How I Paid Off My Student Loans in 17 Months
Tags: devpride, motivation, productivity, theycoded
Published: 2020-08-22 16:37:43

If you would have told me 5 years ago that I would be completely debt free and would be learning to code full-time *during a pandemic*, I would have thought you were nuts... especially about the pandemic part. 

I was always interested in budgeting but I was not consistent with it and most of the time was wondering where all of my paychecks were going. I had a car loan, student loans accruing for a degree that I never finished in a major that I ended up not wanting to pursue, an iPhone loan from AT&T, and a PC loan (because I just *had* to have that gaming computer)... 

"This is what everyone does." I would tell myself as I was making all of these monthly payments towards debt and interest, not realizing that **this** is where all of my paychecks were going. My total debt was 70% of my annual household income. I was not even able to have $1000 in savings at one time.

In October of 2018, my partner and I were newly dating and discussing finances. We were listing out all of my debts and trying to start a plan to get them paid off. I told her that I had about $5,000 left on car. 

"How much is the interest?" She asked.
"Uhh, 16.99% apr... I think that's what the paper said but I don't really understand what that means." I replied.
Her jaw dropped to the floor and she quickly grabbed her calculator and started the process of telling me just how little I was paying on principle every month. It was going to take *forever* to pay off the car at the rate I was paying it off. 

That was the moment where I  decided, no more. 

We kicked it into high gear.

I got my budget planned out using the EveryDollar App which I HIGHLY recommend! 

Then I started to follow Dave Ramsey's baby steps:

**Step 1. 
Save $1,000 and DO NOT TOUCH IT. Lock it away in a shadow box and only break the glass if you ABSOLUTELY have to.** 

This I worked a little extra that month and was squeezing every little bit I could out of my budget. I ate out less, and really made sure that what I was buying was necessary. It took a lot of self-discipline but I wanted to be debt free more than I wanted that game, or those tacos. I hit my $1000 emergency fund and put it away in a savings account used ONLY for the emergency fund. 

**Step 2. 
List out all of your debts smallest to largest and start throwing every spare dollar at the smallest one.**

This is the point in time where you get hyper focused. Pick up extra hours, sell stuff, get a part time job selling pizza's. Make this step take as little time as you can. It will be uncomfortable, but it is worth pushing hard to get out of debt and free yourself. I paid off my car within 3-4 months of finding out about the apr and refinancing. My entire tax return and everything I had was going to my car. After the car was paid off, I started tackling my student loans, smallest to largest. 

This year I finally did it and it was the most liberating feeling ever! 
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**Step 3. 
Boost that $1000 emergency fund up to 3-6 months worth of expenses**

Continue the momentum and instead of throwing the extra money at your debt, throw it in your savings and build it up to 3-6 months worth of expenses. This one is more fun because you actually get to keep the money you are working hard for. But... DO NOT SPEND IT! 

I will quickly list the last steps: 

(Note: 4, 5, and 6 are done consecutively)

**Step 4.
Invest 15% of your household income in retirement.**

**Step 5.
Save for your kid’s college fund.**

**Step 6.
Pay off your home within 7 years if possible.**

And the final, most fun step:
**Step 7.
Build wealth and give generously.**

Anyone can do this! You just have to shift your perspective and believe you can. 

Know your "why?" and do it. 

Stay focused and you can become debt free and follow your dreams!

Thanks for reading!!