Don't forget to figure in loan fees, aka the money you pay just to borrow the money in the first place.
Yes, there is a loan fee on all Direct PLUS Loans. The loan fee is a percentage of the loan amount and is proportionately deducted from each loan disbursement. The percentage varies depending on when the loan is first disbursed, as shown in the chart below. Loan Fees for Direct PLUS Loans First Disbursement Date Loan Fee On or after Oct. 1, 2015, and before Oct. 1, 2016 4.272% On or after Oct. 1, 2016, and before Oct. 1, 2017 4.276%
Aka my $30k Grad PLUS loan costs $1,300 just to borrow.
The whole reason I started this thread was because one of my classmates mentioned that she was making interest payments and was going to deduct them on her taxes, however, @loliz made this point:
Which pretty much answered my question.
Though, it does make sense to pay off the interest while you are in school, if you can, as it will capitalize when you enter repayment and allllll of that unpaid interest will be added onto your principal. That's when you start paying interest on interest. Thank you US Gov!