the road to financial freedom
November 5th, 2007 @ 7:49 pm | Comments
Filed Under: life, nablopomo
There is nothing I hate more than debt. Now, I know that some debt is necessary- a mortgage, for instance. I know we’ll pretty much always have a house payment to make, at least until we’re old and gray. It will probably be a long time (if not forever) until we’re able to pay cash for a car. And of course there are the other smaller bills we’ll always have: electric, gas, water, cable, cell phone, etc. But other kinds of debt- credit cards, other miscellaneous loans- HATE. I hate having things that automatically take a certain amount of money out of our bank account each month, no matter what.
Which is why I am super duper excited right now.
I just paid off my student loan. Something like 7 years earlier than scheduled. It’s gone. It started at just under $25,000 when I graduated 6 years ago, and a few days from now when the bank transaction goes through, the balance WILL BE ZERO.
Several people in the financial world have looked at me funny when I stated that paying off our student loans was our first priority when it came to our money (after things like our house, food, diapers, etc of course!) And I think that’s because most people have those nice government loans with locked-in low interest rates. But us? We’ve got goofy private loans with variable rates, because Grove City refuses federal funds and therefore goes its own route for student loans. Which, hey, I get it. Tell the government to stay out of your business, you can do it yourselves. That’s cool. But when we graduated, the rates were a nice, low 4 percent. But slowly in the past couple of years, they’ve climbed to new heights. Like, 8 percent. EIGHT FRIGGIN’ PERCENT? Ouch.
Plus, we were paying out a combined total of $550 each month to just meet the minimum payment requirements on our loans. To me, that was painful to see. I would MUCH rather see that going into savings or heck, even going into something better than EDUCATION. Like shoes or makeup. (I’m kidding. Kind of.)
So we made getting rid of these loans a financial priority last year, when both cars were paid off and we found ourselves with some extra cushion each month. Mine was first- it was smaller and therefore was going down much faster. So I started paying twice the required amount and enjoyed seeing the ‘Amount Applied to Principal’ column increased each month. Then I’d get a decent-sized check here and there from websites I’d finished, so I’d send a chunk of cash here and there. Soon it was down to almost a quarter of where it started. Almost there!
This month, financially speaking, was a very good month for me. So instead of running off to the store (or the internet, since I like to do most of my shopping from my couch these days!) I decided to send the amount in the ‘To Pay This Loan In Full’ column. I’ve been waiting to pay that amount for a very long time.
Next up, Dan’s loan. Our goal is to have his paid off by next summer, when we’re pretty sure we’ll be sick of trying to cram the three of us into my little Honda Civic. And getting this out of the way now is going to pave the way for all of the things we’d like to do in the future- more kids, a new house, vacations, setting up college funds for our kids (even though they’ll still probably need loans of their own since one semester of college will probably cost A Bazillion Dollars Plus a Kidney by the time they’re ready for it)
What a super fantastic day.
More posts like this:
- the numbers don’t lie February 16, 2007
- I tried to find an NKOTB lunchbox, but they didn’t have any. August 10, 2008
- more on the bank thing August 7, 2007
- grownup survey March 21, 2007
- good and bad: this week so far August 26, 2008
November 5th, 2007 @ 8:26 pm
Oh, I hear you. Jon has a student loan, I have a student loan. I have three kids, I got greedy and bought a new house. I want those PAID OFF. UGH. I was thinking about going back to school and then Jon was all, “More student loans?”.
November 5th, 2007 @ 9:48 pm
Jen, good for you!! I am excited for you. I LOVE paying things off. Heh. :)
November 5th, 2007 @ 11:05 pm
congrats!!! I hate hate debt too (which is prob why my mortgage freaks me out if I think about it too much). That must feel SO good! Do you read Michelle Singletary’s columns? She writes for the Wash Post but it’s syndicated all over. She preaches being debt free and I love reading it.
November 5th, 2007 @ 11:22 pm
YAY! That is awesome!!
George and I were lucky, both of us had full scholarships as undergrads, so we didn’t have that to pay back when we were just starting out. But starting next year we’ll have to pay back his law school loans, so I hope we’re able to be as diligent as you guys about paying it off!
November 6th, 2007 @ 12:20 am
YAY way to go Jen…congratulations!!
November 6th, 2007 @ 8:21 am
Wow, congratulations!!!
November 6th, 2007 @ 9:34 am
That is something to be proud of! There are so many people that are not responsible when it comes to $$$ and will only pay the minimum amount that’s due! Now you’ll have a little extra cushion laying around (once Dan’s is paid off, too). Yay! That sounds great! :)
November 8th, 2007 @ 11:22 am
Congratulations! That is very inspiring, Jen!
I detest debt and paying off my student loans was my #1 priority when I finished school. I’ve been putting off getting an automobile because the thought of being in debt again is scary…but a car and a house are acceptable types of debt so that’s good.
Wishing you all the best as you work to pay off Dan’s loan.
November 8th, 2007 @ 2:14 pm
Congratulations! I just mailed the last check for our car over the weekend–paid off two and a half years early–and I am tickled pink over being able to use that money for other things!