The income piece doesn't matter for this particular forgiveness program. I just need to make 120 monthly payments on time while simultaneously working at a public service job.
I read a post on another board that kind of resonated with me stating that I legitimately used this money and now it's my responsibility to pay it all back. It also said something regarding th lovely feeling of not having that payment looming over my head for 10 years. I'd rather challenge myself to get rid of it in say 5 years and have more options. As I was re-reading another investment post by MMM, he said "the best guaranteed no-volatility place to invest your money may be paying off existing debt. Your mortgage, your student loan, or if you still have superbad loans like car or credit card debt, you need to get on those, emergency style, before you consider saving for anything else."
I think this subject is worth reconsidering.
It seems to me that if you're working in a public service job, then you're repaying the government's investment in you with sweat equity. You've been persuaded to go into a career that may still be fulfilling, but is likely to pay less than being a Wall Street broker or a business owner. Even if the program's enabling legislation is canceled, I think you'd be grandfathered in under the current system until your 10 years is finished.
Many people pay off high-interest debt because it's almost impossible to earn more at investing when you're carrying high interest payments. Some people like paying off their home mortgages early because they sleep better at night when they're debt free. But there are other people who enjoy having low-interest 30-year home mortgages because they can earn more (with a diversified investment portfolio) than the carrying cost of the funds. Low-interest debt is not for everyone, but the math works no matter how you feel about it. It takes guts & discipline, but the math works.
MMM makes a good point about paying off student loans early, but there are several kinds of student loans. I interpret his guidance to mean the high-interest private loans that will financially cripple anyone trying to establish their emergency funds and their savings. I do not think he intended his advice to apply to low-interest government loans with alternative payment programs... but I'll let him clarify that if clarification is necessary.
So if I was in your situation, I'd pay the absolute minimum on your student and not a penny more. I'd stick to that public service job (if you can tolerate it) until your balance is forgiven. I'd stop worrying about carrying the debt, and every morning when you head off to the job I'd remind myself that you're paying off your debt with your labor in service.
It is not your responsibility to accelerate the payments, and it's not your responsibility to sacrifice even more of your personal capital above & beyond your human capital.
I may be a little biased on this subject. I was given huge government loans for my 1980s undergraduate and graduate degrees-- to the tune of at least $250K. (Nobody kept a tab on the exact number.) I didn't pay a nickel. I was given free room & board and a stipend for the first four years, along with free organizational clothing. Later I was given a fair living wage with a food & housing allowance. I got regular salary raises and even a few bonuses, and I was earning a living wage suitable for raising a family. All I had to do in return was give up about nine years of my life for public service. I certainly used the money that I was given, but I feel that the government got fair value for their investment.
