Getting Rid of My Debt, Part 14

My guys above are invaluable in helping me to keep my spirits up. It always amazes me how they can find such amusement in something so simple as a box. 🙂 “Oh boy, it’s a box!”

I mentioned last week that I would talk about how I keep from letting myself feel down about my debt. I try to not think about it in overall, total sums, but rather what I can work on at the moment. This does not mean I am in denial, by any means, but as my grandmother used to say when I would stress out about my debt or other matters, that I shouldn’t make a mountain out of a molehill. Or, I guess in this case, not turn a 20,000 foot tall molehill into Mt. Everest. As weather such as wind and rain gradually wear away at such massive structures as mountains or the Grand Canyon, so will I do so with making extra payments over time. (I just thought of that analogy, what do you think of it?)

To that end, I finally have one of my student loans’ balances down to below $18K. This loan was originally for $42K and some change when I first took it out, way back in the 1990s during law school. God, how I would love to obliterate it.

So, just to recap, and also so that I can feel good about how I’m doing, here’s what my balances were like just about 7 1/2 months ago, at the beginning of September.

Sept. 2013:

Personal loan: $4,211.42
LAL loan: $20,939.94
Simmons Loan: $23,620.04
Big Daddy (federal) loan: $75,390.94

TOTAL BALANCE: $124,162.34

Now, March 2014:

Personal loan: $NADA. Non-existent!!
LAL loan: $17, 963.11  (2.67% interest rate)
Simmons Loan: $23,620.04 (only paying interest right now)
Big Daddy (federal) loan: $75,390.94 (only paying interest right now, rate is a ridiculously 7.5%)

TOTAL BALANCE: $116,974.09

DECREASE in DEBT: $7,188.25.

HOLY CRAP! First of all, until I wrote this down, I didn’t realize I had broken the $117K mark, which is cause for celebration in itself, yay yay yay! That is a lot to have paid down in 7 1/2  months. That averages out to my paying down $958.43 in debt every month. So you know what? I want to challenge myself to now make it an average of $1000 per month. I can do this. I can!  (And it’s actually a pipe dream, but I’ve asked my financial adviser to help me figure out how much I would need to pay down per month if I wanted to get rid of this loan before the interest rates are expected to go up again, in Fall of 2015. I say this because the rate on my private loan is variable, and can go as high as 9%).

For privacy reasons, I won’t go into what is in my savings accounts, but just know that I have also been saving up while paying down. And I’m feeling good about it. Plus, my retirement accounts are slowly but surely growing. For those of you who are out there and in your 20s, and tire of hearing people tell you “if you can just put away 10 or 25 dollars per week, do it,” I’m here to say “LISTEN TO THEM.” Seriously. Time can help you SO MUCH when it comes to saving money for your later years.

When I first got married to my now-ex, back in 2004, he was a year younger than me. But, he had started saving money for retirement in his 20s. I had not, always thinking I couldn’t afford to put any money away, that I needed every penny I was making, just to survive. You know how it is, I know you do.  I truly lived paycheck to paycheck.  But no longer.

Trust me, you won’t miss 10 dollars per week. What does that mean, foregoing a cocktail or two cups of coffee from Starbucks or Dunkin Donuts? Those are wants, not necessities. And if you want to get yourself out of debt, you have to differentiate between the two. You absolutely HAVE to. 

Now, I know I want to make a big lifestyle change, in terms of location, job, living shelter situation-wise. So I need to start living as if I’m in that new lifestyle. That means figuring out what the bare minimum is that I need to live on, and still be able to pay my debts from this lifestyle (READ: student loans).  That tells me what kind of salary cut I could go down to but still live a fulfilling life.  And I put it down on pencil and paper in front of me, so I see it. (I’m a visual person.)  It is heartening for me to figure out those numbers, and realize it’s less than what I am bringing home now. So, I’m living below my means, and that’s what I HAVE to do and what you HAVE to do, to get out of debt and follow your heart.

You also have to surround yourself with people who support you (and when I say, surround, I mean both in real life and online.) I have some good online friends who keep reminding me to stay focused (thank you, you know who you are), and friends who are local and know my goals so they understand when I sometimes decline from doing something that is expensive. And they don’t judge when I talk about either living in an RV or a small house. We cheer each other one (you definitely need a cheering section).

So, I would like to say thank you to all of you who read these posts, take the time to write to me and say words of encouragement, etc., and that I hope these posts can help others stay on the course of getting out of debt.

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