We paid off our school loans in three months! And you can too!
Well you might not be able to pay them off in exactly three months, but you CAN pay them off quickly.
It surprises me how many people think that they will be paying their school loans (or any other debt) for years. They just don’t realize that it can be done faster.
Why limit yourself to the timeline your loan service gives you?
I want to challenge you to think outside the box and develop a plan to see how quickly you can pay off your loans.
Once you have a plan supported by realistic figures, all you have to do is HUSTLE.
We had to get really creative to pay off $15,000 in three months! We didn’t have much extra to spare. But we did it, and I KNOW that you can too.
When we first decided that we wanted to be debt free (besides our mortgage) we set a totally crazy goal to pay our loans off in 6 months. We set a date for December 15th in hopes that they’d be paid off by Christmas.
Well, once we got some momentum, we cut that goal in half and paid them off in three months! Woohoo!
This is how we did it…
I hope that these ideas will help and inspire you to come up with your own plan for paying off debt.
1. Empty your savings besides $1000
We had $2,600 in savings. So step one was to keep $1,000 for emergency expenses and dump the rest on debt.
If you have no savings at all. Your first step should be to save $1,000. This savings is for emergency expenses that can’t be taken care of within your regular budget. It will prevent you from having to borrow money and go further into debt if something happens.
Total paid toward debt: $1,600
2. Cash in your Savings bonds
We had $1,300 worth of savings bonds sitting in our safe. Don’t get any ideas…we don’t usually keep that much money around haha.
We decided that by the time the savings bonds accrued enough interest to reach their full value our debt would be long gone. With no debt payments we could easily replace the money.
Total paid toward debt: $2,900
3. Tax Return
We’ve always used our tax return to buy something fun or tackle a home renovation project, but this year we realized the way to go was to put it toward debt. With our loans paid off, we could replace our refund in just a few months.
Total paid toward debt: $5,300
4. Sell your toys
The truth is, it’s just a toy. You’re not entitled to own it. You may work hard and think you deserve something fun. You should have fun, but I think you deserve the freedom of having no debt more.
Our fun toy was my husband’s motorcycle. We are starting a family and had no time to enjoy it anyway.
On a side note: I would keep anything sentimental like an inheritance or gift.
Total put toward debt: $6,500
5. Sell extra furniture and belongings
We went through our house and decided what furniture we absolutely needed and sold everything else. We downsized a LOT!
I’m not telling you to eat or sit on the floor, just be realistic about what you truly need.
The furniture we sold included: extra stove, woodstove, couch, dining room set, cabinets, tables, dressers, and other small miscellaneous items.
Total put toward debt: $8,700
6. Find extra income
Be open and observant of other income producing opportunities.
My husband had the opportunity to clean up a local farm and sell the scrap metal. He spent one Saturday gathering scrap metal and sold it for around $1,000. Not bad, right?
Maybe your extra income could come from one of these ideas:
- Mowing lawns
- Pet care
- Evening childcare
- Vehicle detailing
Total put toward debt: $9,700
7. Downsize in vehicle
We had three vehicles and two drivers. That didn’t quite make sense, so we sold Betty. Yes, we name all of our vehicles haha!
Betty was very sentimental to us. Betty took us on our first date. We were sitting in Betty when we had our first kiss (Eww!). We drove her during our early years of marriage. She took us to the closing on our first house. And mostly importantly, Betty brought home our first baby from the hospital.
So how did we get rid of something so sentimental you ask? We took a picture because it will last longer. Thank you third grade for that wisdom 😘
Total put toward debt: $10,700
8. Cut expenses to the bare minimum
I think our families thought we were nuts, but we cut wayyyy back.
Total put toward debt: $13,400
9. Use your third paycheck
Two months out of every year my husband brings home a third paycheck. Luckily, one of those months came just in time. We finished off our crazy journey by putting my husband’s third paycheck completely towards the debt to pay it off.
Total put toward debt: $15,000
Our next goal is to put $10,000 in a savings account for emergencies.
Share some of your crazy debt reduction ideas in the comments below!