The decision you're stuck on

Last week, I talked about what’s coming — SAVE is gone, payments are jumping, and you have until September to pick a new plan.

This week I’ve had the same conversation a dozen times. Someone sits down, we run the numbers, and then they go quiet. Not because they don’t understand. Because they do.

One borrower looked at her IBR payment — $1,500 a month — and said, “More than I was hoping for.” Her husband had already done the math. He knew. She just needed to hear it out loud.

Another borrower could save $300 a month by switching plans. She wouldn’t do it. “I’m scared to make changes,” she told me. “I don’t trust them to process things correctly and on time.” She wasn’t confused about the math. She was afraid of messing something up that had already felt beyond her control for years.

That’s the thing about this decision. There’s the mathematical answer, and there’s the emotional answer. For most people I sit down with, the emotional answer wins.

IBR gets you to forgiveness faster. But if your payment doesn’t cover the interest, your balance grows — and watching it climb while you’re doing everything right feels like injustice stacked on injustice. (And that’s to say nothing of a potential tax bomb.)

RAP protects you from that. Unpaid interest is waived. Your balance stays flat or comes down. But you’re also signing up for five more years of payments. Ten more years if you borrowed your first loan in 2014.

I made a video walking through how to actually think about this: IBR vs RAP: How to Decide

It’s not long. I break down the trade-offs, run real numbers, and explain why the answer depends on when you borrowed — not just what you owe.

And if you want to walk through your situation, you can schedule a consultation here: https://www.tateesq.com/book-a-call

I’m headed to Boston tomorrow to train bankruptcy attorneys from across the country on filing adversary proceedings against private student loan lenders. It’s become something of a specialty — I’m one of the few attorneys who uses bankruptcy to go after private loans.

Boston isn’t one of my favorite cities. That said, I’m looking forward to stopping by Boston Cigar Lounge and finally lighting this Liga Feral Flying Pig I picked up a few weeks back. Any recommendations on where to grab a great latte? I’m staying near Back Bay Station.