What is your student loan payoff strategy? Tim Ulbrich, PharmD  

Mission To empower a community of pharmacists and pharmacy students to achieve financial freedom. www.yourfinancialpharmacist.com

Learning Objectives At this end of this session, you should be able to: Describe the landscape of pharmacy graduate indebtedness Evaluate the current status of your loans Describe the pros/cons of the public service loan forgiveness (PSLF) program Describe the difference between consolidation and refinancing www.yourfinancialpharmacist.com

Hello, Student Debt www.yourfinancialpharmacist.com

www.yourfinancialpharmacist.com

AACP Graduating Student Survey, 2017 The average amount borrowed for students graduating from pharmacy school in 2017 was $163,494. AACP Graduating Student Survey, 2017 www.yourfinancialpharmacist.com

Know and Respect the Power of Compounding Debt www.yourfinancialpharmacist.com

How Much Goes to Interest? 44% of payment goes to interest 38% of payment goes to interest

What’s 10 More Years To Pay It Back? $150,000 of school loans at 6% interest for 10 years = $1,665 payment / month Total payout = $199,837

What’s 10 More Years To Pay It Back? $150,000 of school loans at 6% interest for 20 years = $1,075 payment / month Total payout = $257,915

What’s the best path forward? www.yourfinancialpharmacist.com

How does your total student loan debt make you feel? www.yourfinancialpharmacist.com

Steps to Take With Your Loans Inventory your loans Determine your payoff strategy Access repayment plans, other www.yourfinancialpharmacist.com

Inventory www.yourfinancialpharmacist.com

Inventory Determine the loan type(s) Determine the status Determine the terms www.yourfinancialpharmacist.com

Example

Example Repayment Estimator: https://studentloans.gov/myDirectLoan/mobile/repayment/repaymentEstimator.action

Determine Your Payoff Strategy www.yourfinancialpharmacist.com

Student Loan Payoff Strategy Federal Loan Program Forgiveness (PSLF or non-PSLF) Non-forgiveness www.yourfinancialpharmacist.com

Public Service Loan Forgiveness (PSLF) Program 1. Work for the right type of employer 2. With the right kind of loan 3. In the right repayment plan   4. Make the right amount of payments 5. Prove it 6. Apply and receive tax-free forgiveness www.yourfinancialpharmacist.com

Non-PSLF Forgiveness 1. Work for the right type of employer 2. With the right kind of loan 3. In the right repayment plan   4. Make the right amount of payments 5. Prove it 6. Apply and receive tax-free forgiveness www.yourfinancialpharmacist.com

Non-Forgiveness 25 years All in 10 year Standard www.yourfinancialpharmacist.com

Non-Forgiveness 25 years All in 10 year Standard www.yourfinancialpharmacist.com

Assess Payment Plans, Other www.yourfinancialpharmacist.com

Repayment Plans Standard Income Based (IBR) X2 Graduated Income Contingent (ICR) Extended Pay As You Earn (PAYE) Extended Fixed Revised Pay As You Earn (REPAYE) www.yourfinancialpharmacist.com

Repayment Plans Standard Income Based (IBR) X2 Graduated Income Contingent (ICR) Extended Pay As You Earn (PAYE) Extended Fixed Revised Pay As You Earn (REPAYE) www.yourfinancialpharmacist.com

Income Driven Plans Calculate payments based on the following variables: Balance Interest rate Tax filing status Income (AGI) Family size State of residence Need to submit info every year even if situation does not change www.yourfinancialpharmacist.com

Consolidation & Refinance www.yourfinancialpharmacist.com

Refinancing Student Loans Worth evaluating for those with: High(er) interest rate loans Higher the debt load = higher potential savings Not pursuing PSLF Able to make aggressive payments Not dependent on benefits of federal loan repayment program

Before you refinance… No prepayment penalty No origination fees Determine which loans you do and do not want to refinance

Student Loan Refinancing Guide yourfinancialpharmacist.com/refinance

Q&A Tim Ulbrich, PharmD www.yourfinancialpharmacist.com

What is your student loan payoff strategy? Tim Ulbrich, PharmD