Student loans.
Not sure if you would react the same way, but when I hear someone say those words I tend to duck and run for cover.
Looking back to when I was a college student (walking to school uphill both ways in 3 feet of snow…yada yada) I didn’t feel as though I was TOTALLY irresponsible, but I did develop a “just add it to my tab” mentality when it came to my student loans. I just kept adding the debt to the final tally because it didn’t feel as though I would get out of debt…like, ever. And if I am being completely honest, my grasp on the reality of student loans was nonexistent. I thought that someone would either hand me a “get out of debt free” card or maybe, if I just didn’t think about my loans, they would go away.
How did this mentality prepare me for paying them back? Well…it didn’t. I had to completely change my way of thinking, and this where I am today: taking charge of my debt and paying back my student loans.
Here are a few things I am doing to tackle my student loan debt:
1. Understanding my student loans
I mean REALLY understanding them. Sure we make our monthly payments but do you understand how long it will take to pay your loans off? I started by creating a spreadsheet of my loans, which forced me to take a look at the reality of my debt and gave me a clear understanding for how long I would be paying them off for. I even downloaded an app called “Debt Free” that helps me keep track of my debt and shows me how much longer I have until I’m debt free. There are a bunch of these types of apps for both iPhone and Android. I know, right? Awesome.
2. Living like a college student
I am 5 years out of school but that doesn’t mean I can buy a house, purchase a new car, or take a fancy trip. I still live like a college student: renting an affordable apartment, using hand-me-down furniture, driving a used car, and taking bargain trips. Sure I still do some of my favorite things like go to concerts and sporting events but I may not do them as lavishly as I would like to. (Shout-out from the nose bleeds!)
3. Choosing to hang out with cheap friends
Simply put, hanging out with friends with a similar lifestyle and choosing to do things that don’t cost a lot of money helps me save. Note: I have a lot of friends that don’t have student loan debt and I have a lot of friends that can completely relate. (I love them equally – hi guys!) Almost every time I make a suggestion that is free or cheap – they are in. Most people like saving money!
4. Planning ahead
There is nothing worse than having to choose between a $400 student loan payment and a $400 car repair. Planning ahead for those expenses can help prevent the walk of shame over to your parents asking to borrow money or even worse – credit card debt. Each month I put aside money in an emergency savings account to help prepare for those situations. Even if it is a small amount, it will help if an emergency like that pops up.
5. Protecting my parents from my debt
Knowing what I know now, I can’t believe that my parents would even cosign a loan without having a life insurance policy out on me. I took a life insurance policy out on myself to protect my parents from my debt and have never felt such relief. I only kick myself for not doing it sooner. There is no sweeter night sleep knowing that if something happened to me, my legacy wouldn’t be the debt I left behind. If you can relate, the same path might be something to consider.
6. Celebrate the small wins
After all, every step is headed in the right direction, right? Every dollar is one dollar closer to being debt free which is the ultimate goal. Set a reachable goal for the year and then reward yourself when you hit that goal by going out for dinner with friends or allowing yourself to put a little extra away for a fun trip.
Written by Ann Lindquist
This blog post is from the Author's perspective and doesn't speak for brightpeak financial. Contact brightpeak if you want to know more about brightpeak products, and keep in mind that they are not available in all states and there are some limitations (some exclusions and restrictions may apply).
