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Both health insurance payments and student loan payments go to zero as income goes to zero. So what's the problem? If you find yourself with no income you will
by zaroth 9y ago
Both health insurance payments and student loan payments go to zero as income goes to zero. So what's the problem? If you find yourself with no income you will also find yourself with no monthly payment on your loan and free health insurance.
- mdorazio 9y agoI think you're assuming that people have enough money saved to start a small business with zero income for an extended period of time, which I highly doubt is a common case. And what about the employees you have to pay enough to cover those things for?
- zaroth 9y agoNot at all -- I would not expect someone without savings to work for nothing at a startup, or try to start their own startup without outside funding and a salary. But it's important to recognize that both health insurance and Federal student loans have programs in place to support people who have no income.
- lovich 9y agoStudent loan payments do not go to zero as your income goes to zero. You still accrue interest if you aren't making oayments. Additionally if you have any sort of cosigner, which is not uncommon, then the banks go after your family for those loans if you cannot pay. I know I have turned down risky startuo jobs because my parents credit would have been hit had I been unable to make payments
- zaroth 9y agoGood points -- interest still accrues, and some loans are private and you don't get access to all the pay-as-you-earn and income-based/income-driven repayment options. But for Federal loans with IDR, you absolutely can get a $0 monthly payment without any impact to your credit score, and this is not at all uncommon.
- lovich 9y agoCorrect, but as long as a significant portion of loans don't have that option it stands to reason that it would put a downward pressure on the number of people who felt they could start a new business