Debt Free

How long did it take two InterVarsity staff workers living in the mid-west to pay off approximately $35,000 (plus interest) in student loans during a recession?

4 years and 7 months to be exact.

To be honest, I can’t believe we finally paid them off. When we first got married we decided we would try to pay off the loans in 5 years. At the time, that seemed like an almost impossible goal with one of us working only part time for 3 ½ of those years.

Overall, it’s been an interesting experience trying to pay off the loans in 5 years. Here are a few things that we learned along the way.

1. It really is better to attack loans sooner than later. The first year and a half of our marriage we were only paying the minimum on the loans. It was kind of a shock the first time I did some math and realized that if we continued doing that we’d be paying off the loans until 2030 (or until we were 50 years old). Who wants undergrad student loans still when you’ve well past your mid-life crisis?
2. It helps when both of you are committed to the same financial priorities. I can’t tell you how many financial arguments we had two years into our marriage as we tried to determine which priority was first: paying off the loans, building savings, buying a new camera each year, buying a house. Once we settled on paying off the loans in 5 years, pretty much any other financial decision fell in place.
3. Even on a staff budget, there were still lots of “extras” that we could sacrifice. Only having one cell phone, going with a slower/cheaper internet plan, not going out to eat, renting out our extra room, buying just essential clothing, only owning one car, not going out to Cali for every holiday/or taking big vacations, giving up weekends to work extra jobs…just to name a few.
4. The tempation to give up and go back to just making minimum payments was stronger than I thought it would be. There are so many "things" that seemed to pop up out of no where saying "you need me" or "go ahead and splurge just this month". It really helped being married and having that accountability and person to ask "do we really need that?"  I admire people who are single who can stick to a budget and plan like this without any accountability. I don't think either of us could.

I consider ourselves lucky that we had only $35,000 in school debt. Compared to so many others who are graduating these days, $35,000 was nothing and we thankfully had jobs in this economy that enabled us to make payments. I know many others have much more debt, can’t find work, or jobs that don’t pay enough to make more than minimum payments.

In short, we are very excited to get our February pay check and not hand over any money to our friends at Citi Bank.