In December of 2012 my wife (girlfriend at the time) and I opened up to you about how much student loan debt we had. As we inch closer to paying off my wife’s student loan debt, we just wanted to give you a quick update about where we are today.
I’m excited to announce that today we could pay off my wife’s student loan debt in full and be done with it forever. We could be student loan debt free today! As much as I’d love to go ahead and get rid of the student loans for good, we won’t be paying the student loans off this month. Why?
While we technically have enough cash to vanquish the student loan debt, but we don’t have enough to be able to pay off the student loans AND still have a decent sized emergency cash reserve. We’ve learned how important having an emergency fund is after Tori’s two foot surgeries and how her not working affects our finances.
If we did get rid of the loans, then we wouldn’t have that cash buffer. The payments on her loans are only about $200 a month now so losing a decent sized emergency fund to free up a cash flow of only $200 in an emergency doesn’t really seem like a prudent move.
Private Student Loan 1 – 8.0% Variable DESTROYED!
This loan was originally over $20,000 but was destroyed in the August 2013 update.
Federal Student Loan 3 – 6.8% Fixed ANNIHILATED!
This was a smaller loan at a little more than $4,000 but it too was destroyed in the August 2013 update.
Private Student Loan 2 – 5.75% Variable VANQUISHED!
This loan, originally over $23,000, was vanquished in the December 2013 update.
Private Student Loan 3 – 4.75% Variable FRESHLY SLAUGHTERED!
We just paid off this student loan a couple days ago. It took $7,943 to pay this loan off, but we knocked it all out since the last update!
Federal Student Loan 1 – 6.55% Fixed
The current balance on this student loan is $7,210.78. This is a decrease of $51.73 since the last debt update. This student loan will be the last one we vanquish in our journey to total student loan debt annihilation.
Federal Student Loan 2 – 6.55% Fixed
The current balance on this student loan is $6,508.70. This is a decrease of $313.71 since the last debt update. This is the loan we’re currently trying to destroy. Hopefully it will be gone before the next update, but that is a pretty aggressive payoff schedule and I don’t know if we’ll be able to pull it off or not.
Total Balance – $13,719.48 (-$8,308.16)
As you can see, we’ve made a ton of progress since last month! We’re more excited than ever as we can finally see the light at the end of the tunnel. We hope to be able to knock out this debt in the next few months but we can’t predict the future and what it holds for us.
I hope our story has inspired you that you too can pay off large amounts of debt. All it takes is determination and a ton of hard work. It can be done!
Are you trying to pay off any sort of debt? How is it going? I’d love to hear your story in the comments!
Lance Cothern, CPA holds a CPA license in Indiana. He’s a personal finance, debt and credit expert that writes professionally for top-tier publications including U.S. News & World Report, Forbes, Investopedia, Credit Karma, Business Insider and more.
Additionally, his expertise has been featured on Yahoo, MSN, USA Today, Reader’s Digest, The Huffington Post, Fast Company, Kiplinger, Reuters, CNBC and more.
Lance is the founder of Money Manifesto. He started writing about money and helping people solve their financial problems in 2012. You can read more about him and find links to his other work and media mentions here.