42K x 30 – Month 3 Update

It’s the end of the month, and that means it’s time to recap my plan to pay off my student loans by my 30th birthday (33 months to go)!  Here’s the numbers from Month 3…

Student Loan Debt Chart - Jan 13

  • Starting Balance: $40,948.55 (Jan 1 ,2013)
  • End Balance: $40,112.82  (Jan 31,2013)
  • Paid Towards Loans: $1,031.01
  • Interest Paid$186.69
  • Principle Paid$844.32 (increased from past months!)
    • Dec ’12: $242.46
    • Nov ’12:  $640.63

Short Term Goals  Pay off this loans in this order (deadline)

  • 1-08 @ 6.55% (January February ’13): $748.21
  • 1-07 @ 6.55% (April ’13): $2,453.16
  • 1-05 @ 6.55% (Sept ’13): $5,224.54

I had big aspirations to pay off loan 1-08 this month, but fell very short (insert pouty face).  I  over anticipated my holiday bonus last month, forgetting that taxes take 25% of it (thanks, uncle sam).  So we’ll have to push that one off for next month.  This shouldn’t affect paying off the next loan in April because that all depends on the big tax return.  Last year we had enough from our tax return to pay off lots of debt, put into Avery’s college savings, AND build a deck.  So I’ll keep my hopes up on that working out.

Here’s a glimpse into what my massive spreadsheet looks like:

Spreadsheet pay off student loans january 2013

Maybe it’s a bit anal, but part of keeping on track with paying off loans is putting it all in writing. (OK, maybe I am anal cuz I just realized I never changed the title from Dec to Jan… oops!… to prove I’m not anal, I won’t correct it!…at least not on the image… totally fixed it in the spreadsheet!)  This helps me keep track of the numbers while motivating myself as I see the numbers go down every month.

What I Learned I’ve been looking into Dave Ramsey’s stuff… and thinking about reworking my goals to do the smallest loans first, no matter their interest.  I ordered his book ‘More Than Enough’ and we’ll see if I gel with his ideas.

Rewarding Myself I’ve been playing on www.Saveup.com and last month I won a $10 off coupon to Shoebuy.com…which went to a pair of (much needed) new running shoes.  Woot Woot!  I got another $10 off this month and I’m hoping to get another one so I can get another pair of shoes specifically for Zumba & Kickboxing class… more of a dance shoe.

February Plan

  • Pay off Loan 1-08 ($748.21) + min to other Sallie Mae loans
  • $40/wk. to VSAC Loans
  • Read Ramsey’s book
  • Have our taxes done – & see what our return will be!

Reflections I’m bummed I didn’t meet this month’s short term goal… but I am sooo excited to see my loan debt drop under 40K!  2-1/2 years of paying off student loans seems like it’ll be exhausting  but it’s kind of fun.  I looked at my minimum payments for all my loans and if I only pay the minimum (a big no-no) then my last loans would be paid off in 2022.  That’s 9 years from now!!!!  If we are thinking about financially being ready for baby #2, and don’t want them 10 years apart, that right there is motivation!  2 1/2 years vs. 9 …. big difference!  And can you imagine the $$$ saved by not paying all that interest for those years!

Do you have any tips and tricks to share on how you are/did pay off your student loans or debt faster?  One helpful tips I’ve received as of late is to pay bi-monthly or bi-weekly, as it cuts down on the interest.  I do this with my VSAC Loans, and I’d do it with Sallie Mae too if that was an option – they’re so limiting with how to make payments.  Anyone else have that issue?

Did you miss the previous posts on this financial challenge?  Play catch up here:

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8 thoughts on “42K x 30 – Month 3 Update

  1. I am so happy to see that your momentum is going. I know I have mentioned it on my blog but we like many of the theories behind Ramsey’s books and have applied them to our lives. I am excited to say that next month we will pay of student loan number 2! 2 loans in 2 months makes this momma happy. It is all about tightening the budget all around but is so worth it!

  2. I am also working on paying off some debt, and find your updates inspirational. Congrats on taking charge!
    A few thoughts on Dave Ramsey (I have his Total Money Makeover sitting on my coffee table at home as I type): I also love his snowball idea. It’s so easy, once you’ve paid off one debt, to take the money you were applying to that debt and keep applying it toward the next one. You don’t have to change your budget but your debts get paid off faster! BUT I think he gets a little nuts at times and underestimates the “human” elements that sometimes need to go into purchases. Anyway, the point is, great post! I love your monthly updates. They keep me motivated.

  3. Snowball, Avalanche, however you slice the pie it’s still a cake ;).

    I agree with keeping the money allocated towards the debt, I just disagree with paying smallest loan first, disregarding interest for the illusion of “reward.” You end up paying more in the long run, for the instant gratification of paying off the smaller loan.

    Alas, to each his own!

    • I’m gonna do a combo of smallest loan/biggest interest paid first. Who knows if it’s the ‘right’ way to do it, but these loans will get paid off much faster and thusly i’ll be paying MUCH less in interest. Intead of 9k in interest, it’ll be more like 2.5k. Woot Woot!

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