Married with Student Loan Debt

I married a man with a big student loan debt.
Our Beliefs
Before we were married, my husband and I talked a lot about money. And we have similar values. We believe we should:

• live within our means,
• not borrow unless we have to, and
• not buy things until we have they money for it.

We have lived these values since we’ve been married, with one exception, which I will discuss below.
Our Money Going Into Marriage
Before we were married, I purchased a house, so we have our mortgage. I also had a car payment. He purchased his last car outright and has been trying to save for the next car he’ll need–hopefully many years from now–since then.
We also paid for our wedding outright and had an affordable honeymoon.
For our first few years of begin married, I paid my car loan down, and when it was close to paid off, he was the one who suggested we pay it off early with our shared money. And we did.
Monster Debt
Now, before we were married, my husband and his ex. racked up a bunch of student loan debt. They were both in college and raising 3 children. Before he married for the first time, my husband went to 3 or 4 different colleges, struggling to find connection to place or people. And though he had been in the service, US Army, he quickly lost the funds he received for the GI bill because he failed so many classes at different colleges.
Hence, my hubby and his ex racked up a good amount of debt. I have no idea how much debt his ex. had (or has), but he left the relationship with over $100K student loan debt.
I was somewhat nervous with this, but my husband was paying back the loan and assured me I was not going to have to pay any of it.
That is true today. I have not paid a dime of my husband’s student loan debt.
The Problem
“What’s the problem then?” you might ask. Read on, Dear Reader, and I will share.
A few years into our marriage, my husband wanted to go back to school for a PhD. It was his dream. He had a bachelors, a masters, and we both had stable jobs. He knew he’d have to take out some more student loans, but somehow, it was going to be ok.
He took out more loans, got his PhD– Yay!–and the debt just about doubled–Boo!
I really had no idea that he’d have to take out that much. I left it to him to deal with.
Debt Repayment
It is a few years later and he has been repaying the debt. He is on the Income Based Repayment plan. Navient dictates how much he owes per month (based on his income), and as long as he continues to pay and enroll in the program each year, what is left on the loan at in time will be forgiven.
This seems like a good plan.. except that he has to do this for 20 years. Twenty years!
Forgiveness with Strings Attached
Plus, after I have done some research, I find that the year the loan is forgiven, we have to claim the amount forgiven in our taxes as income and we will owe tax on that. Because the amount we owe is so high, because we have to pay a reasonable amount (based on salary), and because interest keeps accruing, by that time, the loan will be astronomical (if we continue to pay the amount Navient dictates and no more).
Upon additional research, I am learning that some people have to take out a loan to pay the taxes on the loan forgiveness. Unless we save maybe 100K for that purpose, we may be in the same situation.
Responsibility and Feelings
It has been a tough pill to swallow, but I now take responsibility for not looking closer at the debt in the early years. I also don’t want to take responsibility off my husband for taking out the loans. (I do have a ton of compassion for him, though, because he’s not as money-minded as I am).
We are doing what we can to pay these back. I cannot help but have fear surrounding the span of time we will have the loan and the amount it will become before forgiven. I also worry about whether or not it will be forgiven; if laws change, the program could change. I worry about paying the taxes on the forgiven portion.
I do fault the student loan system to a degree, though, for this terrible mess we are in. I don’t think that the money for a PhD should have been lent to my husband. I believe it should be more clear that the loan forgiveness would be taxed. There are a variety of concerns and frustrations I have with Navient, the doctoral school my husband attended, etc.
Where We Go From Here
We have a lot of decisions to make and we will definitely seek advice.
I am grateful, though, to have collected the information I have so that we can make good decisions regarding the loan as we move forward.
I plan to chronicle our decision-making process, provide details of the loans, etc. on this blog in hopes that it will support us in getting out of the debt and that it will possibly help others in a similar situation.
~Julie