There’s been an exciting trend I’ve been seeing on social media lately: suddenly, I’ve seen a few people posting that they’ve paid off their student loans! These are not younger friends of mine either- they’re people in their thirties (or even forties) who have paid off their undergrad student loans after years of effort.

When I wrote the first part of this post: So I Paid Off My Student Loans- Part 1, I described how amazing it felt to finally get rid of the loans that had been hanging over my head for years. The last ones didn’t even have the craziest highest interest- I perhaps could have paid the loans slowly for god knows how long (though my minimum payment was $850 a month!) so it couldn’t have been forever, but I personally couldn’t deal with the debt being in my life any longer. It consistently bothered me to have these stupid payments every month that were so high, where I didn’t feel like I was getting a return anymore- I graduated college 12 years earlier! Some people are fine paying small payments towards their loans for a long time- and mathematically, it may even make sense to wait. But for me, that didn’t work- I was too anxious about it. It’s been 10 months since I made the last payment on my loans, but it still feels like a huge rock has been lifted off my back. It was a goal I had for so long, and I had to work really hard to pay them off. it’s weird to actually have accomplished what was such a monumental goal in my life for so long.

Below, I want to account for how I did it, and how it can be done, and that it can be done! You can use these strategies to pay off any kind of debt, including credit card debt! I know it may seem impossible right now. And it may feel devastating to even look at the debt- I know it did for me. And it’s definitely unfair how much debt young Americans end up taking on in order to go to “a good college” in this country- it’s horrible. But that’s a post for another blog.

I paid off these loans while never making more than a bit over 50K a year, and for many years in my twenties, I made less than 30K or even 25K a year! 😦 Remember, I was a drama major. I directed and acted in numerous plays basically for free for a few years  after graduating college (which took up a lot of my time but paid next to nothing). So I don’t think paying off loans is necessarily about making a lot of money (though it helps, duh! I’m a huge making money fan, Universe!), but it’s more about diligence. Of course, if your debt is really high (300-500k) and you can possibly get debt forgiveness (I was not able to), that’s another strategy, or even bankruptcy might be a possibility to look into (I also would not have been able to get rid of my debt that way)- although most student loan debt can’t be discharged in bankruptcy. Other than those ideas, here are some tools and practices I used to help make my zero student loan debt a reality. Hope they help!

1. Pay more than the minimum when you can. I made very little money while paying down these loans, but by using some strategies I’ll outline below, every little bit of money you can save and add to your monthly principle payment helps.
2. When you get paid, take a certain percentage out of your paycheck and pay it- as extra- towards your debt. You can pick this percentage, but it helps to pick a percentage, because it’ll stop decision delays about how much extra to contribute, and it stops the fear that you’re contributing extra before making money- only contribute extra money after you’ve gotten paid.
3. Automate your payments. Sometimes companies will lower your interest or payments if you automate paying everything. I automated my minimum payments, and saved a bit of money just from that simple step. Plus it helps you make sure you’re not late on a payment, which can really hurt your credit.
4. Make sure any extra payments you make go towards the principle amount of the loan. When I paid extra money towards my payments, the loan companies always tried to apply it to future interest payments, or the next monthly payment. Do not let this happen- it’s a trick so that they’ll get more money in the long run. Make sure any extra money you pay towards your debt goes towards the PRINCIPLE amount. You’ll save money that way.
5. The Goodbudget app. I’m not a huge fan of making budgets- I just know I won’t stick to them dollar for dollar. I was never that into following rules- I’ve always been a bit of a rebel. So I use what is instead known as a backwards budget. This entails tracking every dollar I spend as I spend it- basically writing down where my money goes, and which category I spent it in. This app tracks everything simply and easily, and I’m a huge fan. I wrote a post of it called The Anti-Budget Budget In Your Thirties.
6. Dave Ramsey’s extreme money saving strategies. Dave Ramsey has a really good finance podcast that I highly recommend where he recommends extreme ways to save money. I don’t agree with everything he says, and he’s very religious while I’m not, but if you get past his southern Baptist personality style (or maybe that’ll resonate with you, in which case you’ll LOVE him), he has some great, though simple ideas.  The main idea I took from him is to eat at home and bring your lunch to work as much as possible. Also, while eating at home, he recommends ‘rice and beans, beans and rice.’ Basically, the cheapest foods available, while still being healthy. I didn’t necessarily eat only rice and beans while paying down my student loans, but I ate at home a heck of a lot more, and cooked food in hotel rooms while traveling for work, instead of eating out and spending more money. And I bought cheaper groceries a la the rice and beans strategy.
7. Don’t make yourself miserable. I took a balanced approach to paying off the loans, and didn’t make myself absolutely miserable for a few years in order to do so. Basically, I avoided a completely extreme approach, which saved my sanity and enabled me to stay on course as opposed to giving up on the goal. When I wanted to have a drink out with a friend on the road, I had a drink out- because bonding time with friends is something I cherish, and trying new drinks and food is also up there on my “what makes life worth living” list. Everyone will have their own favorite things, so pick and choose what you absolutely cherish, and do a few of those things, as opposed to throwing money into the hole of “stuff” you don’t care about. Eating out costs a lot of money that can be instead saved and put towards debt, so I ate out a lot less. But I didn’t completely stop eating out. I was just choosy about when I ate out and for what reasons (bonding=good, new food=good, lazy eating out because I don’t want to cook= bad… when I didn’t want to cook, I quickly threw pasta in some water and  heated up some frozen vegetables or something quick and easy. Or I cracked a can of soup or ate cheese and crackers if I was feeling reallyyyy lazy. )
8. Work on other financial goals at the same time. This is not for everyone- some people want to focus singlehandedly on killing their debt, and are willing to forsake building wealth at the same time in order to do so. However, I really didn’t want to wait before opening my retirement account and contributing to it. The more time retirement money has to grow, the more money that you will have. So I contributed money to my Roth IRA at the same time as paying down the debt. It didn’t have to be much. It was just whatever I could spare. Then, when the debt was finally paid off, I actually had a small retirement account already going and building interest!

I completely understand how debt can feel, and I hope at least some of these tips have been helpful to you. Please write to us if you’re confused about any of them, or if we can clarify in any way.