Food Stamps Apology
I apologize for an error in my original post.
I messed up the work on tax brackets. Her taxes on $45,410 would now be $6214, but her $52,440 would be taxed as $7962.50.
Here’s what I messed up: the first $11950 is taxed 10%, your money after that up to $45,500 is taxed 15%, and finally her remaining money is taxed at 25%. This makes much better sense and changes the outcome significantly.
After 15 years (rather than 6) she will surpass her other tax contribution. If we pretend she starts her master’s program as late as 35 years old, she pays it off (tax-wise) by 50, then for 15 more years she is providing more taxes. $213,158 vs $186,420 or 2.73 times the amount she borrowed.
So, I apologize again. You might be able to argue that 15 years is too long to wait.
