Hello Everyone - I love frequenting the budget board for my budget ideas especially since I'm a student living on a very small budget. When I graduate from school next May, I will have a VERY LARGE amount of student loan debt (think $100k+). I don't own a home or a car so my debt is entirely due to my education.
So I'm wondering for all you folks who have some kind of debt, what kind of debt do you have?
Anyone with student loan debt have any ideas about paying it off? (aside from getting a nice paying job, of course
)
Live cheap! Learn the difference between a want and a need.
When I graduated college due to a combination of academic and athletic scholarships I had no college debt. However I was also used to having a good amount of free money every year, over and above my expenses--my scholarships added up to about 115% of college costs. So I had some pretty extravagant taste--especially for a young kid.
My husband however was the exact opposite. He had approximately $150,000 in student loans, plus an additional $15,000 in consumer debt. He made more money than me--we met a few years after college, he spent more money than me, but had nothing to show for his money. He was more of a dinner out every night--I was more PB&J everyday for lunch carried in my $250 purse. Obviously, neither was a real smart money plan. Oh, and it mortified him that I went to the grocery store with coupons.
While still dating I purchased a modest condo--future husband was basically not credit worthy due to large amount of student loan debt (even with his larger income, he could not get the mortgage). He moved into my condo, and essentially paid half the mortgage (which was less than his previous rent).
We cut costs to the extreme--these were the high living pre-dot-com bust mid-90's--all our friends took lavish vacations, and we got part time jobs. I kid you not we used to have $10 date nights (2 tickets to second run theater, popcorn, 2 wendy's sandwiches for 99 cents--we brought our own soda). Husband learned to love coupons.
We paid off all of his consumer debt, while making these enormous student loan payments--making him more credit worthy. Since the housing market was going crazy at this time--we sold the condo after 2 years for a good profit (1/2 went directly to his loans, 1/2 toward the principle of the next townhouse) and got a crazy low 4% new mortgage rate. Any extra money we had went to the student loans--seriously if his Grandmother sent him $5 for his birthday, I would send it to the loan people.
We got a good price on the townhouse (due to the crazy decorating styles of the previous owner) and lived there for 2 years. During those two years we stripped wallpaper from every room floor to ceiling (including the basement) and painted everything off-white. Keep in mind, we both had full time jobs & part-time jobs--all extra money went to the student loans. I could teach classes on wall paper removal. No cell phones, cable, driving crappy cars, etc. Since the housing market was still good--we sold the townhouse for nearly a $50,000 profit and paid off most of what was owed on his loans. That year we took our first "real" vacation.
When we purchased our home, for a thousand dollars more than we sold our townhouse--once again a decorating special--we had less than $12,000 left on the student loans. We kept up our frugal lifestyle all the while husband's income has tripled. In the same way we paid off the student loans, we paid off the house, and no longer have any debt--except monthly credit card charges. We still live cheap, and are essentially money stress free. Like everyone else we have had some set backs, and seriously unexpected expenses, but we keep plugging along. We now have two decent cars, not new or luxury; but it would shock me if the car did not start. Our homeowners insurance agent laughs that we will be the last people in America to get a flat-screen TV, we pretty much do not buy new unless there is a need.
We are not deprived, but still live on a budget. At the same time if my husband came home and said he wanted a $3,000 TV, I would ask him a few questions and transfer the money to cover the costs. We can afford to buy most things, but the funny thing about having the money in the bank--is that we find we want less.
So that is pretty much our story--our friends are all in debt, and live a "big" life compared to us, we certainly don't have all the "stuff" they do and at the same time we don't have the stress.
Good luck paying off the loans--they suck.
Definitely make your payments on time, the federal loans will decrease the interest after 4 years of paying on time. We also threw any extra money at the loans. My husband used to get quarterly bonuses and we would also put the tax refund towards it. That was before children. Now they suck up any extra money... 
So if you don't have kids yet, I would recommended paying off as much as you can now! But I still put a little extra towards the student loans, maybe $50-100/month. Looking forward to one year from now when the student debt is finally paid off, along with one car paid off. Good luck!
