Facing a desperate situation – a six figure student loan debt with no six figure income – I did what many graduates do at first.. I ignored it. I decreased my spending enough to make slightly more than the minimum payments. In some months I relied on the credit card float and then paid it off in others with tax returns or bonuses. I never felt like I had enough money to get through the month. I tried to budget and almost always failed to stay on track. I felt like I was waiting for this ten year sentence to end so that I could finally just start from zero again.
I want my life back. Please tell me … how much is enough? How big does this pile have to be?
I spent the first year of my debt repayment journey tracking my spending and pretending to budget. I made $15,000 in payments to my debt that year, and at the time I felt proud of that accomplishment. I’d paid about $800 more than the minimum payments, which seemed like great progress.
At the end of the year, I had to calculate the interest I’d paid on my student loans for a deduction on my tax return. Out of $15,000 in payments, the interest totaled almost $5,000. FIVE THOUSAND DOLLARS. Just in interest. To this day, I have a vivid mental image of throwing stacks of bills on the ground and setting them on fire.
It all hit me then, harder than ever before – I was staring down another ten years of payments, and another $20,000 in interest. I was making an average salary for my city, but I was struggling somehow.
At the beginning of my second year of payments, I knew I had to make some major changes. I was ready, but I wasn’t prepared.
I’m a relatively privileged person – I’m white, educated, and I was always encouraged to be productive. When it came to money, I started out well behind the curve. Money was never something positive during my childhood – it was something you needed, something you fought about, and something that you earned somehow but that disappeared somehow. Our house was always ringing with the noise of money fights – I’d lock myself in my room with headphones in for hours to find some quiet. My parents always made sure we had enough, and I’m grateful for the way they provided for me and pushed me to succeed. I was just missing the money framework that seemed to come so naturally to others.
I knew generally that frugality was beneficial, that you should live within your means, that you shouldn’t take on debt, that you should save for retirement. I knew the theory, but I didn’t have the practical skills. I didn’t know how to budget properly, or what you should do if your numbers weren’t working out. I didn’t know how much more prepared food cost, or how to cook inexpensive meals at home. I saw how others were spending their money, and I emulated it. I thought I just needed a higher income.
The moral of the story is: I chose a half measure, when I should have gone all the way. I’ll never make that mistake again.
There was one thing I did know – my plan wasn’t working. I needed to find other plans. When I searched for resources, there was one name I kept running into over and over: Dave Ramsey. At first I was skeptical, particularly about taking advice from a person who was so opposed to some of my major values, but I decided to be an adult and listen to the plan – even if I didn’t fully agree with the personality behind it. I started listening to his podcast on my commute, and I listened for the full three hours every single day. I haven’t missed one episode in an entire year.
Every month another lightbulb went on as I listened to all of the debt free screams and the millionaire calls. I started doing the math on how much my debt was costing me every month. I compared prices on groceries. I used habit trackers to mark days where I spent $0. I did challenges and experiments. I went 100 days without any meals out. I stopped buying clothing for a year.
Every month I felt a little more confident. I went from making $40 in extra payments every month to $280, to $700, and now to $1,200+. This wasn’t a switch I turned on that suddenly gave me the skills and habits I needed. This was a constant daily struggle to overcome more than a decade of ignorance.
Dave Ramsey gets a lot of love, and a lot of hate. I’ll just say this – if you’re privileged or lucky or educated enough not to need his help or understand why others do.. just be grateful for that and shut the fuck up, okay?
It is not easy to budget and follow through on that budget if you’ve never been shown how to do it correctly.
It is not easy to meal plan and buy groceries with a list if you’ve never been shown how to do it correctly.
It is not easy to defer your desires and save for things instead of paying with credit if you’ve never been shown how to do it correctly.
For some reason we treat managing money like an innate human ability and if someone isn’t successful at it right away it must be because they’re lacking in intelligence or willpower or strength of character. We should be treating managing money as a necessary skill that some of us were just fortunate to have mastered early on.
If someone’s trying to learn how to swim, you don’t just show them a chart and tell them how obviously easy it is. You wade in. You instruct them to float. You teach them how to tread water. You demonstrate different techniques. You get in the water with them and show them how to splash around for fun. If they’re drowning, you don’t shout physics equations or insults or misplaced words of encouragement from the deep end like a total sociopath. You jump in the water and help them, or you stand quietly to the side while the lifeguard helps them.
You clearly don’t know who you’re talking to, so let me clue you in. I am not in danger. I am the danger. A guy opens his door and gets shot, and you think that of me? No! I am the one who knocks!
Coming up on two years of this journey, I’m not the same person I was before. I’m not at the mercy of a bank. I don’t nervously log in to my accounts after avoiding them for weeks. I’m not afraid to check the mail. I don’t panic at the thought of an emergency. I’m the one who knocks now. I say when I’ll be paying this debt off. I say how much I’ll be earning. I say how much I’ll be paying in interest.
I didn’t start with this confidence – it grew as I learned how to manage money, month by month. I’ve cut my spending by thousands of dollars per year. I’ve received raises and bonuses, and directed most of that to my debt too. I started a side hustle to shorten my timeline even more. Instead of $15,000 in payments, I’ve doubled that to more than $30,0000 this year.
I plan to pay off my debt in 2019 instead of 2026. That’s more than SIX YEARS of my life that I’ll get back because I started to pay off this debt faster. If you saw my spending from last year to this year, you would swear they belonged to two entirely different people.
The best part? It wasn’t a sacrifice.
I did it for me. I liked it. I was good at it. And I was really — I was alive.
It’s amazing how much we can adapt. When I started to make changes, the first few days and weeks were tough. I wanted to quit. I relapsed occasionally. I made mistakes. I overspent. I caved. I stumbled.
It was all worth it.
The truth is that I feel happier and more content now than I ever have in my life.