I Repaid $40K in Student Debt in Less than 5 Years By Following These 3 Rules

I repaid $40,000 in student debt in under five years, and now I want to help others do the same.

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Kaitlyn Duling63
April 22, 2024 at 4:8AM UTC

The day I received my first student loan payment, I cried on the couch next to my dad. It was just a few months after I’d graduated from my (wonderful) private liberal arts college. It was, in fact, a school that had billed itself as one of the top in the region when it came to financial aid. When I was an 18-year-old high school senior, I chose the school in part because it was the most affordable option out of the six to which I had applied. After crunching the numbers and presenting a spreadsheet to my parents, it seemed like the wisest decision. Maybe it was. But Dad’s face was stony and a little sad as he watched me clutch the damning letter in my hands. I had left my idyllic college experience with a writing degree, a caffeine addiction, a handful of expensive used textbooks and $40,000 in student debt.

Let’s get the known facts out of the way: most students leave college with debt, and that debt can be financially, as well as emotionally, crushing. Some will carry loads far less than mine, but too many will be burdened with undergraduate debt climbing towards (or even above) $100,000. I was lucky enough to pay for school using a mishmash of merit scholarships, need-based grants, and loans. When I realized that a good portion of the “financial aid” I had received from the college over the past four years had been, in part, in loans, and that I was to repay those loans on my own, I was terrified. I couldn’t stop shaking. I couldn’t job search without breaking into a sweat. The stakes had become very, very high, very quickly.

We can now fast-forward to another quick fact: I paid off my debt within four years of my 2013 college graduation. The moment I paid it off is one of my happiest memories, though it came without any fanfare. Just me sitting cross-legged on my futon, clicking a button and then shutting my laptop. Debt-free life, though, is an incredible feeling, and it is a privilege that allows me to feel more secure (financially and emotionally) every single day. Whether I’m quitting a job I can’t stand, applying for a credit card or thinking about purchasing a new-to-me car, I function with more confidence and ease. If I can pay off $40k over four years, I can do anything, right? And if I can do it, so can you.

You’ve probably read tons of articles about how to get rid of debt—I read them too. Now, when I’m talking to others about how to say “thank u, next” to the debt obligations in their lives, I start with these four surprising ways or "rules" for to look at their loans. They won’t be the answer for everybody, but parts of each perspective helped me to tackle my own debt with (relative) ease.

1. Go big or go small, but pay more than the minimum payment.

It might feel manageable to pay the minimum due on your loan each month, and that is one way to handle your debt. However, if you want to pay it off as quickly as possible, especially in five years or less, you’ll want to instead consider the maximum amount you can pay. Start with your salary, then subtract your rent, utilities, food, and transportation costs. If you’re being totally honest with yourself, you’ll want to leave a little bit for discretionary spending, too. But other than that, all of the leftover income can go towards your student loans. Yes, all of it! I saved a tiny amount during the years following graduation, but focused heavily on paying down my debt.
Paying down debt rather than saving isn’t the best advice for every individual, but I knew I would have time to prioritize saving later on. Each month, I took a big bite out of my total debt and my accumulated interest, working my way through it in large chunks. For me, this helped with the anxiety, sadness, and fear that can come along with realizing (for the first time, somehow) that I had tens of thousands of dollars to pay off on my own. I could see the numbers ticking downwards in a real and meaningful way, which just helped motivate me even more.
Another way to tackle your debt is to set a number—maybe it’s the minimum payment, plus $50 or $100. Pay that every month. But every week, sit down and take a look at what income you have left over after the expenses of the past seven days. Using mobile banking, move that money into a separate account. Then, at the end of the month, put all the money in that account towards your debt. This solution works well for people who balk at the idea of pushing large parts of their monthly income towards their loans. If you can review your income on a weekly, or even daily basis, it feels a little more manageable.
After a few months, you might start to see the ways in which your shrinking debt is directly connected to the choices you make on a day-to-day or week-to-week basis. Skip a few coffeeshop visits or take extra care with the grocery shopping that week? You’ll probably see the money in your “loan” bank account grow. This can also be an ideal solution for those who don’t like to tie themselves to a strict budget. It leaves room for choice and change, but still requires you to think about the debt—and how you can shrink it—regularly.

2. Remember the extras.

New graduates who are just dipping their toes into real-life money management often look forward to those little “extra” moments that seem to pop up from time to time: gifts of holiday money from parents, finding $20 on the street, working a gig for a friend and earning $50 for your efforts. These instances can be fun and take some of the pressure off…but they can also be a wonderful opportunity to pour some more cash into your loan repayment.
When I was paying off my loan, I often used small gifts from loved ones (and from the universe) to pay down my loan, even though people told me that it was like taking water out of the ocean—that the $20 bills wouldn’t even make a dent, so why not take myself out to dinner instead? Those people were wrong. When combined with my income from my first jobs, side hustles, and AmeriCorps education award, these little things made all the difference. They were also helpful psychologically. I loved watching the total number drop, and if I saved up enough $10 and $20 bills, could soon make it shrink by a whole $100! That is no small number, even when you have thousands of dollars in debt. Every little bit helps. It does.

3. Consider the trade-offs.

This may be the most annoying of all tips ever conceived, but I stand by it. In order to pay down my debt as quickly as possible, I had to make trade-offs. I shopped at budget grocery stores and bought things I didn’t love to eat just because they were cheap. I gave up Starbucks. I bought the cheapest gas for my car and shopped only at thrift shops. I even chose the city I would move to after graduation — Pittsburgh, PA — in part because the cost of living there is so incredibly low. With a tiny shared apartment and minimal rent to pay, I could save up to pay down my debt.
Now that I’m debt free? I’m living in the city of my dreams (Washington, DC), buying only the foods I love, and going about my days without the constant pressure of debt payments. It feels incredible to know that all of my money (okay, minus rent and bills) is mine, period. All it took was a few years of careful choices, aggressive loan repayment and the attitude that I could, (somehow, someway) erase that debt.

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