I’ve realized that I have yet to really lay out my loans for the world to see. I always like seeing these posts on other people’s blogs. It makes you feel like you’re not alone with your debt. So today I’m going to show everyone how much I owe, where I owe and what I have paid off so far.
Remaining loans:
Stafford 2: Original balance: $5,500.
Remaining balance: $3,815.11
5.35% interest
Stafford 3: Original balance: $5,500
Remaining balance: $4,185.83
4.25% interest
My CampusLoan
Original balance: $7,302
Remaining balance: $4,765.64
5% interest
Total debt: $12,766.58
Loans I’ve Paid Off
Oct 24th, 2014– Paid off first Navient loan.
Original balance: $3,500
6.8% interest
December 22nd, 2014– Paid off second Navient loan.
Original balance: $3,500.00
5.75% interest.
Looking at all my numbers now, the main thing that comes to mind is “Why did I take out a loan for $3,500? That’s nothing!”
I wish I had understood more about what I was getting myself into when I signed up for my loans. I knew I would have to pay them back someday, but I didn’t understand interest or have any idea of how long it would take. What bothers me about my debt now isn’t so much the paying of it (though I do think higher education is grossly overpriced) because I think personal responsibility is really important.
Update for 2017: Hey all! It’s been a long time since I’ve updated this post but I wanted to let you know where I’m at with my loans. In the last two years I only have about $4k left in student loan debt. I have paid off all of my private student loans, which was relieving. These loans typically have much higher interest rates and fewer benefits than federal student loans, if you weren’t aware, so I attacked those first. As for my federal student loans, I am continuing with my debt avalanche method. With this, I pay off my highest interest rates first. So I am almost finished paying off my 5.35% interest rate loan and will soon switch over to my 4.25% interest rate loan. Has anyone else used this method? Let me know what you think about it in the comments below!
The fact that I, like so many very young people was basically hoodwinked into this debt and taught nothing about how to manage it bothers me. We are given no tools or education on managing money in this country. We learn nothing about money, finance or debt in public education, leaving it up to our parents. Parents who may or may not have any knowledge to give, depending on what their money situation is. It’s a vicious circle and one where being in debt is seen as a normal way of life. It doesn’t have to be! I look forward to getting myself out of this debt and being debt free for the rest of my life.
By the way, if you’re looking for a good resource on the basics of paying off debt, a lot of people are saying Dave Ramsey’s The Total Money Makeover is a go-to source for paying off debt. The book has sold millions of copies and helped hundreds of thousands of people, so his perspective has some value – check it out if you get a chance. It sells on Amazon for like 16 bucks, or you can get a copy at your public library.
Kara Perez is the original founder of From Frugal To Free. She is a money expert, speaker and founder of Bravely Go, a feminist financial education company. Her work has been featured on NPR, Business Insider, Forbes, and Elite Daily.
Paying off two student loans in the same year is a fantastic milestone. Every time you write that last check, you underscore your success. You know you are on the right path and that you are making huge leaps in progress. Great job, Kara.
I’ve been doing some research for the 60th anniversary of my company. The changes in attitudes about debt over the last 60 years is amazing. People used to be ashamed to be in debt at all much less to struggle to make their payments. Now, as you point out, being in debt is considered the norm. Bankruptcy has no real stigma any more.
Your comments about the lack of financial education in our country are spot on. We’ve now raised two generations of kids without any proper financial education and skills. No wonder so many people are struggling with debt.
On the positive side, bloggers like yourself are spreading the word and setting good examples. Thank you.
I know that my family taught me very little about money, besides that savings was important. Nothing about retirement, interest accrual, how debt affects you long term…it’s very sad how normal debt has become. I hope other people are as ready to learn and change as I am- that’s how we’ll get out of this mess!
One of my great wishes for my daughter is that she won’t take student loans. We are saving what we can, but beyond that we are trying to show her how to make choices with the budget you have.
The challenge will be that we have an affluent school district where it is fashionable to go to expensive fancy schools.
I really respect and admire that you’re trying to instill financial know-how in your daughter! Honestly, I think having under 10k in loans is fine for a new graduate- loans are a great way to build credit and 10k can easily be paid off in one year on a salary of $23,000. I always try to think about my long term goals vs my short term goals and I recommend the same for you. Does she need to go to a fancy school (I did! And I do not feel it’s paid off!) to impress people NOW or should she choose a more reasonably priced school and see a better return on investment for the rest of her life?
[…] was to pay off my remaining student loan debt. I gave myself a deadline of February 2016. I had just over $12,766.58 left to pay, but in 2014 I had only made $15,000 total. I knew there was a small chance of paying off all my […]