At long last, I have reached the 50’s! Can you believe I’ve been in the 60’s since July of last year!?!
It really doesn’t take long to notice how much reducing my monthly payments impacts my timeline.
Current stats on my student loan:
Original Balance: $112,258
Remaining Balance: $58,600
Monthly Payments: ~$1,720.00 (down from $2,720) 😦
Term Remaining on Debtor’s Prison Sentence: 3 years and 1 month 😦
Current (variable) Interest rate: 4.55% (up from original rate of 3.42%)
I made an extra $84.09 payment to bring my balance to an even $58,600. My monthly payments over the past several months have been not much more than the minimum, which is substantially lower than the $2,720 payments that I was making for most of last year. My monthly payments are down currently for three reasons:
One. I have an international trip coming up relatively soon and I need to have cash on hand for that period of time.
Two. My credit card debt. When I get back, any remaining cash will immediately be put toward my credit card balance until that is paid off. After that, I can get back on track increasing payments to my student loan.
Three. This year I will be making payments towards maxing out my Roth IRA. This will also cut into the money I’ve been throwing at my loan.
I knew I’d have to cool it with my extra high payments eventually as I couldn’t restrict my spending enough to support it. Now, it’s looking like I will be in debt another 3 years, according to the chart. But I’m not too worried yet. My size of my payments will increase in the second half of the year, so this should go down to about 2.5 years I guesstimate. One month at a time…
Shake Your Moneymaker!
Yeah, you know what time it is. Time to mosey down to Motown. This song is my anthem right now and was also one of Motown’s first hits. Shake it, but don’t break it!
Barrett Strong – Money (That’s What I Want) 
Barrett didn’t know this, but that song was written for me.
Zach @ Four Pillar Freedom has been motivating me, through his posts, to give my net worth more attention and to remember why it’s important to work on increasing it (and investments) now rather than later. If you have an interest in financial independence and enjoy data visualization like I do, check out his blog. At 24 years old himself, Zach’s posts tend to aim towards Millennial readers, however, good personal finance principles work for all and provide value regardless of age.
- The Math Behind Saving Your First $100k
- Money, Money, Money: Visualizing the Net Worth of Rockstar Finance Blogs
BigLaw Investor @ The BigLaw Investor is, surprise!, a law school survivor and ‘Big Law’ lawyer who writes about personal finances and paths to financial independence. His posts are primarily aimed at law school graduates (not me) with big law salaries (definitely not me), but are still helpful for the rest of us with big debts, or those looking to make big changes to their finances. Check out his blog.
I’m going to look into refinancing into something fixed before interest rates possibly shoot up another 1% this year. I’m a little anxious about possibly switching over to a new servicer, but if it can save $$, I’ll be willing to try it. I can always switch back if I want to.
“Debtor’s prison is real, and opportunity cost is a bitch.” (DDSW Archives)