May 1, 2025 - Freedomain Radio - Stefan Molyneux
06:53
| 
| Time | Text |
|---|---|
| Interesting. | |
| Blindluck posted, it baffles my mind that after 42 months of interest-free extensions, 5.3 million people are in default on their student loans. | |
| Yeah. | |
| A woman named Emily Logan Stedman wrote this. | |
| She said, I borrowed $128,606.84. | |
| I've paid... | |
| $97,858.26. | |
| I still owe $100,482.57. | |
| She says, I wouldn't trade in my law degree. | |
| I left law school. | |
| I'm fortunate to have almost always had a job that allows me to make the max required payment. | |
| Clerking did not allow that. | |
| But still, come on! | |
| Those numbers are really kind of shocking for me. | |
| That you can pay almost $100,000 on $128,000 and still owe $100,000. | |
| Holy crap. | |
| Why pay off? | |
| I don't know. | |
| I think it's very cool. | |
| I'm still quite fascinated by AI. Bye. | |
| Bye. Bye. | |
| *lots of music* Thank you. | |
| Interest accrual outpacing principal reduction. | |
| Yeah. | |
| Yeah. | |
| 6% interest rate. | |
| At 6%, the annual interest on 128,000 is 7,700. | |
| Yeah. | |
| Yeah. | |
| So about 28,000 of our payments have gone towards the principal. | |
| the remaining almost 70,000 have gone towards interest. | |
| yeah. | |
| Federal student loans can take 10 to 25 years to pay off. | |
| A standard 10-year plan for Emily's loan at 6% interest would require monthly payments of about $1,400. | |
| Over 10 years, she'd pay about $171,000 with $42,000 and change going to interest. | |
| Yeah. | |
| Yeah, it's wild. | |
| I'm a big fan. | |
| If you're in debt, it's not financial advice to you. | |
| I'm just saying, if I'm in debt, when I've been in debt, I will sell a kidney to put more down on the principal. | |
| Because it's magic. | |
| Absolute magic. | |
| Absolute magic. | |
| Now, if that's the max required payment, then she's not allowed to put down more money on the principal. | |
| I assume that's what she's saying, right? | |
| that there's a maximum payment that you can do? | |
| But yeah, that's some pretty wild stuff. | |
| So, initial loan amount, $128,600. | |
| Total payments made, $97,858. | |
| Remaining balance, $100,000. | |
| Payments are monthly fixed. | |
| There are no extra payments or changes in terms. | |
| Yeah, like there's some mortgages that let you pay 13 months in a year. | |
| The extra month goes straight on the principal. | |
| Huge difference, right? | |
| Paying down the principal is economic superpower. | |
| It's wild how much it saves you. | |
| Hmm. Okay. | |
| Wow, some pretty intense math going on here. | |
| Come on, I grok me Amadeus. | |
| Oof. | |
| So, I think what she said, so the grok worked it out. | |
| Initial loan amount, 128,606. | |
| Interest rate, 6.7% annual. | |
| Monthly payments, 906. | |
| Payments made, 108 months or 9 years. | |
| Total term, 282 months or 23.5 years. | |
| Yeah. | |
| And I assume that that's the maximum. | |
| So she's been paying for nine years. | |
| It's about 14 and a half years left. | |
| The 6.7% rate is consistent with federal graduate loan rates from the early 2010s. | |
| Rate could vary slightly. | |
| Yikes. | |
| That's kind of terrifying. | |
| Now, of course, putting women in particular, men too, right? | |
| But putting women in particular... | |
| Getting into debt is a great way of killing the birthright. | |
| It's a fantastic way to kill the birthright. | |
| You can't quit! | |
| You can't quit. | |
| Or if you do have kids, you've got to hand them over to the daycare, the state, whoever, right? | |
| That's really something. | |
| Crush your monthly expenses. | |
| James says, I paid off my student loans early when I could. | |
| Not sure what she means with a maximum payment. | |
| I don't know. | |
| But I mean, I think we know what she means by a maximum payment. | |
| It means that you're on this treadmill forever. | |
| I mean, when I was dating, I avoided women with debt. | |
| I mean, I don't know if that's even possible anymore. | |
| But I would avoid... | |
| I would avoid women in debt. | |
| I just did not want that burden. | |
| I did not want that burden. | |
| And it's one thing to be in debt for something that's going to grow in value. | |
| You know, if you go in debt for maybe a house or whatever, right? | |
| Something that's going to hopefully gain in value, go in debt to buy Bitcoin if that's what you did. | |
| But... | |
| Yeah, James, can you look that up if there are some loans that you have a maximum payment and you just can't pay more? | |
| Like, you can. | |
| Like, they're designed to lock you in for a quarter century. | |
| That's rough, man. | |
| That's brutal. | |
| Oh, and please don't forget, speaking of finances, freedomain.com slash donate. | |
| I really would appreciate your help. | |
| freedomain.com slash donate. | |
| I am committed to doing better shows. | |
| I apologize for the last couple of weeks. | |
| I am returning to my native roots. | |
| We'll get there. |
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