Student Loan Project: Change with Our Payments
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It's been a month since I shared our progress with the student loan project.
We have one student loan between us and its our only non-mortgage debt left. It is time to focus on paying it down faster.
I’m using any after-tax revenue generated from My Financial Reviews to pay down the student loan faster.
The idea here is that money is sent out almost as soon as it comes in.
We're Scheduling Payments Now
So last month I mentioned that the extra $1,000 we put towards the student loan pushed back the required due date for the next payment until this fall.
I had assumed that the automated payments would still be withdrawn from our account. When we had a car payment that's how it worked.
I was mistaken about the process. When I went to check on the joint account, I noticed that April's payment hadn't been taken out yet.
That means we have to automate our payments from our end. It's not a problem, just a bit unexpected.
The bright side is if our budget changes dramatically we have some leeway with the student loan.
Chugging Along with Extra Payments
Not much to say this month about additional payments. Right now an extra payment is scheduled for tomorrow for $100.
My plan for May is to work harder on decreasing monthly expenses. My main focus will be cutting gasoline expenses by 25% and keeping our food expenses below $350.
Stay tuned next Monday for the Fuel Challenge announcement. I thought it would be fun to make a contest with saving money.
Since we got our cable bill lowered (verified by the bill we received yesterday) I'm reallocating the money saved towards paying down the student loan.
Thoughts on Paying Down Debt
I’d love to hear from you about your financial goals this year. How many of you are paying down debt? How is it going so far? What has been the biggest challenge?
One of my big goals for the year is to get rid of my smallest student loans. The balance isn’t that high, but it means I have to save less money so I guess my biggest hurdle is balancing cash savings vs prepayment and finding a groove
Yeah, Evan we’re trying to stay balanced as well. I’m hoping that income will increase from my other site so we can speed up the student loan payments.
Congrats on the progress. Our financial goal this year will be to build up a nice cash cushion in the next 4 months so that we won’t have to worry as much when we have to hand over more than $50,000 for the 20% down on the house we are having built. We’ll still worry, but not as much, lol.
Glad the two of you are working the home goal together! You can’t get rid of worrying, but lessening it is nice 🙂
Paying down student debt can be daunting at times, but setting up automatic payments is by far the best way of doing it. Looking forward to the fuel contest.
Thanks Jeremiah; hoping to get rid of this debt sooner rather than later. We can then use that money for other goals (financial and otherwise)!
We’re still working on non-mortgage debt as well, and I need to set a focus for groceries. I used to be so good about sticking to a list, but lately my grocery bill has been high! Definitely have to get back to shopping sales and sticking to a list!
Good luck with your loan! I’ve been doing the same thing with my car, and it has worked out well so far!
Good job with your expenses! I’ve already achieved my main goals of refinancing my house and car down by $100 and $25 per month. With the rates so low, I’m now applying the theory of leverage by investing the money rather than using it to pay down debt. For example: Buying index fund shares that may return 8% rather than pay down my car loan at 2%.
We paid off the last of our debt one year ago. It’s very liberating!
Student loans are very stressful for me because I can’t afford them. They’re such a racket because there’s no insurance you’ll find a job that pays enough for you to afford to pay them back. I hope I find a job that leads to making enough money to pay ALL of my bills.