Getting Out of My Debt: A New Plan (I’ve Had IT!!)

I came to a few realizations last night and I went to bed angry. Fighting mad angry. But in a good way. I owe a lot of this to my friend Dan, who answered a text message of mine that said “Do you think I’m stupid for wanting to leave a good paying job to do something that will pay so much less?”

The reason I asked this question is because I see so many people struggling just to get by and I feel like I should just be thankful for whatever opportunity is thrown my way. For example, there are the cleaners/housekeeping folks at my gym – all three of them work two jobs. None of them have English as their native language, which definitely hurts their job prospects.  I know for a fact that one of them works seven days a week, and that a second one was until he finally had his daughter talk to me to write a note to the manager stating that he would like to take Fridays off since he was working seven days a week. (He and I are slowly teaching each other some words in Spanish and English.)

In response to these concerns, my friend Dan told me, among other things, “you can still be thankful and desire to live a Purpose Driven Life.”  He also said something that struck home: “No one says on their death bed, ‘Thank God I paid off that student loan.'” Finally, “It (my student loan debt) runs your life in that it makes your decisions for you.”

So now, I’m going to do what he suggested: “Find a balance between the obligation you owe the debt and the bigger obligation you owe yourself.”

I looked at my loan details last night for my Big Daddy loan. I started paying (or shall we say, deferring and forbearing) back in 1997. Now that I have been paying interest-only payments on it for the last two years (as part of a graduated repayment plan), just to keep it from growing, I see that the final repayment date is in 2034 and another in 2035 (Big Daddy consists of two consolidated loans – one is unsubsidized federal money and the other is subsidized.)

In case you’re wondering what the difference is between a subsidized loan and an unsubsidized one–well, the difference is when who pays the interest that is accruing during terms when you are not in repayment, such as when you have taken a deferment. Deferments can be for a number of reasons but the most common ones are that you are currently in school or you are going through some sort of economic hardship. With a subsidized loan, the federal government pays the interest coming due. With unsubsidized ones, that interest just keeps on accruing and accruing and accruing and at the end of your deferment or forbearment period, all that unpaid interest gets thrown on the top of the loan, essentially making your principal balance, upon which more interest accrues, even larger than when you started. Do you see why this can get overwhelming to think about? I had loans that were unsubsidized during my first year of law school. You’re encouraged to not work during your first year of law school for  a lot of reasons. So even by the time I graduated my principal balances had already grown by a whopping lot.

My Big Daddy loan actually consists of two loans – out of $75K, one has a principal balance right now of $44K.  So that puts the other one around $31K.  Here’s the funny thing – that loan that now has $44K to its  name – when I consolidated that loan back in 2001, guess what the principal balance was at that time? Yeah….it was about $41K.  All these years, I have paid at the very least $538/month, and for many years, while I was married, I even paid extra principal to it every month. Sometimes, about $700/month, on the combined Big Daddy loan.  So, how, you ask, is that balance even higher? If you take an average of $6000 paid every year and you multiply that by 13, how much do you get?? Hmmm. 78K.  And yet the balance of Big Daddy these days is still over $75K.

So here’s what I decided the other night – I’m going to switch careers to something that I find much more fulfilling, and if I pay less money per month to my student loans, so be it. I want to have a life where I feel like what I am doing every day is more in tune with my heart. And for me, that means working with animals.

Beginning this week, I am going to begin volunteering with the Animal Rescue League of Boston and work with their livestock animals. Right now, that means goats, sheep, a horse, and some chickens. I heard back from my local vet who asked me to send a resume or CV and let them know the hours during which I could volunteer, so I would be able to get experience working in a private vet office with small animals. I want to try to expose myself to as many different types of animals and types of organizations so I can see what best fits with me and my personality, etc.

I already know the average salary for vet assistants is something like $22K-30K. This is about what I live on right now, but I currently pay extra money to my student loans and paying the higher amounts on my loans. With a lower salary, I will be eligible for different types of repayment plans, and one can lower your payments to about 10-15% of your salary. So yes, it moves the final payoff date out that much further into the future, but life is short.

Don’t get me wrong. I’m not a slacker. i do want to pay back my debts. I do. I just think that with all the money I have paid this government over the years, the government can continue to wait for the 2x and 3X the principal amounts I will end up paying back. I could walk outside today or tomorrow and get hit by a car or something worse. I could be like Brittany Maynard who was 29 and found out she had an aggressive form of brain cancer. I’m not trying to be melodramatic or anything. I just have decided to not let these loans run my life anymore. I’m going to start living my life for me. And for the animals.

So this is the new plan. I’m going to pay off the private student loan which is sitting around $13,500 right now. That one, I don’t have tons of options about. But the federal ones…I’ll deal with them, probably for the rest of my life, but at least it’ll be a life that I feel good about at the end of every day. I’m thankful for the opportunities I’ve been given in this world, and every time I go to a talk at my school about animal rights, I get this strong feeling in my stomach that I NEED to do something to help them. And with my background, I can. I want to work with the animals in a hands-on way, but if there’s a way I can also be involved in using my education or my social or personal skills to their advantage, well, I plan on doing it. I’m open to the opportunities.

I’m home with my mom this weekend to celebrate an early Thanksgiving. I hope you will all have a great weekend. If you’ve liked this post, please hit like or subscribe, or drop me a line below.

9 thoughts on “Getting Out of My Debt: A New Plan (I’ve Had IT!!)

  • I’ve read about “student loans”, I’ve heard about “student loans” but until I see the numbers in front of me I never realized that “student loans” are in fact economic slavery. The only way out of one is to pay it off or die, they can & will attach your social security. It’s right there on paper… you are owned by the banks.

    1997 was a long time ago. Live your life or not, it’s like your friend said, on your death bed will the one thing you regret be not having paid back the bankers for that student loan?

  • I feel for you, Terri. I went through the student loan bit, but luckily mine never got as high as yours and my years practicing law took care of a lot of the amount I borrowed (every penny that law school cost.) But you only get one life, and I believe you’re right – you have to live it for you and the animals you love and not the bankers. Best of luck, and I hope you’ll continue to keep us posted.

    • I will keep you guys all posted, Ginny, for sure. And yes, when I got out, the salary I was earning was not nearly enough to help me pay these back. I think I made like $35K, which ironically may be even more than I may make with working with animals. I’ve just changed priorities at this point now. I’m glad you were not so screwed by the loans!!

  • Rob, that’s a “hell no” if I have my way about it. The banks have been paid by me and paid by me and paid by me, for so long. The scary thing is when I talk about that I have paid, that’s only on the Big Daddy. There’s also my Simmons loans and my private loan. The problem with Big Daddy is that when those loans were taken out, the interest rates were high. When I consolidated them, because I didn’t have much other choice at the time, they were still high. Luckily for me, the Simmons loan, even if I try to pay it off at the regular rate, won’t be too bad. The Simmons loans are at 1.67% or so. And yes, my body reminds me every day that 1997 was a long time ago! 🙂

  • You need to do what is best for you Terri. People will judge regardless of what you choose . . . the one person you should look to please is yourself.

    I have a dear friend who just lost his mother after a 3 year long illness. She spent her entire life taking care of other people. This included her husband in the last several declining years of Alzheimer’s. She did this because she felt it was the right thing to do but with a bit of an edge of martyrdom. She fully expected that her only son would give up his life to care for her in the same way. My friend did what he could but still worked and tried to maintain a life with his wife. They gave up a lot of their life to fill in the gaps to care for his mom. No matter what he did it was never enough. When she died there was some amount of relief from the pressure and angst she continually dumped on everyone around her. She felt cheated in life partly because when she was finished caring for everyone else, she got sick and her health slowly declined.

    There are all sorts of ways to serve and give back in this one life we’re given. Why not contribute from a joyous place in your heart, doing something that makes you sing while still setting up a plan to take care of your obligations. Now in my 60th year in life there is less life ahead and more of life behind me . . . it’s pretty sobering and it happens much faster than we’re prepared for.

    Do it Terri, “Go confidently in the direction of your dreams . . . live the life you’ve imagined”

  • Darris, one of the most freeing things to me over the past few years is not caring so much about what others think. It really does give you a lot more freedom.

    That is a really sad story about your friend’s mom. I don’t ever want to turn into that. And I still can’t believe you are turning 60 (wait, did you already have your 60th?) I am definitely finding life is moving much faster than it used to which is why I am working so hard on changing my life now, rather than taking another few years to get it all sorted out. I love that Thoreau quote, thank you!

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