But those student loans. They are like a rock around our necks. I am not going to debate, here, the many, many problems with student loans and education financing in this country and blah blah blah. It's a problem, the end. I'm dealing with the reality of paying back the loans, which for the foreseeable future is a necessity for many, many people.
We are lucky. Very lucky. My parents, with a bit of help from me, paid for my schooling. I, mostly unknowingly, did things fairly cheaply (community college first, then moving on to a school where I got in-state tuition) so while I didn't emerge from school rich or with a lucrative career path ahead of me, I did end debt-free.
HusbandX, on the other hand, did not have that. What he does have, instead, are investments from his parents. Alaskans get a lovely little thing called the Permanent Fund Dividend, which HusbandX's parents wisely invested for him. So he finished school with debt, but also with money as a backup to pay it off should he run into tough times. Since I worked for the University for many years, we also got spousal benefits in the form of a tuition waiver, some for his first degree and his entire second degree, minus all fees/books, was paid for that way.
Still, he took his time with his first degree and with some deferment due to a period of unemployment and a few other factors, they became what I consider sizable, although according to the numbers it was about average.
And we are going to pay them off far sooner than average too. Despite unemployment, despite the fact that for most of the time we've been paying them these loans have cost us a minimum of 1/4 - 1/3 of our total income, we're paying them off as quickly as we can. And we haven't even dipped into the investment money yet.
|Our cat is shocked by how quickly the loans are being paid off.|
It hasn't been easy, I admit. In Fairbanks there were plenty of times when, after rent and student loans, we'd only have about $300-400 leftover for utilities and food. There were even times when that amount would have seemed generous compared to what we actually had leftover after rent and debt repayment. I would say that I budgeted carefully, but I've never been a budgeter. (Instead I'm lead by the simple goal of "spend as little as necessary", and it has served me well.) We didn't always come in under our "leftover" amount , but we had our other secret weapon.
In the high times, such as when HusbandX had steady employment, we saved as much as we could. Having tasted unemployment several times, neither of us wanted to be left in a situation where we didn't have a cushion to fall back upon in the inevitable hard times. Having money set aside also gave us the freedom to determine how much money we were comfortable putting toward the student loans every month, factoring in potential future periods of unemployment (and I'm still thanking our prudence there!), rather than scraping together the minimum payment as an afterthought each month.
Now that we've been double unemployed for seven months, we're still easily able to pay more than the minimum payment, no deferral necessary. For the most part, we let it auto-pay from our account and leave it alone, although about once a year I have HusbandX check it so that we can high-five each other about how much has been paid off so far.
Technically, we have enough saved now that we could pay off all of the loans and be done with them. However, that would leave us without any financial cushion, and since we still don't know when employment will happen (please, please let it be soon!) we want that money to help cover our living expenses for the moment. When HusbandX does find employment, we still won't pay them all off immediately. Our first priority will be housing of our own, and only then will our main priority will be paying off those loans once and for all. Forget paying a couple hundred bucks extra each month, we're going to throw all of the money we can at this loan (which is all of the money left after retirement, taxes, and the most basic of living expenses are taken out) to get it over and done with. We want this lodestone gone.
I'm saying this because I hear so many people talk about how they'll "never" get rid of their student loans, and there are pretty much daily "news" stories about the same attitude. What I really want to say to those people is: make it a priority. Pay it off not with the minimum, but with the maximum that you can afford. Pay it off as quickly as you can so that it's not hanging over you, and so that you pay less in interest overall. Just pay it off so that you don't have to budget for it or think about it anymore. It's not insurmountable. If you've got student loans it's because you're an educated person, so put those smarts to use and figure out what frills (and there are always frills, even in HusbandX's and my spending during unemployment) you can easily cut out and put that money toward your loans instead. Trust me, it will make your life better.