Countdown to Student Loan Freedom – 120 Days to go

Jen SmithBudgeting, Personal Finance8 Comments

Best Summer Ever

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We’re putting 59% of our total income toward achieving student loan freedom. Want to see the budget we’re using and how we’re spending the other 41%? You’re in luck.

When I say we paid off $53,000 of student loan debt in a year people are flabbergasted. They think it’s awesome but they always have an excuse as to why they can’t do it.

“My loans are three times as much as yours.”
“I have a kid, I can’t work any extra hours.”
“I literally can’t think about my loans, it gives me anxiety.”

We don’t have lucrative jobs, we didn’t come into any money, and we’re not smarter than anybody else. We have as many barriers in our way to becoming debt free as most people.

But every decision we make is consciously directed at becoming debt free.

Current obstacles:

Employment: We don’t have six-figure salaries, we don’t even hit it when you combine our incomes. Travis is a mechanic and I’m an acupuncturist. We’re just starting out in our careers so we may hit that one day but it won’t be in the near future.

Also, my primary job doesn’t give me full-time hours. I work 20 hours per week in the field I have my degree in. Which means I have to fill the rest with part-time jobs that don’t pay as well.

Our House: Buying a house is not a good idea when you’re in the middle of your sprint to pay off debt. Not only are our bills more expensive but it’s hard to see ugly furniture and empty rooms in our beautiful house.

We love our home and have no regrets about purchasing it, but I don’t recommend stopping a speeding train to scratch the house itch. It’s dangerous for even the most motivated individuals.

Family: I’ve had some notable family drama this year that’s made me ponder, “how much help is too much when helping a family member financially.” I’m still in the process of figuring it out.

What’s the secret to getting over any hindrance?

I believe it’s by making your weakness your secret strength.

Being underemployed makes me hustle harder to find better-paying side jobs and ultimately why I started this blog.

Besides viewing our house as an investment we take advantage of our space and invite people over instead of going out. And realizing the importance of financial literacy has made me an advocate for open conversations about money in families.

The excuses I hear from some people are the advantages I hear from others. My advice is to identify what’s holding you back and consider how you can let it empower you.

This Month’s Budgeting App

I’m still looking for my favorite budgeting app, one I can endorse and rave about. Currently, it’s EveryDollar, but its lack of automatic transaction updating in the free version keeps it from being perfect. Everything else is exactly what I need.

This month I’m trying Mvelopes. The free version has all the options I want and enough “envelopes” for all my categories.

My favorite thing about it so far is that it can track your income. We have irregular income deposited in a few different ways so it’ll be nice if the app can remember how I labeled them and tag them as income so I don’t have to guess at it.

I’ll be comparing EveryDollar vs. Mvelopes this month to see who comes out on top.

Our Budget

May Budget

Our goal is to be debt-free on August 31, 2017. To do that we’ll need to pay $3,740 per month. That’s 59% of our projected income for this month.

This time last year our housing & bills took up 13% of our budget, now it’s 24%. The rule has long been to not spend more than 30% of your income on housing and some even say only 25% of your take-home pay.

I want to spend as little as possible on housing and still be comfortable. We lump our utilities, electric, and mortgage and want that to be under 25% of our take-home pay. The less you spend on where you’re sleeping the more you can spend on living! (or paying off debt.)

Our Goals for This Month:

Stick to the budget! That goal always bears repeating. We’ve been doing this a while but we never have the perfect month or budget.

Having all the information about our income, bills, and disposable income is invaluable. So even if we’re not perfect, if we hit our debt payoff goal and spend less than what we bring in, we’re doing it right.

Our Goals for the Next Budget:

Increase giving. I’d like to give at least 4%. We may not make it there next month but we’ll look at what we can shave off of food and lifestyle to bring us closer to what we were giving pre-house.

Our Long-Term Goals:

To stay on track. Now that I’ve disclosed out debt-free date I’m now held accountable to it! If we can maintain this payment we’ll definitely make it.

This summer is going to be really tight. We have a lot of fun stuff planned for September through the rest of the year but we’re not going to spend much this summer.

So I’ve made a Best Summer Bucket List to make sure we have as much fun as possible with little to no money spent. My idea is that if we can hit everything on the list we won’t have time to get jealous about the trips and things our friends are doing.

If you want the pdf download of my bucket list, click here and I’ll send it to you!

Tell Me: What’s in your budget this month?

120 Days til Debt Free

8 Comments on “Countdown to Student Loan Freedom – 120 Days to go”

  1. You sure do have obstacles. We just became cc debt free…next is equity line and student loan! When it comes to helping family remember… giving financially isn’t always helping.

    1. Congrats Lisa! I definitely feel you on helping family financially. It often hurts more than it helps.

  2. That’s so awesome! You’re so close. We are working on paying off our credit card debt we accumulated while I was pregnant with my daughter. We had a complicated, high risk pregnancy which required 2-3 doctor visits a week and three hospital stays before we even had her! Let alone the bills of labor and delivery. Then add in to the fact that I was on bed rest and out of work for almost 6 months. So, needless to say, we are trying to play catch up now.! You’re such an inspiration. Thanks for sharing.

    1. My goodness! That sounds exhausting. But totally worth it! Keep plugging away mama, you’ll have it paid off before you know it!

    1. I would love to help you in anyway I can! You can sign up for my weekly tips & encouragement emails or ask away in the comments.

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