We are oftentimes told that student loan debt is the only good debt there is. Why? It means you made the financial investment to pursue an education that, if all goes according to plan, will pay you back in no time. In other words, furthering your education is 100% worth it. Hear it here first that there is no such thing as good debt. Debt is debt and it's agonizing if you don't get rid of it. Stop kidding yourself, please.

The truth about student loan debt. My story

After school, our (my wife's and my) student loan debt amounted to $103,000, and this was for our bachelor's program, not master's. I finished my degree, my wife didn't because she couldn't afford the rest of the leg of the B.A. trip. Interest rates would have been sky-high; unfortunately they weren't fixed. There was no other choice but for her to discontinue with school. Still, $103,000 resulting from one finished degree that took 3 years and one unfinished degree that took 2 years... yikes. What's more, we had completely bought the lie that student loan debt is normal. But just because it's normal doesn't mean it's something you should succumb to. Like many who are in denial about this type of debt, we did though. After my wife and I got married, we'd throw money down at expensive restaurants (yep, we're foodies), we'd rack up high-priced receipts at the grocery store and then go home and make Food Network-type meals, where you have to buy at least 20 different ingredients, which includes saffron, to make one meal. All of this added up. Meanwhile, our student loans sat at receiving the minimum payments. At this rate, we'd be paying off our student loan debt well into our 40's. Folks, that isn't life. That's slavery. Something needed to change. Then we got smart.

We hatched a pay-off plan

With some help from some financially-adept authors, we worked at creating a very tedious Excel spreadsheet, a "snowball" plan that would lead to financial freedom if we decided to follow it. It wasn't fun. We had to say goodbye to living a more affluent lifestyle, something I desperately wanted in order to feel like I "made it" in the world. In terms of cutting back, we weren't anything like the types of people documented on TLC's "Extreme Cheapskates", but it was humbling just the same. Packed lunches featuring soup or a sandwich as the entree. Fixed and strict budgets for gas, grocery, and leisure. And absolutely no more Food Network meals. We were already at basic one cable and internet, but more needed to be done to stay on track. The more we cut back on the "above the means" finances, the more we were able to throw at our student loans. We even left our cushy apartment for a smaller sized one within our complex. First world problems, right? Maybe. But for anyone - poor, middle class, wealthy - it's hard to let go of what you're used to.

The following comments and questions plagued us from 2009 to late 2014:

"We can't afford it."

"Is this a want or a need?"

"Honey, we went over again. We need to be careful."

"Did you cut out coupons?"

"I hate Peanut Butter & Jelly."

The day that it was over.

October 28, 2014 was the date of our final loan payment. The picture I took of the last written check is sitting in my phone to serve as a reminder of this milestone achievement. A couple days later, we did a happy dance. Here's the video:

If you watched the above, this is financial freedom being expressed in the form of some very awkward dance moves. And it's what I think everyone wants to experience when they are finally rid of their debts, student loan debt or otherwise. It took us close to six years to pay it all off, and the quest had no shortage of frustration, feelings of unfairness, and at times complete and utter hatred for the college education system. After all, who wouldn't be upset if you couldn't qualify for financial aid (based on FAFSA), receive scholarships, or didn't have the financial support of your parents to get you through it. Suffice it to say, under these circumstances, student loan debt is nothing but invasive of your after-school enjoyment.

The good news: you don't need to buy into the lie

The notion, "everyone's doing it, so why don't you?" couldn't be more appropriate here. Just because everyone is in debt from their student loans and are making the minimum payments doesn't mean you have to follow suit. Get rid of it. As Dave Ramsey says, start living the life you don't want now so you can live the life you do want later on. In other words, throw as much money at your student loans as you can. Treat it like a 401K; invest in it until it hurts.

As a result of paying off our student loans, my wife and I are now able to put money into things that matter. Non-profit giving. People who need a helping hand. And savings. Lots and lots of money has been put into savings for when we're ready for long-term investment planning. After paying off the debt, our desire to live the foodie life also changed. At this point, all we're working toward is eating healthier as we get older, and that type of lifestyle can't be found at a five-star restaurant.

And so I leave you with this... tips on how to break free...

  1. Create a snowball plan - list out all lenders, the amounts you're paying, the APR, and how long it will take you to pay off (years, months) based on the payment you're sending in currently. NOTE: First factor in your income and living expenses to make sure the plan will work. If you want to be really aggressive, set fixed budgets for gas, grocery, and leisure and stick with those.
  2. Tackle the highest and variable APRs first - We tend to forget about fixed vs. variable and head right to the highest-posted APR. There is one exception to not going after the variable amount first: if the fixed amount is higher by a couple percentage points. Just know that the variable one has no shortage of climbing.
  3. Once you've paid off one loan, throw all the money from that loan at the second-highest loan. Rinse, repeat.
  4. Continue to revisit the plan and adjust as necessary. No doubt that circumstances change over time. For example, perhaps you got a new job that is paying you more money, which means you have more money to put toward your loans. Remember to revisit the plan so you can account for that! You'll then be paying off your loans sooner than you originally planned for. That's a really exciting discovery, by the way.
  5. When you've paid it all off, do a happy dance. Jump up and down. Scream. Go bungee-jumping even. Celebrate the feeling of being free.
  6. Tell everyone you know and love that student loan debt sucks. Encourage them to get rid of it.

Thanks for reading,

Tim