Two days ago I cashed out a GIC (before maturity, I don’t want to talk about it) and transferred at terrifying $1,200 out of my Emergency Fund (now below $1,000, don’t want to talk about that either) and wiped out the remainder of my student debt. As you might know, I’m partial to cashing out investments to make ridiculously large debt payments when I’m feeling blue.
Ok, not totally, there’s actually still $88 owing, but I have a monthly automatic payment of $97.29 that will wipe that out on the 31st of this month so I just wrapped it in to the final total ok? I guess I could have just pulled another $100 out of my EF but I was feeling pretty poor as is so I just decided I can wait until payday and let the regular payment wipe out the remainder of my debt at the end of the month.
I paid off a total of $21,628.12
which was $20,580 principle and $1,048.12 interest
over 22 months
And the reason I did it was because I was sick of being in debt, there was no reason to be in debt anymore, and I just wanted to move on.
Just less than 2 years is not a long time to carry a student debt load that purchased an entire undergraduate degree, but before I tackled my $21,000 student loan debt, I had paid off nearly $10,000 of consumer debt in undergrad. Yep, you read that right: my early-twenties cost me over $30,000. Granted, a Bachelors degree ($21,000) and braces ($6,000) were worthy purchases, but the rest was a lot of junk. I’m just glad I always held a part-time job or two or it would have all been much, much worse.
I had debt fatigue to the max, and my bandaid of choice was lifestyle inflation. I realize I’m one of the lucky ones: I found a good job after school. My starting salary at my job was over $50,000 and came with full benefits. In addition to this, MoneyAfterGraduation.com grew and expanded to the point that I was able to generate a small income from the website but also market myself as a freelance writer. Halfway through 2013, I’ve already grossed $40,000. I don’t say this to brag, I say it to point out what a joke it was that I had debt at all, and how sometimes that made me feel a little bit like a fraud. Now, people knew this and I received the occasional criticism for my traveling with debt, shopping with debt, etc. but probably not nearly as much as I deserved. I will always err on the side of 90% responsible with money, 10% spend-like-you’ll-die-tomorrow.
I stayed in debt from a number of (stupid) reasons:
- I wanted to stay relevant as a personal finance blogger for students & new graduates
- I wanted to invest my money in the stock market
- I wanted to save more for retirement
- I wanted to go on more vacations
- I wanted to buy more things
I know better than anyone there was no reason for me to carry around $3,700 of student loan debt for nostalgia and to stay relevant as a personal finance writer (I realize how ridiculous this sounds but this honestly went through my mind every time I considered wiping out my debt! Would my readers still love me when I’m debt-free?). Obviously being debt free and having your finances in order is the ultimate goal of every personal finance blogger, but I feel a little guilty anyway, and I would even go so as far as to say I feel left out. The PF community is pretty rad, but I know better than to stay in debt for the sake of blogging ;)
So ends my out-of-undergrad-debt journey. Good news: there’s still a lot to say about money once you are debt-free. Furthermore, I still have two awesome writers, Gillian and Erin, that are thankfully still in debt and can keep the spirit of MAG alive. Is it weird that I just said “thankfully still in debt”? I say it with love.
I needed to get out of debt to start the next chapter of my 20-something life. Maybe this deserves a post of its own, but I DID find a new apartment that has nearly all the things I wanted (balcony! dishwasher!). It’s more expensive than my current one and will need to be furnished, which was also motivating me to shake my debt balance so I could start completely new…. of course wiping out my debt means I have to go without furniture until like, October =(
So I’m broke. But I am debt-free.