OP your husband’s loans will be forgiven after the 20/25 years of payments regardless of whether your joint income increases. He will never be kicked off IBR, as long as he recertifies each year. If your income increases to where you would not have initially been eligible for IBR, you remain on IBR but make standard payments. Then both the earlier and new standard payments count towards the 20/25 years of payments. IDR forgiveness is les strict than PSLF. Even if you start on a standard plan and then switch to an IDR plan, all the payments count towards the 20/25 years of payments. And missing payments or deferring the loans doesn’t disqualify you from IDR or forgiveness, those months just don’t count (except economic hardship deferments, those actually count towards the 20/25 years). You don’t have take my or any internet stranger’s word for it. Here’s the Dept of Ed saying so:
https://studentaid.gov/manage-loans/repayment/plans/income-driven/questions (Under header “Repayment Period and Loan Forgiveness;” subheader “What does “after 20 or 25 years of qualifying repayment” mean?”)
Also, don’t blindly refinance the loans and give up the federal benefits, especially when your husband has such a low interest rate. Prime example: for the last six months the interest rate on all federal loans has been 0% and all payments deferred. These non-payment months count towards IDR (and PSLF) forgiveness. And the deferment is extended until end of December. 9-10 months of 0%! Please, please, please tell me you guys haven’t been making SL payments since March.
You need to compare the actual savings of refinance to losing federal benefits. For example, on the gov standard ten year payment plan you guys would pay $591/month or $70,969 over ten years. If your husband refinances to say 3.5%, that’s over 1% percentage lower, but only saves him ~$3,650 over ten years ($365/ year). Is that worth losing the federal benefits and flexibility? Maybe it is to your husband, but he should look at the total amount saved vs just assuming a lower interest rate is going to save a ton of money. Also, note that the advertised low rates usually include an assumption that you will use the .25% autopay discount. The fed has the same discount, so if the 4.625% rate doesn’t already include it, make sure you factor that in when comparing rates.
Now that said, if I were you, I would suggest that your husband switch to the gov 10 year standard plan. It sounds like you guys can afford it and it guarantees the loans will be gone in 10ish years with no fuss. (But don’t make payments now with 0% interest!!! It extends the time until they are gone, but doesn’t cost you anything more. It’s better to put that towards your retirement.) A 10 year payment will save money in the long run, and it is a good balance between wanting them gone sooner but also having a lot of extra money to put into retirement (while also retaining the fed benefits). At your age, you have time on your side, but you’re not
that far off from not having time on your side. So it’s important, regardless of FIRE plans, to be investing your retirement plans now. I wouldn’t pay off his loans early due to that. If he was 22, then fine, spend 2 years cranking down on the loans.
If he switches to the gov 10 year plan, his payment should be around $591/month and the overall paid amount (for those ten years) will be around $70,969. If he remains on IBR and his payments stay at $350 and his forgiveness is 18 years away, that’s $75,600 in (18 years of) payments + tax on the ~$29,700 that will be forgiven. If your joint income goes up, then his total payments on IBR will also go up, unless it goes up so much that he ends up on standard repayments (then it will likely be paid down sooner than 18 years decreasing overall amount compared to full IBR). It’s hard to guestimate exactly will happen over 18 years of IBR payments! But I’ll note that an increase in overall payments wouldn’t be because he messed up and had to start over - any loan plan that is longer will end up costing more. I.e. a 30 year mortgage will cost you more than a 15 year mortgage, but folks still find a low interest 30 year mortgage to be beneficial.
