In 2018 I finally crushed my student loan repayment goal. Everyone is going to have their own set of financial circumstances and their own student loan goals. Below I talk about what it took for me to meet my goal and pay almost $44,000 toward my student loan debt last year.
Estimated read time ~7 minutes, estimated watch time at 1.5x ~5 minutes.
Last week I shared my 2018 student loan repayment progress, you can check that post out here.
A Very Specific Repayment Goal
At the beginning of 2018 I was coming off a disappointing year of repayment. In 2017 I paid <$24,000 on my student loans and was really disappointed in myself. I set a very specific goal, that I would pay at least $3,000 a month, each month, toward my student loans for a total of $36,000 in 2018.
The End Was in Sight
2018 was the first year that I really felt like I could see the end of my student loan repayment path. With just about half of my original $132,000 balance remaining to start off the year I could visualize being debt free.
Imagining myself being free of the weight of my student loans gave me the motivation to make small sacrifices and stick to my repayment goal each month. For me, knowing that I wouldn’t have to sacrifice for much longer made it easier to pay extra now.
All Extra Money Toward Loans
I knew one of the things that would help me meet my goal and then some would be to put all my extra money toward my student loans. That meant every time I picked up an extra shift at work, or got an influx of extra money, I put it all toward my student loans.
Last year was the first time I put an entire tax return toward my student loans, and that sucked to be honest because I wanted to spend it on something fun. But I knew it was getting to my #debtfreedream just a little bit faster.
Sometimes I would have pretty small amounts of extra money to put toward my student loans, maybe only $100. In the past I used to think that money was too small to matter much, after all it’s less than 1/10th of my minimum monthly payment. This year, I decided all amounts of extra money helped.
Gave Up Some Things
Typically I take one big vacation with my fiance every year. Unfortunately 2018 was a year of PTO denial and we couldn’t get any time off together to take our planned trip. That meant we didn’t have a big vacation and I ended up putting the money I would’ve spent on that toward my student loans.
In 2017 I spent thousands of dollars removing a couple of trees and fencing in the yard for my dog. But in 2018 I didn’t have any big expenses like that. Our couch is getting worn out, I can’t get the dishwasher open, and I cracked the plastic housing of my car’s side mirror, but I’m pushing those expenses off until they’re really necessary so I can keep plugging away toward my goal.
Tracked my Progress
What gets measured gets done. It’s very simple, so this year I tracked my progress and celebrated milestones. I paid off $100,000 in principal this year and took the time to take notice of that fact and celebrate it. I also tracked my monthly & quarterly progress to make sure I was where I wanted to be.
Started a New Job
Another huge reason I overachieved my student loan repayment goal was the fact that I started a new job. In September I was offered a position at Tuition.io, a student loan repayment benefit company, in Silicon Valley.
I’m still a licensed pharmacist, working on-call at the hospital a few shifts here and there. But now my full-time job is to help employers solve their staffing concerns by solving student loan debt problem for their employees. It’s a pretty awesome thing to do. I work remotely from Wisconsin so my cost of living expenses didn’t skyrocket.
Starting a new job wouldn’t necessarily help me pay off my student loans faster. In my case it did because I hadn’t been able to use a significant amount of my PTO for about a year at the hospital. That meant I had banked 290 hours of PTO. When I dropped down to on-call status from full-time those hours were cashed out.
Even though that money was taxed way more than I could have guessed, it still left me over $9,000 to split between saving up for my wedding and paying extra on my student loans. The PTO cash also really helped me prevent the situation where funding my wedding ate into my ability to pay down my student loans. Because with that lump sum and a little extra savings I’ve funded my half of the wedding, assuming I can stick to my budget!
My new employer is a student loan repayment benefit company. That means they contribute $100 a month directly toward my student loans. So while I’ve only gotten three months of that benefit, every little bit helps!
Those are all the things that really worked in my favor in 2018 to help me really tackle my student loan debt. I feel very grateful about all of it, and most of all very grateful that I’m almost done paying back my student loan debt.
I love hearing from my fellow repayers. So I want to know, what helped you reach your student loan repayment goals in 2018? Leave me a comment below or on the Repayable Facebook Page. See you next week!
Happy New Year everyone! Thank you all so much for stopping by to read the blog, commenting on my YouTube videos, and messaging me with your student loan questions. Repaying student loan debt is a long journey and it’s better with awesome folks like you along for the trip.
In today’s post I give a review of my student loan debt progress compared to the goal I set for myself. This is the first year, in all my years of repaying my student loans, that I crushed my repayment goal completely. Estimated read time ~5 minutes, estimated watch time at 1.5x ~4 minutes.
My 2018 Student Loan Debt Goal
Let’s refresh by talking about what I set out to accomplish with student loan repayment in 2018.
My goal was to pay $3,000 per month toward my student loans for a total of $36,000 for the year.
It was an ambitious goal but within reach.
I want to be clear, the specific number of this goal is right for me but might not be right for you. Don’t judge yourself or your student loan repayment goals against mine. Each person has different competing financial needs and income. The number only matters in context to my personal goal. My repayment goal doesn’t determine the value of your repayment goal.
The Start of 2018
At the beginning of 2018 I reflected on my 2017 progress and I was pretty disappointed. I hadn’t been nearly as aggressive as I had hoped. Looking back at my 2017 progress was a good reality check for me. In 2017 I put $23,600 toward my student loans. Not the worst, but really not very good either.
I started 2018 with a total student loan balance of $64,672.61 or about half of my original $132,000 balance.
2018 Student Loan Repayment Progress
2018 was a very successful year for my student loan repayment.
I paid $43,925 toward my student loans and my student loan balance as of Jan 1 2019 is $22,341.69
Ahhh!!! I’m almost out of student loan debt you guys!
2019 Student Loan Repayment Goal
2019 is going to be the year I pay off my student loans completely. One of the biggest things that’s helped me pay so much extra this year is that I can see how close I am to being out of debt. I’ve decided I want to be out of student loan debt before I turn 30.
To make that happen I’m going to pay at least $3,500 each month toward my student loans. That should mean I’ve repayed my student loans completely in July of 2019! Just 7 more months of student loan debt.
2019 is going to be a bit more challenging for me financially because I have a major competing financial interest, I’m getting married in October. My fiance and I are splitting the cost of the wedding and I already have my half saved, assuming I can stick to my budget. I don’t have anything saved for the honeymoon but I’m hoping I can use what I had been paying on my student loans every month to come up with the funds for my half of a really nice trip!
How was your 2018?
I love hearing from other borrowers working to repay their student loans. I’d love it if you could share how repayment went for you in 2018 and what your goal is for 2019. Leave me a comment below or on the Repayable Facebook Page or drop me a message, I’m jeni@repayable.org. Here’s to a 2019 that brings you closer to your #debtfreedream
Yes, this post is hard core cheesin’ being posted right before Thanksgiving. But it’s not some trite gratitude post minimizing the struggles borrowers face. Rather it’s a post about how sometimes struggles, and successfully navigating those struggles, are all about perspective.
This year for the first time, I’m genuinely grateful for my student loan debt. Read on to for what I think my student loan debt has given me. Estimated read time ~4 minutes. Estimated watch time ~ 3 min at 1.5 x speed.
Strong Work Ethic
Like the many of you reading this right now, I sacrificed through college. I worked two jobs and more than full-time every summer, winter, holiday, and spring break. If I had a chance to earn money, I did it to minimize the amount of student loans I had to take out. I did this at the same time I studied and improved my GPA during pharmacy school. I really never viewed anything else as an option.
That work ethic developed and was tested throughout my education, residency, and later as I started a side hustle while working full-time as a clinical pharmacist. Without the constant need for work and crucial impact that made on my mindset, Repayable wouldn’t exist today.
Financial Pressure
$132,000 in student loan debt put a strain on my finances. This amount of debt forced me to make a decision about how I wanted my relationship with money to go. I could choose to follow vague ideas about what to do with money, or I could find a better way on my own.
The financial pressure of my situation helped me set clear boundaries on spending and develop meticulous habits when it came to managing my personal finances. I realized quickly what I valued and what my money could do for me. Then I rigorously cut the extra fluff out.
Something to Fight Against
Most people would try to frame this in the positive, something to fight for. But for me student loan debt serves as more of a villain, something to be defeated.
I like the idea of resistance and striving against something. Villains unleash great motivation and power within me. I tap into a part of myself that’s often sleepy in every day life, I think perhaps the thing I tap into is resilience and the strong desire to be successful in spite of something difficult.
Empathy
I worked hard, sacrificed, and still ended up with a lot of student loan debt. I often get criticized for the amount of debt by folks who have no clue. I’ve suffered feelings of defeat, hopelessness, and lack of progress.
While I certainly haven’t lived anyone else’s story I understand how anyone can end up in a bad situation and feel stuck. I’m not here to judge other people’s choices, I’m here to help them make the right choices for their own goals.
In the end my student loan debt has reinforced a strong work ethic, focused my money habits, strengthened my resilience, and given me empathy toward my fellow human beings. Not bad for something that seemed like it may crush me and hold me back from my full potential.
Sometimes it feels like you’re supposed to “do it all”. When you’re in college you should be, studying, working, volunteering, interning, dating, partying, and laying the foundation for future you. Then you graduate and the next list of shoulds starts in. You should find a good job, work your way up, put in your dues, become an adult, travel, live your life, make friends, get married, buy a house… the list never ends.
But the thing that everyone seems to miss is that some of those goals contradict each other, some of those goals aren’t even your goals, just a list of someone else’s “shoulds”. I say it’s time to forget the “shoulds” and pursue your own goals. Because there’s something that’s going to limit you, and it’s money. Plain and simple, when you finish college with student loan debt, your cashflow is going to be a rate limiting step. And you don’t have enough money to waste it on someone else’s “shoulds” you’ve got enough money to chase down and achieve your goals.
So how do you accomplish your goals with the weight of student loan debt on your back? You set crystal clear priorities and you stick to them. Estimated read time ~ 5 min, estimated watch time at 1.5x ~3.5 min.
Set goals and prioritize them.
Paying back student loan debt is hard, it’s harder for some than it is for others. The more debt you have, the lower your income, and the higher the cost of living, the harder it is to pay back your student loans. That’s why you have to decide what goals you want to accomplish, not what someone else wants for you, or what you think you should do, but what you actually want for yourself.
Start by asking yourself what the most important things are that you want to achieve right now. Write down a list of your ambitions and think about them. Get rid of anything that’s not your personal goal but comes from an external source.
Tip: If you’re not sure if a goal is yours or external look at the language you use when thinking or talking about the goal. If you’re saying the word “should” a lot, you probably don’t want to do this right now.
Maybe someday a “should” goal will change to something you truly want, but that day isn’t today so that goal doesn’t make the cut. Ruthlessly pare down your list until you get a few core goals.
An example list may look like this:
See new places by traveling
Expand my career, build and use new skills
Build financial independence and positive net worth
Establish the necessary first steps.
What are the very basic first steps you need to take? This is where you’re going to learn how much it really costs you to work on each goal. Remember, some goals are going to cost you money, but career goals can generate income, so it’s not necessarily all negative cash flow.
Look at your financial situation honestly.
Many goals require money; travel, financial independence, buying a home, etc. It’s impossible to make the right decisions to fund these goals unless you understand your financial situation clearly. That means you need to look at your student loan debt, figure out how much that costs you each month, and decide if that repayment strategy is right for you.
Once you’re on track with the student loan side of things it’s time to assign funds to your most important goals. You only have so much money to leverage at the end of the day. Think about that carefully when setting savings and investing goals.
For folks with an employer-sponsored retirement fund that has a matching contribution I always encourage you to find a way to get the maximum employer match. By doing that, you’re effectively increasing your pay, although you can’t use that money today. After that, additional contributions are up to you and can be flexible based on your other goals.
What can you get rid of in your life?
Getting rid of stuff isn’t everyone’s cup of tea, but hear me out. You can’t have it all financially, at least not right away. By cutting out things that matter less to you, you can free up money to meet your important goals. Maybe you moved to a city and still have a car that you don’t really need. So you get rid of the car, the car payment, the insurance payment, and opt for public transportation. It’s a sacrifice, but maybe it means you can take one extra trip each year, or pay off your student loans 2 years faster.
Setting priorities and sticking to them is hard. It can be disappointing to realize after a long time spent sacrificing in college, that you can’t have it all and still have a season of sacrifice in front of you. Your financial sacrifice is most intense as you start out, but with careful planning and goal setting you can lessen that intensity over time and achieve your goals.
I want to know what sacrifices you’ve had to make in pursuit of the goals that are most important to you. Leave me a comment below or on the Repayable Facebook Page.
When you have six figures of student loan debt it can feel like you’re never going to get out. Well, at least that’s my experience carrying that kind of debt. But now that I’ve been repaying my debt for about four years, I’ve finally paid off $100,000 of student loan debt.
Read on for the strategies I’m using to make the final push and pay off the last $31,000 of student loans. Estimated read time ~ 3 min watch time ~2.5 min.
In case you’re unfamiliar with my personal student loan story, it goes like this. I’m a first generation college student and attended a public, in-state university to get my Pharm.D. I worked two jobs during college and got scholarships to help pay for costs. Despite that, I borrowed $118,000 in federal student loans to become a pharmacist. By the time I graduated I owed $128,000 due to interest on my unsubsidized loans. Add on a year of residency to specialize and despite making payments my balance grew to $132,000.
I made the mistake of paying very aggresivly under my existing federal repayment plan. The problem was that my average interest rate was around 6.5%. After a year or so of that I wasn’t making the progress I expected and learned about refinancing. I refinanced my student loans for a 3.36% interest rate and learned an expensive lesson.
But here we are today and I’ve used my low interest rate to make some major progress on principal. $100,000 of progress to be exact. Here are the strategies I’m using to get me to the finish line and out of student loan debt for good.
Check your student loan balance often.
For me, I check my student loan balance every time I get paid which happens to be bimonthly. Keeping an eye on my balance reminds me how annoying interest is and keeps the reality of my debt fresh in my mind.
Lately, checking the balance has also been very encouraging. I love seeing how fast the principal is decreasing.
Make extra payments.
This is the number one way I’m on track to get out of six figures of student loan debt in the next year. I have to pay more than the minimum monthly payment.
I make a point to make an extra payment every time I get paid. I do it after paying all my bills (including retirement and savings) and before I decide how much “fun money” I have left after all that is paid.
I live in the Midwest and have a relatively low cost of living compared to other parts of the country, so the size of the extra payment you can make is probably going to be different. That’s fine, just keep the mindset that every little bit extra you can pay now gives you returns in time and interest down the road.
Acknowledge milestones.
Be sure to acknowledge and mark your successes paying down your debt. Even if it’s something like acknowledging the fact that you chose the right repayment plan, or slashed your interest rate refinancing, or submitted the employer certification form required for Public Service Loan Forgiveness.
Giving yourself credit where it’s due is great for motivating you to stay on the long path to freedom. Set up milestones that mean something to you and pat yourself on the back for a second before returning to the grind of repayment. Just don’t get too crazy treating yourself!
Imagine freedom.
Spend some time thinking about what your life will look like when you don’t have to make your monthly student loan payment anymore. Think of how that will feel financially. Think of what you’re going to use your money for instead.
Use that vision and the desire to be free from your student loan debt to fuel you to keep on keepin’ on! I know the fight can be a long one but I’m here to cheer you on every step of the way. I know you can find your #debtfreedream
How much progress have you made on your student loan balance? I love hearing everyone’s student loan stories so be sure to leave me a comment below or on the Repayable Facebook Page.
Well we’re half way through 2018 which means it’s a handy time to check in with your student loan repayment goals. Read or watch this if you want to see how things are going for me and check out my tips for making extra student loan payments.
Estimated read time ~5 minutes estimated watch time at 1.5x speed ~ 2.5 minutes.
It’s all about your individual student loan repayment goal.
Everyone is going to have a different student loan repayment goal that makes sense for them. There is no “one size fits all” dollar amount that is right for every borrower. You’ve got to pay what is reasonable for your student loan amount, your income, and the rest of your financial goals.
The best repayment goal is $3,000 each month toward my student loans. I’ve refinanced and my required monthly payment is $1,345 each month so that means I pay at least an extra $1,645 a month on my student loans. Paying $3,000 each month is aggressive enough that I can pay my debt back quickly but still leaves me enough room in my monthly budget to spend on the experiences and things that matter most to me.
Track your repayment progress.
It’s easy to set a goal and then not check in with it until the end of the calendar year. But by then if you’re not on track it’s too late to make any changes. So I check in with my repayment progress quarterly (every three months) to be sure I’m on track and celebrate any extra success I may have had.
In the 2nd Quarter of 2018 I paid $9,840 on my student loans.
My goal was to pay $9,000 ($3,000/month X 3 months) so I was able to pay a little bit extra during the second quarter.
Use extra income for your student loans.
It seems obvious that you would want to use your extra income to pay down your student loan debt but it can be harder to practice than you might think.
The money I used this quarter to pay extra came from some consulting work I do on the side. It can be tough to convince myself to apply a percentage of that to my student loans because I hustle on top of my 40 hour work week to earn that money so sometimes I want to treat myself with it.
What has helped me to use this extra income for my student loans is to remind myself that paying even a few hundred extra means less time I’m beholden to student loan debt. Even shaving a month or two off of that debt buys me a freedom that I can’t find when I buy things or even when I travel.
Keep the big picture in view.
One thing that’s been very rewarding for me is to track my progress over the entire year.
In 2018 I’ve paid $20,385 toward my student loans. I feel great about that number. I started with almost $65,000 in January and now I have just over $45,000 left to pay off.
Each payment gets me a little bit closer to my #debtfreedream.
What are your student loan repayment goals? I would love to hear them and cheer you on toward success. Let me know in the comments below or on the Repayable Facebook Page.
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