42K x 30 – Month 5 Update

Student Loan Debt - Mar 13

Consider me and April Fool.  I am completely frustrated and disappointed   My dream of paying off my student loans by my 30th birthday are going up in smokes.  I was counting on a nice chunk from our tax returns this month to smash another loan that’s towering just over 2K right now.  As it turns out, we’re probably going to OWE money this year, instead of get a refund.  Seriously.  We’re still working out the kinks, but apparently we’re now making too much money and are bumped into the next tax bracket.  More Money, means paying a higher percentage of taxes. I guess working harder, getting promoted and rewarded for it will just result in paying the government more money.  Not fair.  The harder I work my A$$ off, the more money they take from me.  Makes perfect sense. Thank Uncle Sam.

OK, done ranting (for now).  Back to the numbers.  This month I didn’t get my extra payment into Sallie Mae before the end of the month, so although the numbers are weak this month, next month I’ll have over 1K towards the loans.

  • Starting Balance: $39,147.53 (Mar 1 ,2013)
  • End Balance: $38,812.46  (Mar 31,2013)
  • Paid Towards Loans: $512.73
  • Interest Paid$175.91
  • Principle Paid$336.82

Not a big change from last month, but less debt is progress.  I’m still bummed about not reaching my next goal.  At this rate, I won’t get the next loan paid off until end of summer.  Boo.  That pushes back all my short term goals…

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

  • 1-08 @ 6.55% (February ’13): $0
  • 1-07 @ 6.55% (April Jul ’13): $2393.63 <— NOT gonna happen!
  • 1-05 @ 6.55% (Dec ’13): $3176.80
  • 1-06 @ 6.55% (2014): $5097.73

It just so happens that my bigger loans are at higher interest rates, so I’m trying to pay those off first, and the bigger they get, the further away my goals seem.  I could go about it Dave Ramsey’s way and knock off the smaller loans first = snowball method, but the interest on the higher interest loans would hurt me.  So I just gotta keep chugging along.

Here’s a glimpse into what my massive spreadsheet looked like this month:

Student Loan Debt Chart - Mar 13
April Plan

  • Pay $352 minimum to Sallie Mae
  • Pay an extra $1000 to Loan 1-07 ($2,393.63) 
  • $40/wk. to VSAC Loans

Reflections Sometimes I’m a little too hard on myself.  I paid off a loan last month, and I’ll get this next one paid off in 4 months… not too shabby.  Maybe we’ll win the lottery in the meantime and I can stop ranting about my financial troubles.  In the meantime, getting these in my email sure do make my day:
student loan paid off
What is/was your strategy to pay off your student loans?  Did you pay off the higher interest or smaller loans first?

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

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6 thoughts on “42K x 30 – Month 5 Update

  1. That’s the way Uncle Sam works…does not reward hard workers 😦 No wonder the country’s so screwed up. If it weren’t for stock losses that we’re carrying over from last year and one I sold this year, we’d be probably be paying out too.
    With the promotion, have you adjusted your deductions from your W2? That way, it may not be that much of a shock at tax time next year. I never bothered changing the deductions with my raises/promotions before because owing just means that they got my tax $$ later 😉

    • I didn’t adjust my W2 post promotion, but we did change them when we had Avery, so we might need to have one of us claim single instead of us both claiming for avery…or something like that. taxes were so easy when it was just me! Now they are so complicated! I have enough to do thank you very much… add taxes to the mix and I’m a mess!

  2. We are paying off our highest interest loans first. I’ve read Dave Ramsey’s book, but to us, it just makes more sense to off the higher interest loans. Most of the time it doesn’t feel like we’re making much headway, but we now we’re actually saving money in the long run (vs. the snowball effect).

    • Good to know I’m not the only one going against the snowball idea. I understand the concept, and how paying off those small loans motivate u to do more, but my way of logging them once a month keeps my butt in gear, and blogging about them keeps me motivated, so to each his own – but glad im not the only one doing it this way!

  3. Nice to see you’re making progress. I look forward to the day I get one of those e-mails form Sallie Mae. Still quite a ways off as I consolidated everything.

    Keep it up and celebrate every victory!

    • Yeah, you won’t get that letter for a while, but make small goals. I was so thrilled when I got under 40K and it helps to pay off each goal, giving me other goals to work towards. How do you keep yourself motivated and make goals for yourself?

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