Time to jump the SAVE ship?
Out of curiosity, I was comparing income based plans. I used the fafsa loan repayment plan calculator and what I saw was sort of mind blowing. Under my current SAVE plan:
-Monthly payment: $908
-Total to be repaid: $121,199
-Forgiveness date: February 2035
-Forgiveness amount: $274,681
-Qualifying payments: 178/300
But if I switch to IBR:
-Monthly payment: ~$1800
-Total to be repaid: 114,678
-Forgiveness date: April 2030
-Forgiveness amount: $245,899
-Qualifying payments: 176/240
From what I understand, IBR forgiveness is not under the hammer and is separate from all other IDRs currently under injunction.
Assuming I can (grudgingly) afford the x2 payment amount of the IBR plan, shouldn’t I switch? Doesn’t this mean I could be done in 5 years and pay slightly less out of pocket overall and owe less tax for the amount forgiven?
What’s the downside? Feels like there’s a catch somewhere that I’m missing.
What would you do?