I paid off my student loan last month. I don’t have any profound advice about repaying debt. It’s all very simple. Pay it back. Be aware of your circumstances, make a plan and stick with it.
I finished my masters degree in May 2012. In December 2012 I received a letter from my lender about the repayment terms. I believe I owed around $35,000. They wanted around $500 a month. At the time I was making my living by working three low wage part time jobs, two were in retail and one was as a waitress. I found the $500 payments to be overwhelming.
I called the lender and told them I would pay them every month but I couldn’t pay what they were asking. They changed the terms of my loan. My payments were decreased to around $200 per month. I made those payments for a few years and when I checked my balance it hadn’t changed much from the balance of the loan shortly after graduation.
I called the loan company again and they explained the situation better. I learned that I was paying $7 a day in interest on the loan. The $200 per month I was paying wasn’t even covering the interest and my payments weren’t touching the principle. The lowered monthly payment merely kept my accounts in good standing.
Once I became aware of my circumstances I devised a plan to get out of debt. I decided to increase my payments. The interest was aggressive so I needed to become more aggressive. My employment situation improved over time. It still isn’t great but keep in mind I was working three part time, low wage jobs at the beginning of this story. I eventually got a somewhat respectable 9-5 which I’ve had for the last five years.
I worked about fifty five hours per week for five years. I worked three days a week for twelve hours between the two jobs, every Saturday for eight hours and I took most Sundays off. That was my schedule for five years until I quit my part time job for COVID 19 related reasons. By that time I had already paid my car off so I had money free to maintain my student loan payments.
I had increased my payments to over $500 per month which was what they were asking for at the beginning. Most months I made payments between $500-$700. As my individual loan amounts got lower I would pay them off in full. My last few payments were over $1000.
I’ve read many articles and seen You Tube videos about repaying debt. They like to pretend that they have some mystic advice. There is none. There is no oracle speaking money secrets. All these stories about people repaying large amounts of debt back in a fairly short time had the money to do so.
It’s all math. You have to devote more money to repaying debt through cutting back and reallocating money in your budget or you have to come up with more money. There wasn’t much for me to cut back because I am not a wealthy woman so the answer was to make more money to repay the loan. That’s it. That’s the formula.
Working six days a week for so many years was taxing and a sacrifice but it was worth it. The debt is gone. Now that the debt is paid I have more freedom in my future plans. My new focus is saving for retirement. I may also buy a home in the next few years.
I wrote this to encourage others who have debt repayment. It may take a long time but the goal is attainable. It takes dedication and perseverance but your financial future is worth it. If you owe money part of every dollar you earn belongs to someone else.
Repaying student loan debt is difficult but it is not an insurmountable task. Keep in mind I do not make much money so if you graduate and make a good salary it will be easier for you to repay the debt. If you have dreams of furthering your education clearly assess the situation with logic and a clear head, not fear and emotion.
Sit down with a pencil and paper and write things out. It’s all a matter of math and how the numbers work with your life circumstances and goals. Don’t listen to social media opinions of student loan debt on either side of the loan debate.
Consider your variables and do not mistake the life situation for others as your own. Accurately assess your options and long term outcomes. There are too many people blowing smoke and spreading fear on both sides of the loan debate. I also wouldn’t wait for an act of Congress to cancel debt or change the terms of the loan. It’s quite refreshing to not be a part of the great American student loan debate. Best wishes to you and congratulations to me.