How a 40-Year-Old Got $222,000 of Student Loans Forgiven Through PSLF

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• Robert Metzger, Jr. got $222,000 worth of student loans forgiven through PSLF.
• He got on an income-driven repayment plan as soon as possible, even while he was still in grad school.
• He paid as little as possible by using tax breaks on charitable donations and pre-tax paycheck deductions.

Robert Metzger, Jr., physical therapist and host of faith-based financial literacy podcast “Family Abide,” found himself in six-figure student loan debt after finishing his graduate studies at Emory University in 2013.

Nearly a decade later, his loans have been forgiven thanks to the Public Service Loan Forgiveness Program, and he kept his payments down along the way.

Metzger tells Insider, “Emory is actually the first place I learned about the Public Service Loan Forgiveness Program,” a student-loan forgiveness program specifically for public servants who work for nonprofit, government, or tribal organizations. PSLF forgives the student loans of public servants after 120 eligible payments, roughly 10 years.

With that knowledge, Metzger, now 40, intentionally sought out work in the nonprofit sector. In the meantime, he was determined to pay as little as possible on his loans throughout those 10 years. He immediately enrolled in an income-driven repayment (IDR) plan while we was still in college, which made his first year of qualifying payments $0 a month.

As he made more money working for a nonprofit hospital, his payments increased to $413 per month in 2015, and $956 per month in 2020 before the pandemic payment pause. “During those 10 years, I paid $55,000 to $60,000 and none of that touched the principal balance,” he says.

His gamble paid off. According to records reviewed by Insider, Metzger received $221,804 in student-loan forgiveness through PSLF. (There is currently a limited-time waiver in effect to help more public servants reach PSLF. The waiver expires October 31. You can apply at this link.)

Here are the two tax strategies he used to pay as little as possible toward his student loans.

1. He donated $22,000 to charity in 2021

IDR plans are calculated using the annual gross income (AGI) listed on your tax return. Metzger realized that lowering his AGI as much as possible would also lead to lower monthly student loan payments.

By itemizing his deductions, instead of taking the standard deduction, he was able to lower his AGI by $22,015 by donating to charity.

He adds, “We pay our tithes,” 10% of gross annual income given directly to one’s church, “on credit cards so that we can get the reward points. We do not go into debt for our tithes, but it’s paid every paycheck on auto-pay; 1% to 2% cash back on $30,000 adds up.”

2. Metzger used his FSA and retirement contributions to lower his AGI even more

To lower his AGI even more, Metzger contributed as much as possible to his flexible spending account (FSA). Similar to a health savings account (HSA), an FSA is an account where you can keep pre-tax money from your paycheck specifically for medical expenses.

Those pre-tax contributions lower your AGI. Accountant Akeiva Ellis says, “FSA contributions are not included in your W-2 income, which flows through your AGI. For example, if your gross salary is $50,000 and you contribute $1,000 to FSA, only $49,000 of your income will come through on your W-2.” Metzger and his wife, Charity Metzger, contributed a total of $7,800 to regular and dependent care FSAs to lower their AGI.

Retirement contributions work to lower AGI in a similar way.  The Metzgers also contribute a total of $14,000 a year to their retirement accounts to lower their AGI, and, in turn, get lower monthly student loan payments.

It’s worth noting that lowering your AGI in this way is not always beneficial. Financial planner Jay Zigmont, founder of Childfree Wealth, says that if you’re applying for a mortgage or other loan, a lower AGI on your tax return might qualify you for a lower loan amount.

“Another downside is that you may not have enough money to pay your bills, and you will have to pay taxes at a later date on everything that you put away pre-tax,” he says.