$40,000. That’s the total amount of student loans that I accumulated while I was getting my undergraduate and graduate degrees. The amount that is left is still at $38,000 now, mainly because I haven’t really bothered with student loan repayment (even though I should have!) and interest has stupidly been building up. I would have taken out…
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$40,000.
That’s the total amount of student loans that I accumulated while I was getting my undergraduate and graduate degrees. The amount that is left is still at $38,000 now, mainly because I haven’t really bothered with student loan repayment (even though I should have!) and interest has stupidly been building up. I would have taken out more in student loans but the last couple of semesters I wised up and paid for in cash instead.
It is a lot of student loan debt, but I don’t feel completely horrible about it, I did earn 2 undergraduate degrees and a Finance MBA all for that amount. If I wouldn’t have earned scholarships or paid some of it, it would have easily been 3 or 4 times that amount.
I’ve been talking a lot about my plan to payoff my student loans as fast as possible. Back in February of 2012, I started my action plan for them to be gone. For me, it’s almost to the point where I am obsessing a little too much about my student loan repayment plan. I am constantly trying to figure out my cash flow and budget to see if I can get there any more quickly. I’m really focused on my extra income efforts and it’s an obsession now.
Luckily, I was able to graduate and find a great job back in 2010 and it helped me pay back student loans a little bit and start my student loan repayment plan. So many people told me that I wouldn’t find a job though. They were probably just trying to help me out by telling me what most kids my age didn’t know back then, but I wasn’t listening.
Now that I am done with graduate school (which I am extremely happy about being done with), I really need to start focusing and finally starting to aggressively pay back my student loans and start my student loan repayment. I’ve been paying down my student loans a little bit here and there but not enough where you can actually notice it.
My goal with my student loan repayment plan.
My goal is to have my student loans completely gone by April of 2013, or even possibly March of 2013. I know any sooner is most likely not possible since my plan is already pretty strict. Learning how to pay student loans faster is not easy though. Yes, you can read about how to pay student loans faster, but you really need to sit down and make an action plan.
In order to complete my goal, I need to pay around $7,000 per month on my student loans for around 6 months (which would make the payoff date April of 2013). This most likely sounds insane, but I know it’s possible. No, I will not be living off of Ramen noodles. I will still have the same quality of life and be doing nearly everything the same.
My main thing is that we have really ramped up our income in the past couple of months. W is currently making more than three times what he used to make at his old job, and I’m making more as well. This extra money definitely helps make this goal more attainable.
So, as long as our income continues to remain the same, then my plan should work perfectly. And if we start to make anymore money, then hopefully I will be able to fully pay off my student loans in March, however, a one month difference will not kill me.
Here’s what I have done so far and what you should start with when learning how to pay student loans faster. Also, the below can also help you if you are wanting to learn how to pay for college without going into debt.
1. Add up your total student loan debt for your student loan repayment plan.
Your very first step with your student loan repayment is to add up your total student loan debt. Use a student loan calculator if you need to.
This may sound stupid, but have you ever truly added up your total student loan debt, down to the exact cent? Enter reality and figure out how much you actually owe. I have a couple of friends who still can’t really say how much they owe, because they aren’t sure. I can understand this because some of the loans that you’ve taken out might have been from 4 or more years ago.
When I added up my total student loan debt, I wasn’t completely sure of the exact dollar amount. YES I REALLY JUST SAID THAT, I’m a bad personal finance blogger. I did know of the general area, but I was off by around $2,000. When I finally sat down and realized the exact dollar amount that I owed, reality really set in.
Once you know that exact number, it’ll help you realize that you need an student loan repayment action plan to pay it off.
Also, using a student loan calculator can help if you want to figure out your monthly student loan payment. You can find several student loan calculators online with just a simple Google search.
2. Decide which student loans you’ll pay off first.
It’s really up to you personally. Different people prefer to attack their debt in different ways. With me, I’m trying to get rid of my student loans which have the highest interest rates. A large amount of my loans are at 6.8%.
I prefer to pay the highest so that I am gaining the LEAST amount of interest on my loans that I possibly can. If I stared by knocking out a loan than gets 0% (which none of mine do, just hypothetically), then I would still be gaining interest on my other loans and that, in the end, would not be worth it to me at all.
However, some choose to pay off the loans that have the highest or lowest amounts. This way you can really feel like you are accomplishing something when you knock out loans one by one. If you knocked out the student loans with the lowest amounts first, then you will probably feel like you’re accomplishing more and be more motivated with each student loan that you eliminate.
3. Find extra money to apply towards your student loans.
I’ve really been working hard on finding ways to earn extra income for help paying student loans. I’ve been doing great with this, but it hasn’t always been this easy. In September I made $3,275 and in October I made $3,700 (both after fees but before taxes) in extra income. Before September, I wasn’t making nearly these amounts, and I am still very surprised.
For me, the main thing I do to make extra money is blogging and freelancing. If you are interested in starting a blog of your own, I have a tutorial that will show you how to easily make a blog of your own in just minutes. You can find the tutorial here.
My goal right now is to throw nearly all of my extra income towards my student loans so that I can pay off my student loans fast. Now, why am I not saying “ALL” instead of “nearly?” It’s because I am being realistic. I know for a fact that I will not put all of it towards student loans, in fact, I’ve already spent some of it (not a lot though).
4. If you can or want to, then ELIMINATE expenses!
There are probably a couple of things out there that you do not absolutely need. Or maybe there are things in your life that you can get for cheaper. Try calling any of the companies that you do business with and see if they can lower their prices at all. This can be your gym, cell phone, internet and so on. Getting a cheaper price can make student loan repayment attainable.
There are also many other things that you can do. Lowering your auto expenses, lowering your utility bills, eating at home more often, cooking from scratch and so on are all great things you can do to lower your expenses.
We are really working on eating at home as much as we can. We used to go out to eat way too much. What’s the point of eating out at a restaurant every single day? We were being stupid, it’s that plain and simple.
Cutting your expenses can help you pay off your student loans fast and reach your student loan repayment plan with a little less stress.
What are you doing to pay off your student loans quicker?
Answer these questions:
1. How much do you owe?
2. How much have you paid off?
3. How long do you think it will take you to pay your student loans off completely?
4. What are you doing to pay them off more quickly?
Hey! I’m Michelle Schroeder-Gardner and I am the founder of Making Sense of Cents. I’m passionate about all things personal finance, side hustles, making extra money, and online businesses. I have been featured in major publications such as Forbes, CNBC, Time, and Business Insider. Learn more here.
Good for you. Sometimes I forget the you are sonyoung. You are so mature and responsible and highly intelligent.
I didn't have any debt from undergrad, but came out with about 15k after grad school. We were making so little money at the time, but paid them off within a year.
My recent post Friday confessions
That sounds awesome! I can't wait until you send that final check in…BOOM! We paid Greg's student loans off this year and it felt awesome. You are almost there- great job!
My recent post What Would You Do For Money…If You Had To?
I owe about 60,000 and I've paid a monthly payment of about 600 for the past year. So I've probably paid off about 7,000ish of it so far? I've only been out of college for about a year and a half, so I dont make enough money to pay off them at a higher rate than I am now. I borrowed from two different companies- one I'm paying the max amount so those will be paid off in about 5 years, and the other I'm paying a lower amount because I make such low income- so that may take 10-20 years to pay off. Ugh. I give you credit for paying yours off in such a short period of time!
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It looks like a good plan. I think it's great to throw your side income at the loans. Without it I am sure it would take you quite a bit longer to pay them off. Thankfully we paid my last student loans off in January, it was a great feeling to be finally free of them.
Good luck Michelle! This is very ambitious but you look very motivated, so completely doable. 6.8 is very high, it makes complete sense to tackle that one first.
My recent post Little house in Guatemala, week 3
Congrats on your new commitment to paying off your loans! I'm so excited to see you ATTACK them!
I currently owe $16k in student loans. They are subsidized and in deferment.
I have paid off about $1k. (I had one small unsubsidized loan.)
We could pay the loans today if we wanted to – we have the money set aside – but since they are in deferment we have part of the money invested to try to get a bit of a return before I graduate and my deferment period ends. So far that's going well. So the plan is to pay the loans the day I stop being a student, which will probably be in May 2014.
My recent post Boomerang Kids, Listen Up: It’s Not All about You
I would do what you are doing as well. Some of my loans came out of deferment last month and the rest begin in March of 2013, but I plan on paying them off before interest accrues.
My recent post My $38,000 Student Loan Payoff Plan
At first I balked at how quickly you want to pay them off-March 2013 is around the corner, but you've been doing so great with your side hustles I think this is easily attainable. I have 2300.00 left on my student loan and I SHOULD pay it off, but it's so small I often forget and put the money towards more "pressing" goals or situations. You can do it!
Thanks! And I plan on putting income and about $10,000 from savings towards it, so that would make it a lot easier.
My recent post My $38,000 Student Loan Payoff Plan
My girlfriend owes around 60 to 62 thousand. We have the exact number at home. When she graduated 1.5 years ago she had around 80k so she is making good progress.
We hope to pay them off by early 2014, maybe in the March to April time frame. I am saving money to put a big chunk down once we get married.
Wouldn't they be over the inflation rate since they are at 6.8%? I am honestly asking this because I am confused.
My recent post My $38,000 Student Loan Payoff Plan
It doesn't surprise me that you have 40K in student loans. Grad school is expensive!
I'm glad you are aggressively clearing off those loans. I know once they are gone you will have a weight lifted off your shoulders.
We only have a car loan (around $3500 right now, down from $5300 in July). I'm paying $400 a month to clear it off. So close! August 2013 is the latest this loan will be paid off. We might pay it off sooner 🙂
Honestly, nothing. With no job and no income, my loans just keep growing. : (
Luckily they're all federal, and under IBR, but it doesn't help much. I still owe it. And just for one undergrad degree from a not that great school.
1. How much do you owe? $45,000
2. How much have you paid off? $0
3. How long do you think it will take you to pay your student loans off completely? Depending on what happens, it coudl take five years, or it could take 20. The future looks so uncertain right now with no job and no money and nothing, it seems, to help with this.
4. What are you doing to pay them off more quickly? Nothing. I don't have any money. : (
Okay, that was totally depressing. Offering another perspective, I guess.
I graduated in May 2010 with $23,906 in student loans. (I obviously added them all up to come up with that number, and now I don't think I'll ever forget it!) I started paying them after the 6 month grace period ended in November 2010, and I had them completely paid off in September 2012. While that's not nearly as aggressive as what you're planning on doing, I think it was pretty good. I just couldn't imagine paying the minimum for TEN years and watching all that interest add up. I basically did everything you've outlined, and it worked perfectly, and I was probably also a little obsessive about my plan. Good luck to you!
I owe about 10K from grad school with no plan to pay them off early. They are at 2.3% so I don't see the point in paying them off early. I would rather have the the cash flow available. I did pay off my loans at 6.8% really quick though, but now I am just taking my sweet time.
I owe around $22,000 and I only know this because there's a site that keeps a tally of all my loans. The number really weighs on me as I won't be finished with my undergrad until Spring 2014. My guess is that by the time I'm done I'll be in the mid 30's. My most irritating loan is at 9% and as much as I'd like to tackle it, I can't. My current job simply doesn't pay enough for me to be able to make early payments.
I wouldn't feel too bad. 9% is high. I'm sure once you graduate that you will be able to start paying it. Just make sure you start applying for career positions at least a couple of months before you graduate.
One of my student loans ($20,000) just went into repayment this month, while I'm still a student for 6 more months. Apparently, there is no more deferment, but I also did not realize that it was private, and not federal like all of my other loans. How I didn't know that is beyond me, because I track everything I do and have like a crazy person. Unfortunately, I am still in school, and don't have a job, so all of our income, less than $30,000 a year is going towards our house and car payments right now, as well as standard living costs. Other than our cell phones, we have already gotten rid of everything not necessary. I've been trying to bring some side income in, but getting started is hard. Any more tips to share? I've already picked up the mystery shopping, and love it.
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Good for you. Sometimes I forget the you are sonyoung. You are so mature and responsible and highly intelligent.
I didn't have any debt from undergrad, but came out with about 15k after grad school. We were making so little money at the time, but paid them off within a year.
My recent post Friday confessions
Thanks so much 🙂 And that's great about paying them off so quickly!
My recent post My $38,000 Student Loan Payoff Plan
That sounds awesome! I can't wait until you send that final check in…BOOM! We paid Greg's student loans off this year and it felt awesome. You are almost there- great job!
My recent post What Would You Do For Money…If You Had To?
I'm so jealous!
My recent post My $38,000 Student Loan Payoff Plan
I owe about 60,000 and I've paid a monthly payment of about 600 for the past year. So I've probably paid off about 7,000ish of it so far? I've only been out of college for about a year and a half, so I dont make enough money to pay off them at a higher rate than I am now. I borrowed from two different companies- one I'm paying the max amount so those will be paid off in about 5 years, and the other I'm paying a lower amount because I make such low income- so that may take 10-20 years to pay off. Ugh. I give you credit for paying yours off in such a short period of time!
My recent post My Favorite Thanksgiving Food- Green Bean Casserole
Good luck with your payments and thanks!
My recent post My $38,000 Student Loan Payoff Plan
It looks like a good plan. I think it's great to throw your side income at the loans. Without it I am sure it would take you quite a bit longer to pay them off. Thankfully we paid my last student loans off in January, it was a great feeling to be finally free of them.
Yes it would take a little longer so I'm glad that I have the extra income.
My recent post My $38,000 Student Loan Payoff Plan
Good luck Michelle! This is very ambitious but you look very motivated, so completely doable. 6.8 is very high, it makes complete sense to tackle that one first.
My recent post Little house in Guatemala, week 3
Almost all of them are at 6.8 and it makes me cringe.
My recent post My $38,000 Student Loan Payoff Plan
Congrats on your new commitment to paying off your loans! I'm so excited to see you ATTACK them!
I currently owe $16k in student loans. They are subsidized and in deferment.
I have paid off about $1k. (I had one small unsubsidized loan.)
We could pay the loans today if we wanted to – we have the money set aside – but since they are in deferment we have part of the money invested to try to get a bit of a return before I graduate and my deferment period ends. So far that's going well. So the plan is to pay the loans the day I stop being a student, which will probably be in May 2014.
My recent post Boomerang Kids, Listen Up: It’s Not All about You
I would do what you are doing as well. Some of my loans came out of deferment last month and the rest begin in March of 2013, but I plan on paying them off before interest accrues.
My recent post My $38,000 Student Loan Payoff Plan
At first I balked at how quickly you want to pay them off-March 2013 is around the corner, but you've been doing so great with your side hustles I think this is easily attainable. I have 2300.00 left on my student loan and I SHOULD pay it off, but it's so small I often forget and put the money towards more "pressing" goals or situations. You can do it!
Thanks! And I plan on putting income and about $10,000 from savings towards it, so that would make it a lot easier.
My recent post My $38,000 Student Loan Payoff Plan
My girlfriend owes around 60 to 62 thousand. We have the exact number at home. When she graduated 1.5 years ago she had around 80k so she is making good progress.
We hope to pay them off by early 2014, maybe in the March to April time frame. I am saving money to put a big chunk down once we get married.
Yes she is definitely making great progress! Good job.
My recent post My $38,000 Student Loan Payoff Plan
Wouldn't they be over the inflation rate since they are at 6.8%? I am honestly asking this because I am confused.
My recent post My $38,000 Student Loan Payoff Plan
It doesn't surprise me that you have 40K in student loans. Grad school is expensive!
I'm glad you are aggressively clearing off those loans. I know once they are gone you will have a weight lifted off your shoulders.
We only have a car loan (around $3500 right now, down from $5300 in July). I'm paying $400 a month to clear it off. So close! August 2013 is the latest this loan will be paid off. We might pay it off sooner 🙂
Grad school is definitely expensive. My undergrad was more expensive though!
Honestly, nothing. With no job and no income, my loans just keep growing. : (
Luckily they're all federal, and under IBR, but it doesn't help much. I still owe it. And just for one undergrad degree from a not that great school.
1. How much do you owe? $45,000
2. How much have you paid off? $0
3. How long do you think it will take you to pay your student loans off completely? Depending on what happens, it coudl take five years, or it could take 20. The future looks so uncertain right now with no job and no money and nothing, it seems, to help with this.
4. What are you doing to pay them off more quickly? Nothing. I don't have any money. : (
Okay, that was totally depressing. Offering another perspective, I guess.
Thanks for your perspective! I do have faith that things will start going well for you soon.
My recent post My $38,000 Student Loan Payoff Plan
I graduated in May 2010 with $23,906 in student loans. (I obviously added them all up to come up with that number, and now I don't think I'll ever forget it!) I started paying them after the 6 month grace period ended in November 2010, and I had them completely paid off in September 2012. While that's not nearly as aggressive as what you're planning on doing, I think it was pretty good. I just couldn't imagine paying the minimum for TEN years and watching all that interest add up. I basically did everything you've outlined, and it worked perfectly, and I was probably also a little obsessive about my plan. Good luck to you!
I owe about 10K from grad school with no plan to pay them off early. They are at 2.3% so I don't see the point in paying them off early. I would rather have the the cash flow available. I did pay off my loans at 6.8% really quick though, but now I am just taking my sweet time.
I wish mine were at 2.3%, that's awesome.
I owe around $22,000 and I only know this because there's a site that keeps a tally of all my loans. The number really weighs on me as I won't be finished with my undergrad until Spring 2014. My guess is that by the time I'm done I'll be in the mid 30's. My most irritating loan is at 9% and as much as I'd like to tackle it, I can't. My current job simply doesn't pay enough for me to be able to make early payments.
I wouldn't feel too bad. 9% is high. I'm sure once you graduate that you will be able to start paying it. Just make sure you start applying for career positions at least a couple of months before you graduate.
One of my student loans ($20,000) just went into repayment this month, while I'm still a student for 6 more months. Apparently, there is no more deferment, but I also did not realize that it was private, and not federal like all of my other loans. How I didn't know that is beyond me, because I track everything I do and have like a crazy person. Unfortunately, I am still in school, and don't have a job, so all of our income, less than $30,000 a year is going towards our house and car payments right now, as well as standard living costs. Other than our cell phones, we have already gotten rid of everything not necessary. I've been trying to bring some side income in, but getting started is hard. Any more tips to share? I've already picked up the mystery shopping, and love it.
It was hard for me in the beginning as well. I would just keep on trying! Every little bit helps and try to snowflake your debt away if you can.