I have major student loan regret. I’m not going to lie, looking back, I was not well educated on how loans worked. I didn’t understand the financial repercussions of signing on for those loans. In my mind, they were a necessary part of getting an education. I was a person that needed a lot of student loan debt help.
Actually, everyone was getting loans, so to me it wasn’t anything out of the ordinary.
I didn’t understand how much I had until graduated undergrad with about $20K in loans. At the time, that seamed like a behemoth amount. But it would only grow as I went off and took a risk going to law school for 1 year. By the end of that year, I finished with 49K worth of loans.
Still, I was in denial of how much in loans I owed. I paid off a little here and there and sat on some unused loan money for a few years, while I was trying to build a safety net of emergency funds.
From the age of 18-24, I was not smart with money.
From 2011-2014, I was making small $200-$400 payments, it wasn’t until 2015 I realized I couldn’t forebear any longer and made my mind up to commit to the 10 year payment plan. By that time, my debt had ballooned to nearly $60K. Mind you, the student loan payment for a 10 year payment plan for the average overall student loan of $25K is $280.
Until now I’m still paying a minimum of $871 towards my principle and interest. But I’m working towards pushing and paying off my loans in bulk. Earlier this year I paid off a $10K loan in full!
I’m lucky, I’m at $24K-25K in remaining debt, down more than half after deciding to get real about my student loan debt. And in 3 more years, if not two, it will be completely gone.
Here are some tips to live with student loan debt. Sometimes it’s inevitable to have to take out loans but we can at least minimize the shortfalls and reduce college debt.
- Pay Off Your Loans While You’re In School:
I had these stupid minimum wage jobs that brought in a couple hundred here and there. If I put at least 150 a month towards my loans, starting day 1, do you know how much of a dent that would have made in principle and future interest? Whoosh, I don’t even want to think about it. Probably closer to 10K but I’m here not to regret and feel sorry for myself but to hopefully wake up a few other people who are still in dreamland about their loans!
2. Stop pretending you’re loans aren’t that bad.
Whether you have $1000 in loans or $200K in loans, you need to face them as soon as you’re financially able to. Make a plan on how to pay or at least minimize your loans.
My sister is a great example of understanding how deep of shit she was in. She went to two Ivy League Schools, Cornell for Undergrad and Columbia for Grad. She was a smarty pants in many ways, and got a practical degree in engineering. Still, her $70K salary doesn’t seem like enough to pay off her $125K in student loans from 6 years of Ivy education.
She was smart in the sense she worked during those years and put whatever she could working paid internships and hosting at restaurants towards her loans. She saved herself thousands by doing that.
Though she makes a decent salary, she still lives below her means and drops 2K a month towards her loans. That bad boy is going to be paid off in 5-6 years. Considering the size of the loan, that’s incredible!
3. For Godsake, go to college for something practical!
I had a friend that started for speech pathology in college and spent two years pursuing that. Then she changed direction and decided to do performing arts, even though our school wasn’t a performing arts school. She then transferred to another private college, lived on their Manhattan campus and finished her schooling there. She finished with a liberal arts degree, because the other school she transferred to wasn’t a performing arts school either.
She worked a few years, then decided to go back to school for teaching. She went back for another 3 years of undergrad or grad and is finally a teacher.
But OMG she is in too much debt. Nearly $200K worth of debt with only a $50K salary? Like how was this ever going to work for her? What was she aiming to do with all these changes and all these expenditures?
My friend is just one gleaming example of all the people I know who weren’t practical in choosing or at least funding their degrees. I have nothing against less practical degrees like art, liberal arts, and philosophy. But did she really need to spend $200K to get that? Wouldn’t it have been better for her to just go to a community college first and then transfer?
I’m not perfect and I’m one of those people who didn’t think about the practical nature of my degree, Legal Studies. But I made the most of it and got my real estate license through the course I took.. I realized that I couldn’t keep running from the hardness of finding a path and managed to carve one out through an opportunity provided from my education.
4. Live Frugally to Save Even Move Towards Loans
For me living very frugally felt like punishment.
“I can’t afford certain things because I made this bad choice and collected all these loans.”
Still to this day, I struggle with frugal living BUT you can take small steps to at least spend your money wiser.
I’ve stopped buying coffee outside like at Starbucks or DD. $1.95 3X a week for a cup of coffee adds up. Over a year, that’s exactly $304 a year just on coffee. With that money, you can buy a $30 coffee maker and 2 years worth of coffee grinds! It just didn’t make sense.
I stopped buying frivolous things like random makeup and clothes to build a wardrobe that was already big enough. I stopped going out to drinks on every occasion. My socializing cut back a little bit, which kind of sucked. But I invested in spending time with people who didn’t need to spend money to have fun, like my parents and sisters.
Cutting the non essentials was a hard change, but putting it towards my student loans was liberating.
5. Work a side hustle
I’ve never had a chance to tackle this but I would encourage this in anyone who has the free time or talent.
Taking on a 2nd job like Uber or working at the pizza place down the street can definitely help you.
Imagine taking on a part time holiday position on top of your 9-5 full time job. If you earn an additional $600 a month, you can put all of that towards your loans on top of the payments you usually make.
This can help you make a nice dent in your loans and help you pay off your loans faster. I’ve heard of people paying off their large five figure loans in just a few years with this method. Combine that with all the other methods we just discussed and that could be the way out of debt.
Overall, I hope this post has helped you to realize that even though we had to take these godforsaken loans to get ahead, there’s no reason why these loans should keep us behind financially.
Wishing you all prosperity and financial wellness 🙂