How I Paid Off $100,000 of Student Loan Debt
On June 15, 2022 I took a deep breath and pressed "submit" on my last student loan payment officially saying goodbye to $100,000 of debt that I'd carried my whole adult life. In that moment, I felt a mixture of relief and grief. This big audacious goal that I'd had took me about a decade to fully accomplish.
Here's how I did it, what I learned, and how you can pay your student loans off even faster than I did.
Listen to my full student loan debt story on my podcast Balanced Black Girl:
My Student Loan Debt Payoff Strategy
I loosely followed the debt snowball method to pay off my student loans. I graduated in 2011 with a mixture of federal and private loans, and while I aspired to pay them off, it took me a few years to truly get serious about tackling my debt. For the first few years after graduation, I setup minimum payments for my loans on autopay, and didn't pay much attention to them from there.
In 2015, I realized having so much debt was preventing me from reaching other goals like aspiring towards entrepreneurship, because I didn't have the flexibility to take financial risks. I then decided to take a look at where my loans stood, and starting putting extra money towards the loan with the smallest balance.
By the spring of 2016, that student loan was paid off, and I set my sights on the next batch of loans -- my federal student loans. While I had a few months of dedicated payoff towards this debt, later that year I experienced some career changes that caused a significant decrease in income for about three years. Since my income was a fraction of what it was before, I went back to paying regular payments and focused on ways to increase my earnings.
Increasing My Earnings to Pay Off Student Loan Debt
During those years I took up several side hustles including working in retail, personal training, and creating and monetizing content. By 2019, I was back to earning a more comfortable wage and resumed my debt payoff goals. In February 2020, I pressed "submit" on my last federal student loan payment. Little did I know, a few weeks later the COVID pandemic would start and these loans would have been put on pause for a few years. While the timing of that payoff wasn't ideal, ultimately I would have wanted the debt gone and am glad I went ahead and paid them off.
This period was also significant for me because I had recently relocated from Seattle to Southern California, and experienced a pretty steep increase in my cost of living. I set my sights on increasing my income yet again, and spent most of 2020 reading personal finance books, leveling up my skills at work to prepare for a promotion, and strategizing ways I could earn more from my content.
Watch my full student loan debt payoff story on YouTube:
That hard work paid off, and by spring of 2021 I was earning significantly more than I was just two years prior. With a greater financial cushion, I set my sights on my last and final student loan. I diligently tracked my finances during this time, and anytime I had any extra money left over in my budget it would immediately go towards debt. Any extra money that came in whether it was from refunds, my side hustle, or anything else would go straight towards debt.
The last push towards paying off my final student loan came from the money I earned selling an exercise bike I no longer used, and my decade-long journey with student loan debt came to an end.
Tips for Paying Off Student Loan Debt
While I'm relieved to have paid off my student loans, I now know there were ways I could have paid them off faster, accumulating less interest which would have cost me less money in the long run. Here are my tips for paying off student loan debt:
1. Pay High-Interest Debt Off First
As mentioned above, I used the snowball method to pay off my student loans. If I could do things differently, I would use the avalanche method instead. Essentially instead of paying off the debt with the lowest balance, you pay off the debt with the higher interest rate first so you accumulate less interest over time. The last loan I paid off actually had the highest interest, costing me thousands of dollars over the course of a decade. I would have been better off paying this loan off first, and saving my federal loans for later because I could have had a few interest-free years to do so during the pandemic.
2. Pay As Often As You Can
I truly started seeing movement with my student loan payoff when I made more than one payment per month. Essentially, interest on your loans compounds daily. The more days between each payment, the more interest accrues and the more you have to pay. When I began breaking up my payments and putting money towards the loans more often, more of my payments finally went to principal instead of interest, and I was able to truly start paying the debt down.
3. Believe You Can
I'm not the most financially-savvy person in the world, and I didn't have an elaborate debt repayment plan. I don't come from wealth, and have been financially responsible for myself since I was a teenager. I believe the main reason why I was able to pay off my student loan debt was because I believed I could. Once I decided paying off the loans was going to happen, I gained so much momentum towards the goal. While it certainly wasn't easy, and I spent many years living frugally, the belief that I could do it helped me see opportunities to earn more which was ultimately enabled me to pay off the debt.
Listen to related episodes of Balanced Black Girl:
- How to Get Your Money Together in Your 20s and 30s
- Having A Healthy Mindset and Becoming Recession-Proof
- How to Create and Stick to A Budget, Pay Off Debt, and Reach Your Financial Goals
Need help paying off your student loans or other debt? Download the debt repayment tracker Notion template that I used.