[-$107,000] The First Payment

matches- the first payment w

Kill it with fire!

My student loan refinance has gone through and the balance on my previous student loan servicer’s account is now $0.00!  I’ve logged in at least 4 times since that wonderful event, just to look at the zeros. Somehow I bet that it is normal to do that. 🙂

I was worried that I would end up with my own crazy-making servicer payoff story when trying to get them out of my life forever. Unsurprisingly, they were super slow in processing the payoff check, probably to rack up the last bit of interest, but they didn’t try any other tricks. Goodbye old servicer!  *Waves goodbye*

Now that my student loan debt is situated in its new (servicer) abode, it’s time to burn said abode to the ground!

To adapt the Read More

My ‘Working Again’ Debt Payoff Budget September 2013


Photo credit: LabMinions.com

Now that I am working again and no longer unemployed, I’m revisiting my old unemployment budget and making updates.

NET Income Per Month (after taxes & required deductions)

Job #1:  $4,935    Omg, taxes are a BEAST!  Grrr.

Job #2:  $540

I am not pursuing any additional side hustles at this time. Between these two jobs, I’m maxed out on hours and stress (60-75 hours per week). Any more than that and my health suffers noticeably.

Total Income:  $5, 475


The Outgo per month

Rent+Utilities:  $1465   (Unfortunately, I’m back in an expensive apartment, this time WITH a roommate.  How this happened.)

Phone:  $70    (Yes, I still have my iPhone. Sigh.)

Student Loan 1: $40    (This one is not bundled with my others, so I pay on it every month.)

Food: $500    (Yes, this is too high. I am not cooking and still eating out a lot.)

Public Transportation: $200  (Yikes! Public transit is waaay more expensive here than I thought it would be. )

Health Insurance: $100  (Yikes again! This is the cheapest High Deductible plan offered.)

Credit Card Debt:  $2,000  (Ouch!  Did I mention how much I HATE debt!? The credit card debt will die first.)

Student Loan 2: $850    (These payments begin next month. This is interest only. Aggghhh! This should be retirement money!)

Gym Membership: $65

Netflix: $15

Fun/Misc/Clothing: $100

Emergency Savings: $70

Outgo Total:  $5,475


What Does This Mean?


This will roughly be my budget for the next year. I will not be having fun. This assumes that all goes well with my new job and that I don’t get fired again. This assumes that I don’t have any major health problems. Items in red are targets for cutting. This apartment complex makes it virtually impossible to get out of your lease, so I may be stuck here for a while, but I will consider my options. As soon as I am able to look for cheaper housing I will do so. That will save me hundreds of dollars each month that I can put towards retirement and emergency savings.

What Does This Really Mean?

“Debtor’s prison is real, and opportunity cost is a bitch.” (DDSW)

Locked Up USA: Student Loan Edition

Every once in a while when I have a spare hour among my three jobs, I like to stream an episode of Locked Up Abroad.  (Record scratch sound here.) Yes, Locked Up Abroad.

locked up header

I started watching the show when I was still in my pricey apartment. Initially, I thought I was drawn to Locked Up because of my interest in seeing representations of exotic locales and the basic drama of the program. But as time went on, and I began to make plans to move and downsize, I realized that I was drawn to deeper aspects of the storyline.

Those of us making sacrifices to get out of deep debt often see ourselves in a metaphorical debtor’s prison. For many of us, while watching Locked Up Abroad, we  can see the parallels  in our own financial lives.

lua worried woman

In Locked Up Abroad, a relatively good person gets into a tough financial situation. Sometimes this financial need is real, but most times it is perceived. Next comes the inevitable bad and life altering decision. For some of us, this may have been the need of a college education, and the bad decision to attend an expensive university with big student loans.

We enjoy the fruits of our clever moves for a little while. The expensive college environment, an off-campus apartment, the smell of ivy and textbook glue. We allow ourselves the luxury of dreaming of a future life that will be better than what we came from. With the right effort, we expect to experience upward mobility. We dream.

lua - having fun

But we can’t stay in dreamland forever. After a while, it becomes apparent that it will be time to pay the piper soon. We get a wake up call when we see the loan debt we have accrued so far. We start getting cold feet. ‘Can I go through with this? Maybe I should stop now. But I can’t stop now. If I stop now, I’ll have nothing to show for all that I’ve done so far. I have people back at home counting on me to finish this.’  Next, ominous looking student loan notices start showing up at the door. We are becoming fearful for our future. But we buy into the sunk cost fallacy and decide to continue with everything despite the deep risk we now realize that we are taking. Reality is sinking in.

lua -woman with smugglers

We have now graduated and are likely underemployed. We are barely paying our bills, just squeaking by. Perhaps we realize that with all the debt we have, we’ll never have enough cashflow to buy a house, or start a family, or take a vacation that we see everyone else enjoying.  Meanwhile, either our loans are due after the six month grace period, are coming off of forbearance, or we simply have an unexpected financial expense. At this point, we have crossed the event horizon. We have passed the point of no return.

LUA - squeaking by

Around now, we experience a reckoning. Our bad decisions have caught up with us. We’re caught and exposed. There is no place to run. There is no place to hide.  We feel embarrassed. We have to pay. We hit rock bottom. That’s when we begin to do  hard time in debtor’s prison.  On the show, it is the prison segments that really strike a chord with me. Now, living in my small 10 ft. by 10 ft. old rented room with three pieces of salvaged furniture, I sit and think about all the decisions that I could have made differently to avoid my current situation. With roommates, I have little space and little privacy. This is not the life I envisioned having at 38 years old.

lua - cell

The show  helps me to see how they coped and survived their imprisonment; not knowing when or if their ordeal would ever end.  I can relate in some small way. I would never try to compare my situation to theirs, but watching the show helps me to cope when I need it; if only to keep in mind that many others are facing much harsher consequences for their poor decisions than I am.

LUA - hope

Even in the face of uncertainty, those of us in deep debt must stay hopeful. We must stay focused and disciplined when it comes to what we do with our money. We must protect it. The longer we stay on good behavior, the more of our debtor’s prison sentence will be reduced.

Remember that the prisoners on the show eventually regain their freedom, as will we.


“Debtor’s prison is real, and opportunity cost is a bitch.” (DDSW)