Greetings my upwardly mobile friends, today I reached a big milestone in the war on student loan debt. As I’ve previously posted, I intend to pay off the six figure balance on my student loan debt in the next 24 months.
Once upon a time, the loan balance was above $150,000.00. Four and a half years after graduation, and the balance is now just under $93,000.00. The first milestone is that My loan balance is below six figures. It’s actually a triple milestone. It’s the first year I’m entering where the balance is less than my income from the prior year and it’s also less than half my 2017 income.
My 2017 end of year bonus was the perfect way to start the year strong with a big payment toward the student loan balance. While some people take on side hustles, I always work as hard as I can so that I get large bonuses from my employer. To reach my goal of paying these loans off in 24 months, i’ll need to frugal the hell out of my budget while experiencing life as a first year parent. I need to squeeze $40,500 from our income to throw at the student loans in the next 363 days.
Paying as much as I can as soon as I get money is a huge way to save overall. If I didn’t make this lump sum payment with my bonus, the interest that would have accumulated in January would have been around $415.67. By making the lump sum payment with my bonus, the interest that will actually accumulate is closer to $359.60. This payment means my future payments will pay more than $56 per month in principal debt and will save me $672.84 in interest in 2018. That savings is like receiving an extra thousand dollars pre-tax on my bonus.
One step closer to shedding the shackle of student loan debt. Will anyone else join me in freeing themselves from their wealth killing debt shackles?