I’m back today to hit y’all with my February goal progress. How much did I pay off? How much do I have left? CAN YOU DEAL WITH THE SUSPENSE?
Ok, let’s tone it down for a second. Before I get into the facts and figures I want to say something I’ve been coming to realize: focusing on my debt payoff has given my life a wonderfully hopeful feeling.
That’s the best way I can describe it. A year ago I was working very part-time as a caterer and felt nothing but anxiety when it came to my loans. No plan, no money, certainly no action to take. Today I am closer than ever before to paying them off and fulfilling my plan each day. It feels amazing! I feel clearheaded and lighter than I ever have before. Watching the balance go down each month is it’s own reward. What’s really put me in this good place is learning about money in general.
I didn’t grow up with a lot of money. In fact, there were straight up bad financial times in my youth. My family persevered and with some help, got through it all. That didn’t lead to a whole lot of money and financial education though. I learned saving was important but I was never taught about investing or about the stock market, never taught to think about and plan for retirement. Never told how to handle sums of money. It was simply assumed that I would go to college one day and college would be my ticket to everything else, all the life knowledge I would need. After college I would get a job, that job would set me up with a 401K and I would contribute some amount until I turned 65, when I would retire. Even this though, was never a conversation I had with any adult in my life growing up.
When I graduated college with debt, I had no real understanding of it. I didn’t know the best way to pay it back or how it could negatively affect my life. I also had no idea how to earn more money, ask for raises, where to put money besides a savings account, what investing was….the list goes on. I had no concept of money beyond that it was important and I wanted more of it.
Paying off my debt these last five months has led me to a whole new money world. I know so much more about EVERYTHING. Debt, credit cards, credit scores, investing, IRA’s, early retirement…I know so much more about them! I still have a lot to learn, don’t get me wrong, and I have a lot to do on the investing front, but at least it’s a conversation I can have now. It’s like I’ve learned a new language. A year ago I wasn’t even aware people spoke like this. Now I can get by in a conversation with some hand signals and a basic grasp of it. I feel empowered and excited about growing my money in the future and I feel secure in knowing I’ll be debt-free this year. It’s beautiful. It’s powerful. It’s freeing.
So, without further ado, let me share with y’all the steps I’ve taken this month towards that freedom:
Total Paid in February- $1,224
I’ve been concentrating all extra payments on my Stafford 2 loan:
February starting balance: $2,567.90 Interest Rate: 5.35%
February payments: $1,059
New balance: $1,515
Where does that leave me overall? I’ll tell you! My total debt left is $10,290.
I was able to do a little less this month simply because of how my paycheck timing has worked out. I will be receiving a check this Friday for catering and my first coaching check won’t come until the first week of March. So while I’ve been putting in a lot of efforts on those two fronts, due to billing cycles, I haven’t seen returns yet on them. I know this means that next month I’ll be able to do more though. I’m hoping to clear that Stafford 2 loan completely in March!
It’s also so exciting to be so close to being under 10K! In just a few weeks I will be in single digits! (Sort of. You know what I’m saying.) I can tell it’ll feel so much more doable when I only have $9,000 or $7,000 left. It will still take me months to pay off, but I’ve already won the mind game. I already feel capable of crushing this debt. And that’s exactly what I’m doing, month by month.
One resource that a ton of people have found helpful is Dave Ramsey’s The Total Money Makeover. Not everyone is a fan of Ramsey – a lot of people think he moralizes too much – but he is astoundingly popular and his views getting of out debt using “snowball” approach (e.g. paying off your highest interest debts first) have helped hundreds of thousands of people, so if you’re serious about getting financially healthy the book is worth reading. You can get it on Amazon for under 20 bucks, or at your local library or bookstore.