Pete:
I know this is a long and confusing question, but frankly, I’m confused. And I’m wondering if you can shed some light on this. Thanks again for all your help. I appreciate everything you do.
Plus it simply so happens that people money that you got to own med university was basically 
these types of nearest and dearest, government knowledge funds, that weren’t entitled to public service financing forgiveness
Dr. Jim Dahle:
Do we know about this, Andrew? Yes. We know about this. We’ve been talking about this for months.
Also it just very happens that people money which you had to have med school were these types of relatives, government studies money, that weren’t eligible for public service mortgage forgiveness
Dr. Jim Dahle:
Yeah. So, give him the answer. What’s the scoop on this new PSLF waiver that goes through Halloween?
Andrew:
Yeah. Recently, this came out on e out and what this has done is it’s shaken up a lot of the world for public service loan forgiveness. And the reason why they’ve been able to do that is, in the event of a national emergency or war, essentially, the legislators can change up student loan law, albeit temporarily, which COVID has fit within that realm.
Andrew:
And so, essentially the payments that you have made, any payment, as long as you have qualifying employment should qualify. And you detailed one of the key steps is doing a direct federal consolidation. Because in the old rules, when you completed a consolidation, what it did is it erased all of your prior payment history. And we have run into this time and time again with so many clients that like you graduated med school in the 1990s or early 2000s.
Andrew:
Essentially, you got the short end of the stick, just because you borrowed before 2007, 2010, when a lot of the newer loans, these direct federal student loans, were starting to get issued.
In short, sure, the next step is to try to over an immediate federal consolidation. Just after you to experiences, following during that application, you will need to pick a repayment package, but I’m whenever you already produced the new 120 money. You don’t have to make far more payments then it is possible to must approve the work, use a jobs qualification function, immediately after which several a whole lot more months to go, and then you will be able to have the instantaneous tax-totally free financing forgiveness.
And it just thus happens that those financing which you had for med school had been these family members, government degree funds, and these weren’t qualified to receive public-service financing forgiveness
Dr. Jim Dahle:
Yeah, it’s awesome. It’s basically been expanded this year. Even people that didn’t meet the requirements in the program, when the program was introduced, it just got a whole lot more lenient. And that was actually president Biden taking advantage of the COVID emergency to put some emergency rules in place. Take advantage if you can.
And it also simply very happens that people fund which you had for med college had been these family, federal knowledge funds, and they just weren’t eligible for public service financing forgiveness
Dr. Jim Dahle:
All right. Our next question is from email, it’s actually a two-part question. The doc introduces it. “I’m an academic physician about two and a half years out from training, definitely pursuing PSLF with about 100 qualified payments to date.”
And it just thus goes that those financing you got having med college was this type of members of the family, federal knowledge fund, and they were not eligible for public service loan forgiveness
Dr. Jim Dahle:
He has two questions. The first one, “In addition to funding retirement and a six-month emergency fund, I’ve been saving a PSLF side fund in a high yield savings account. My PSLF side fund will equal my med school debt burden, which is now $325,000 with over $120,000 in interest on top of $200,000 in principle.
Therefore merely thus happens that people fund that you got to have med college have been this type of nearest and dearest, government training funds, that were not qualified to receive public service financing forgiveness
Dr. Jim Dahle:
I anticipate that at that time, my attending level monthly payments will be large enough to finally cover the accruing interest and that my debt won’t grow meaningfully in my final year, year and a half of qualified payments.
Also it only thus happens that people finance which you got for med college or university had been this type of nearest and dearest, federal degree finance, that were not eligible for public service mortgage forgiveness
Dr. Jim Dahle:
What do you recommend I do with the side fund during that time? I know a high yield savings account is the most risk-averse option. Do I just leave it there earning less than 1%? The rest of my personal investments are in low-cost index funds. When would you start adding some of those PSLF side fund monies into index funds too?” Why don’t you give your take on this Andrew, and then I’ll give mine?
