How I Paid Off My Student Loan in 5 Months After Years of No Progress

By Jackie Beck   Updated 05/19/2021 at 5:48 pm

Like many people, I took out a student loan in order to finish graduate school.

Well, that’s not completely true. I did borrow money (about $19,000), but it wasn’t so that I could finish graduate school. In fact, my employer at the time would have happily paid for the rest of it.

Instead, I took out a student loan so that I wouldn’t have to work while finishing up school.

Anyway, after borrowing the money, I paid sporadically on the loan when it entered repayment. There were months when I paid nothing but interest due to the loan being in forbearance, etc. There were also months when I paid $200 per month, which was my agreed-upon larger-than-minimum monthly payment.

Then I had a wake-up call one hot June day. I realized that 9 years after taking out the loan, I still owed almost half of what I’d borrowed: $9,759.46.

Less than 5 months later — I owed zero.

How did I pay off the balance in less than 5 months?

It wasn’t by getting a fancy job with a big salary. (I brought home about $2100 each month at the time.)

It was by focusing solely on that debt. For a little more than 4 months, I woke up every single day thinking about how I could pay off the debt as quickly as possible.

I got obsessive

I got hyper-focused on paying off my student loan, and questioned everything.

Could I make extra money somehow? Could I cut expenses? Start tracking them so I’d know what my expenses even were to begin with? Could I maybe send in multiple payments each month to the loan in order to pay less interest? What about getting discount on the things I absolutely did have to buy?

The answer to all of those questions was yes.

I was consumed by paying off that debt. And it worked. The more I sent in, the more I wanted to send in, and the more fired up I got.

By September of that year, I had paid off $5359.28 of the debt. That left a balance of $4400.18.

Knocking out the rest

Finally, the obvious hit. I was telling my husband that I didn’t understand why people who had the money to pay off a debt didn’t do it, when duh, I realized that described ME. I had some money in the bank that I’d been saving up for emergencies.

It hadn’t occurred to me to use that money to pay off the balance of my debt until that moment, because the money in the bank made me feel secure. But that feeling of security was really just an illusion, and I was paying more each month in interest than I was earning on the money in savings.

So I withdrew the balance of what was needed to get my debt paid off and sent it in.

My life changed when I paid off my student loan

That’s when my life changed — the moment I felt what it was like to be debt free — to be free of worry and stress related to it, and to have money to do whatever I wanted to with each month.

It’s a moment that really put my husband and I on the path to (eventually) becoming completely debt free, house and everything.

I believe that’s possible for everyone. It’s a matter of changing your mindset and actions, and then sticking with it. If you feel the same, I hope you’ll join in :)

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What a wake up call! 9 years after taking out my student loan, I still owed almost half of what I'd borrowed. But things changed, fast!

24 thoughts on “How I Paid Off My Student Loan in 5 Months After Years of No Progress

  1. Hyper focused on that one debt will get it done. When my wife and I destroyed all of our debts it was because we focused on them one by one until they were all gone. Today, I have gotten away from that thinking and the debts have slowly piled back up. That is ok because we are going to kill them again!

    I want to join in that feeling of being debt free!!

  2. I actually laughed when you came to the realization you had money in the bank but had debt too…I did the same thing! It just dawned on my one day that we had a car loan of $10,000 and $15,000 in our emergency fund…big fund hit later, no debt except our mortgage. I feel silly that I put it off for so long…

    1. I think I literally smacked myself on the forehead when I realized it! Isn’t it funny how we don’t even notice stuff about ourselves like that sometimes?

  3. Yes, great story. Thanks for sharing. You really were determined to reach your goal. This kind of determination is inspiring since one can feel so much pressure to just give up. When I was in debt I too focused the majority of my energy on paying it off. It was well worth it in the end to be debt free.

    1. You know, I was both determined and excited to reach my goal. I still wasn’t used to actually making money on a regular basis (since I’d been unemployed for four years prior to that) so it was a good time to just continue living on barely anything and see massive progress.

  4. That definitely is some dedication, right there. From speaking with clients, I know that many people wish they could be as diligent and obsessive over their debt as this. The problem is that many people lack the motivation. Even at the verge of losing there home to debt, they still can’t seem to quit the frivolous spending. People need to realize that lots of little wins build up into a big win – and that must feel pretty damn good.

    1. It does feel really good, even now. Going from owing money to having money is huge. I wonder what would help people to find the motivation.

    1. Me too! It made a huge difference. I have built up an emergency fund of more than a year’s worth of expenses, am sending 35% of my salary toward retirement, am investing, and have been doing plenty of fun stuff. The mortgage is the target now.

  5. Become obsessed! So important when paying off debt – eyes on the prize. We also at one point had a car loan we were paying on and enough money in the bank to pay it off. Seems so crazy now to try to earn a measly interest income from your savings when you are paying out more in interest on that loan.

    1. I think the biggest step is deciding (and then committing) to really do it. I know I do a lot more interesting things with that $200 a month now than I did all those years I had the loan.

  6. You just described my story. I kept a small student loan around for a while, when I could have paid it off in a couple months. One day I came to my senses, and made it go away.

    1. Glad to hear you made it go away. Nearly $10K wasn’t a small sum to me by any means though — it was close to what I’d made for the four years prior that combined.

  7. This is really inspiring, especially for those of us who WANT to be debt-free. But, I can’t help but wonder, how can those of us who have the same take home pay as you, do the same thing you did when we have virtually NO savings can ? I only have about $2,500 saved up between savings/checking. I’m $68k in the hole making $200/mo payments on a Income-Driven plan. I live in a studio. I drive a PT cruiser. I cook all of my meals and bring them to work. I clip coupons. I sell stuff Amazon, Ebay, and OfferUp. I even took a pt gig in retail at one point. I’m sure there are people like me, who cut corners and scrimp as much as possible, but are still struggling. I paid off $2,400 last year. I know it’s just not enough. I think about this debt everyday, but do not have any money in the bank to have that forehead smack/”duh” moment, especially with a car that needs frequent repairs. Any advice for those of us lacking hope?

    1. Maybe knowing that it IS possible will give you a little hope. It sounds like you’re doing a whole lot of things that are moving you in the right direction. I wouldn’t call saving up $2,500 “only” by any means. I would say if you’re already scrimping and saving, your best bet is to work on increasing income. Maybe see if you can get a raise in your current job, or a better paying job. Or like you’ve already done, a second job. I ended up doing all of those things and it really helps.

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