How we paid off almost $47,000 of our $80,000 student loan debt in three and a half years, plus the best personal finance tips to help you get out of debt too! If you’re paying off debt, then you’re in the right place!
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It’s time for another student loan payoff update! These monthly updates are where I share our progress as we work toward a debt-free lifestyle.
If you’re new around here, let me fill you in on our particular student loan situation. If you’ve been here before, feel free to skip this section.
Our Student Loan Story
I graduated from college without any student loan debt. My cosmetology diploma, associate’s degree in business administration, and bachelor’s degree in business administration all came from affordable schools. I even took most of my classes online, so I didn’t have to pay for expensive student housing!
My debt-free education was a blessing since Josh had enough student loan debt for the both of us. Growing up, he didn’t have the same support system I had. He didn’t have anyone there to help him pick an affordable school, so he ended up at a very expensive for-profit university.
Don’t get me wrong. We’re very grateful for his education. His bachelor’s degree is in computer information systems, so he was able to get a good job one month after graduating. But that education came with a hefty price tag, one that he wasn’t fully aware of when he signed up.
The Grand Total
In all, he ended up with $75,000-$80,000 in student loan debt. We aren’t sure what the exact amount was because he had been making payments toward the private student loan before we got married. I didn’t keep track of his payments back then, and he doesn’t know how much he paid from March 2014 to August 2014.
When we got married that September, I began paying the bills and keeping meticulous payment records. That month, we paid off the remaining $11,000 private student loan out of our savings account and focused all of our energy on the federal loan, which totaled $64,000.
It’s kind of cool to see how much we’ve been able to pay from year to year. Here’s what our payments in 2014, 2015, 2016, and 2017 looked like:
So let’s talk about our most recent payment!
When I made March’s payment, the student loan balance was $38,415.40.
I made a payment of $780, which brought the balance to around $37,635.40. This is just an approximation since the loan still accrues interest during the few days it takes for our payment to process.
It’s hard to believe that we’ve paid nearly $47,000 toward Josh’s student loan debt in just three and a half years!
Thoughts on March
March was another good month for us. We actually paid almost $100 more on the loan than I originally expected back when I made March’s budget! Our electric bill was a lot lower than I planned for, and even though we took a long weekend trip to the beach for Easter, we still spent about $20 less on gas than I expected. That extra money went straight to the loan.
I love months like that. 🙂
How We Made It This Far
Our journey to a debt-free lifestyle hasn’t been easy. And it hasn’t been quick either. Since we’re a single-income household, it isn’t realistic for us to think that we can pay off all of our debt in an insanely short time frame like some people can.
Still, we’re doing everything we can to pay off this student loan debt as quickly as possible. Here are the things we’ve been doing consistently to make it this far:
Learn how to manage our money from experts such as Dave Ramsey
Without a basic understanding of personal finance, we wouldn’t stand a chance against this student loan debt. We’d be just like everyone else, struggling to make the minimum monthly payment while blowing the rest of our money on stupid stuff. It’s a vicious cycle! We’d be so lost without Dave Ramsey.
(Dave Ramsey’s book The Total Money Makeover is an excellent place to start if you want to live a debt-free lifestyle too!)
Make a budget each and every month
I learned a long time ago (from Dave Ramsey!) that you have to tell your money where to go or else it will disappear. And it’s true! Before I started making a budget, I had no idea how much money I wasted at the grocery store or at restaurants. Now, we decide up front how much money we want to spend each month on things such as groceries, clothes, or entertainment. This keeps us from accidentally spending the money that should go toward the student loan.
Switch to the cash envelope system to curb our spending
Hands down, this was the biggest game changer for us. Even when we had a budget, we still overspent on a regular basis. Why? Because paying for things with our cards meant we couldn’t tell when we reached our budget limit for each category!
Now, I can easily tell how much money we have left for groceries or eating out at restaurants just by looking in the envelope for that particular budget category. And since we pay for things with cash, we’re forced to stop spending when the money is gone! Easy peasy.
Save for emergencies
Having an emergency fund is SO IMPORTANT! We’ve had several expenses crop up that would have easily put us into more debt if we didn’t have our emergency fund to cushion the blow. At the very top of my list is a new air conditioner that cost us $6,500 last July. I don’t even want to think about the amount of stress I would have felt without that emergency fund!
Related: 4 Reasons You Need an Emergency Fund
Find new ways to save money so we can keep our expenses as low as possible
I’m frugal by nature. It’s almost like a game for me, trying to see how much I can get for as little money as possible. I’m always on the hunt for new ways to save money, and I’m pretty sure this is how we’re able to make decent student loan payments on one income.
Related: 6 Tips to Score Big at Thrift Stores
Treat ourselves to inexpensive beach trips so we don’t feel deprived
We’re beach people. If we couldn’t go to the beach, we’d go crazy! To keep us from feeling absolutely deprived, we make sure to plan for little getaways about once per month. These aren’t expensive trips. Sometimes we take a day trip, and other times we spend a night or two at an oceanfront campground. These options are way more affordable than staying in a hotel, B&B, or beach house!
These six habits keep us laser-focused on our end goal of being debt-free. We still have a long way to go, but we’ve certainly made significant progress over the last few years!
Wrapping It Up
And that’s another student loan update for the books! I’m quite pleased with our progress, especially since we’re inching closer to the $35,000 mark. Each time we reach a new milestone, even a small one, a fresh wave of determination carries me to the next milestone.
Other Posts You May Enjoy
- How to Spend Less Money When Your Spending is Out of Control
- How to Know Which Financial Advice to Follow
- The Biggest Mistake I Ever Made Trying to Save Money
- 7 Free or Cheap Ways to Exercise on a Budget
- The Best Financial Advice I Ever Received
What about you? Are you trying to pay off your student loan debt early? I’d love to read about your progress in the comments!
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