Author Topic: Paid Off the Last of Our $75k Student Loans Today  (Read 3145 times)

Jesse@Papermonger

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Paid Off the Last of Our $75k Student Loans Today
« on: January 31, 2019, 01:41:52 PM »
First off, hooray! The intent of this post is not to brag, but to give hope to those who stare bug-eyed at MMM's sprint to retirement and are not progressing as rapidly as he did.

I graduated college in 2010 with a degree in elementary education. I lived and worked in a LCOL city, and out of necessity I adopted pretty Mustachian tenets right after graduating (looking now, I see my first comment was in Dec 2011). Like many people in my generation, no one ever sat me down and gave me a frank talk about what an appropriate amount of student loans should be. Also like many people in my generation, I'm not sure I would have listened anyway. Upon graduating, I had $75k in student loans.

My wife graduated two and a half years later (her parents paid everything for community college if she'd live at home), and we've consistently made about the same amount since (~$30k each in 2013, increasing steadily to ~$50k each today). We've had only a few gaps in employment and both made minor career changes along the way. We do not have children.

We live in a HCOL area now (which is most of the reason for the higher salaries), but I want to take this opportunity to commiserate with those of you who cannot expect huge raises YOY, especially those whose career areas frown upon job-hopping. With an overabundance of tech workers reading MMM, it can sometimes become an echo chamber of "Why don't you just move somewhere else" or "Use your skills in a different job" without acknowledging the real roadblocks some people face. I totally get it!

I feel very happy that we chose to pay off our own student loans rather than rely on a government program or debt forgiveness, which many of our friends are choosing to do. We are the oddballs for driving reasonable cars, biking to work, and limiting restaurant eating, but we respect ourselves and our choices enough to keep at it. At 32 and 30 years old, we feel like we've "made it" financially, even though our net worth is still in 5-digit territory. We have no debts and a healthy income.

Factoring into the slow progress we've made toward FI are some conscious choices that we made at the beginning of our financial journey. We feel very strongly about our faith and have always given 10% of our net income to transparent charitable foundations that we believe in. This might seem like a lot to those with a strictly mathematical view of finances, but the emotional and mental advantages to this practice have kept money in perspective in our lives. We've also been able to help out family in times of need and not expect anything back. Priceless.

But slow and steady is winning the race! I know it's hard to see sometimes when you're at the beginning of the FIRE journey, but here's what I mean: When I graduated and was substitute teaching to get my foot in the door of a school district, my savings rate was a measly 3% (even living with family)! I remember reading MMM articles after an exhausting day of teaching for less than minimum wage and feeling like it was all I could do to not walk over to Chipotle "because I earned it." I drove for Uber nights and summers, worked at a summer camp, and delivered for Amazon in spare moments.

After paying off our student loans today, our savings rate is now around 55%, and we both work around 32 hours/week. What a huge difference 8 years made!

The best advice I can give to other Mustachians still on the journey to FI is this: it will pay off. Maybe not today or this month, but a step in the right direction is one less step that you'll need to take later down the road. Like MMM mentioned in the article "Are You Giving the Shaft to your Future Self," those gifts arrive on the conveyor belt far before you actually reach FI. Every day that I wake up not stressing about money or losing my job, I silently thank our 20-something selves for having their shit together. Feelsgoodman

See you at the finish line!

ParkwayD123

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #1 on: January 31, 2019, 07:53:25 PM »
Well done!

naj89

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #2 on: January 31, 2019, 08:18:19 PM »
Great work! We still have some student debt we are chiseling away at, but have paid off some of the higher interest loans. There is nothing better than logging in to the lender's website and seeing "PAID IN FULL"! Keep it up!

Budgie

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #3 on: January 31, 2019, 09:33:39 PM »
Congratulations! You should be proud of yourselves :)

iris lily

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #4 on: February 03, 2019, 06:56:31 AM »
This is cheerful news, so glad to hear it!

FIREby35

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #5 on: February 03, 2019, 08:00:20 AM »
Awesome! I love the feeling of being debt free. Welcome to the club!

Jesse@Papermonger

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #6 on: February 04, 2019, 12:33:28 PM »
Thanks everyone!

Bartleby_the_Scrivener

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #7 on: February 04, 2019, 08:30:58 PM »
Your story sounds very similar to mine, although our student loan burden was lower. I am impressed. Congrats! I'll never forget the final early payment we made on ours, which made budgeting and saving so much easier. Cheers!

Linea_Norway

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #8 on: February 05, 2019, 02:54:20 AM »
Well done. And even better when it is done while giving away 10% if your net income and working only 80%.

better late

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #9 on: February 05, 2019, 05:42:14 PM »
Congratulations!

Civex

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #10 on: February 11, 2019, 08:39:34 PM »
Congratulations badasses!

NYExpat

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #11 on: April 02, 2019, 06:18:26 PM »
Congrats on paying off the student loans. We experienced the joy of that in March. Paying them off on your own is definitely the way to go. There are too many horror stories of people who thought they were enrolled in the right payoff plans only to find out after 10 years they weren't eligible for loan forgiveness.

Also, kudos for sticking to your convictions about tithing.
I know that you aren't doing it for the back pats, but still. When you're paying off debt or trying to stash away a bunch of cash, it's definitely easy to think how much easier it would be without 10% going out the door. Helping out others too is the right call.

BadCaseOfWonderlust

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #12 on: August 13, 2019, 07:59:16 AM »
I realize this topic is probably dead, but thank you so much for sharing. I'm an environmental scientist and my husband is in the survey field and so we can't move around a lot (plus we really like our jobs). I've been getting really discouraged reading a lot of the blog posts that focus on high income earners when I'm not sure I'll ever be one. It's nice to see that progress can still be made.

Anyways thanks again for sharing.

A Fella from Stella

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #13 on: August 13, 2019, 09:47:35 AM »
So great to read this. Congratulations.

FamilyGuy

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #14 on: September 14, 2019, 06:47:35 PM »
Yes, nice job!

Dicey

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #15 on: September 14, 2019, 07:33:19 PM »
I realize this topic is probably dead, but thank you so much for sharing. I'm an environmental scientist and my husband is in the survey field and so we can't move around a lot (plus we really like our jobs). I've been getting really discouraged reading a lot of the blog posts that focus on high income earners when I'm not sure I'll ever be one. It's nice to see that progress can still be made.

Anyways thanks again for sharing.
I never made over $100k and I got to FIRE. In fact, I only got close to $100k once. More typical was $35-$45K until about the last ten years of my career. You can certainly do it, it just may take a little longer. There are support threads for lower income earners around the forum.

https://forum.mrmoneymustache.com/ask-a-mustachian/any-low-income-mustachians-out-there/ - This one appears to be dead, but reading it might be helpful.

https://forum.mrmoneymustache.com/journals/low-income-group-journal/ - This one's current.

Congrats on paying off your loans!

Jesse@Papermonger

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #16 on: October 04, 2019, 09:33:13 AM »
UPDATE since this situation, like all of life, has gotten more complicated, and Mustachianism is helping.

In the middle of August, my job evaporated due to a corporate restructuring/bankruptcy. I didn't really stress about it because of everything mentioned in my original post. I had been using some of my free time to work on my shoestring side hustle, so instead I scaled that up to a sustainable level (30hr/wk for me). Freedom from W2 life being my goal, I've set a timeline for myself to produce, or go back to a JOB.

A week after losing my job, I was on my daily walk around the block and saw an amazingly-kept low mileage 29' RV for $13,500. After camping for a week, we fell in love. We bought "George" and decided to try our hand at full-timing (living in the RV year-round). We have talked for years about living in a tiny house or an RV, so we thought the timing was good enough. Right now, we love it. We live in paradise on our favorite path, we save $600 a month over apartment living, and my wife says she has "the most beautiful commute in the world" with deer, the Rocky Mountains in the sunrise/sunset, and Devil's Backbone (google it).

If we're making a mistake, we're having fun doing it.

In the spirit of the original post, I wanted to update that our NW increased $14,500 since the original post, and as soon as we sublet our apartment, we will be at a 30% savings rate.

Focus_on_the_fire

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #17 on: October 05, 2019, 10:26:13 AM »
Happy dance, high five. Nicely done

Dicey

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #18 on: October 05, 2019, 12:16:11 PM »
UPDATE since this situation, like all of life, has gotten more complicated, and Mustachianism is helping.

In the middle of August, my job evaporated due to a corporate restructuring/bankruptcy. I didn't really stress about it because of everything mentioned in my original post. I had been using some of my free time to work on my shoestring side hustle, so instead I scaled that up to a sustainable level (30hr/wk for me). Freedom from W2 life being my goal, I've set a timeline for myself to produce, or go back to a JOB.

A week after losing my job, I was on my daily walk around the block and saw an amazingly-kept low mileage 29' RV for $13,500. After camping for a week, we fell in love. We bought "George" and decided to try our hand at full-timing (living in the RV year-round). We have talked for years about living in a tiny house or an RV, so we thought the timing was good enough. Right now, we love it. We live in paradise on our favorite path, we save $600 a month over apartment living, and my wife says she has "the most beautiful commute in the world" with deer, the Rocky Mountains in the sunrise/sunset, and Devil's Backbone (google it).

If we're making a mistake, we're having fun doing it.

In the spirit of the original post, I wanted to update that our NW increased $14,500 since the original post, and as soon as we sublet our apartment, we will be at a 30% savings rate.
You're living a version of my dream! Congratulations! I hope you will post here more often. People love, love, love encouraging stories and you certainly have one.

bmjohnson35

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #19 on: October 05, 2019, 08:18:19 PM »

Congratulations! 

It's so easy to get discouraged when your faced with debt and earning low to modest income.

We need more posts like this one.

BJ
 

Zamboni

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Re: Paid Off the Last of Our $75k Student Loans Today
« Reply #20 on: October 06, 2019, 02:23:40 AM »
Nice work paying off your student loans, and good luck on your current Rocky Mtn adventure!