent will be paid in chores more or less. I do not have any other outstanding loans or consistent payments (i.e. car payment).
My mom has planned her whole life to help me pay for college, but at this stage in her life I do not know how much of a contribution she will be able to make. She is a single mother and works as a high school teacher. I have nothing but respect for what she does, but it's just a fact that there's not a lot of money to be made teaching. We also have some money (I'm not sure the exact amount) in a college fund, and I have about 6k in savings.
I think that the first order of business is to consolidate my private loans at a more favorable interest rate. I am also planning to absolutely pay off the interest on my federal loans before it capitalizes. I also still need to figure out which payment plan to use for the federal loans. I'm confused by how PAYE and other income-based plans work if I still don't have a job by the time the grace period ends.
I guess the questions I have can be summed up as the following:
- Are there any recomendations for a loan consolidation service? Should I go for fixed or variable rate on the consolidated loan?
- How should I use the money that I have in savings + college fund? I know the general advice is to apply it to the highest interest rate loan, but I don't know if I should consolidate first.
- The values I listed for the federal loans appear as though they are consolidated, but in reality they are a collection of 8 loans with different interest rates. Does the advice of paying off the highest interest rate apply here, or is it better to just consolidate now?
- What payment method is best for the federal loans? I plan to be employed ASAP, but I'm not sure what to do if I don't get a job soon.
- Am I gonna make it out of this giant hole alive??
Thank you for reading this. I think that last year is when I really started to feel as though my choice of school was a mistake, given my experiences reading material on this sub. The weight of my decision has suddenly become the only thing that I can think about, and I partially wrote this post as a way to compartmentalize how I'm feeling. I already regret not having gone somewhere in-state, where I could have avoided loans altogether. Hindsight really is a bitch.
EDIT: Formatting is hard. Table should work now.
EDIT2: Formatting is really hard. Bulletted list works too.
Submitted April 08, 2019 at 07:43AM by RRolld http://bit.ly/2UlnsNg
