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Help! I Owe $150K in Student Loans and Make $36K a Year

Money problems can be distressing and depressing. We recently heard from a college graduate who feels overwhelmed by debt :

What can I do about student loans? I owe about $150,000 and only make $36,000. I’m also looking for a new job that hopefully pays more. I feel stuck and miserable. I went to college to better myself but instead of feeling improved, I have this huge burden on my shoulders. All I do is work and pay bills, work and pay bills, work and pay bills. Help me, please!

We asked finance expert and writer (and contributor for Mitchell Weiss about our reader’s plight. Unfortunately the news wasn’t encouraging.

The writer may be entitled to some government-backed repayment plans. such as income-based repayment (IBR) or Pay As You Earn (PAYE) programs. But, Weiss cautioned, those are available only for federal loans; they are not available for private loans. If he works in the public domain, our reader might be eligible for the Public Service Loan Forgiveness Program.

“As far as his/her private loans are concerned, it’ll be case by case with the lenders,” Weiss said in an email. “Just know that any accommodation will come at a price — unpaid interest will be added to the loan balance (this is known as ‘negative amortization’), which will only make matters worse.”

Check Credit Before Paying Down Student Loans Get your free Credit Score & personalized Action Plan. See where you stand & learn ways to better manage your score before paying down your student loans. Free and updated every 30 days.

And although our reader didn’t ask, anyone who co-signed a loan for him may also be affected by his predicament.

So, unfortunately, this serves mainly as a cautionary tale. Going through college debt-free would be ideal — dipping into money set aside for college or finding scholarships

— but if that’s not possible, federal student loans can be a sensible choice. At least there are options if you are laid off, take a low-paying job and the like.

While exploring career options, students should be aware of what a typical first-year salary in their chosen field would be. That number is a good guide to the maximum loan amount for college — because unmanageable student debt is financial quicksand.

If you opt for a repayment program or other special payment arrangements for your student loan debt, you can track how it affects your credit by monitoring your credit scores.  You can monitor your credit scores for free with a account, and get a personalized plan to build your credit.

More on Student Loans:

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Gerri Detweiler is's Director of Consumer Education. She focuses on helping people understand their credit and debt, and writes about those issues, as well as financial legislation, budgeting, debt recovery and savings strategies. She is also the co-author of Debt Collection Answers: How to Use Debt Collection Laws to Protect Your Rights . and Reduce Stress: Real-Life Solutions for Solving Your Credit Crisis as well as host of More by Gerri Detweiler

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Category: Credit

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