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 :)