When I began this debt payoff journey I was $200k in student loan debt, just starting my first year teaching, moving back home with my parents, and had no idea how I was going to manage this whole thing. I had a plan, I had a job, and I was starting to create some great side income streams. Then, the summer started. This should be the best time for a teacher, right? Wrong. No paycheck for 2 months when you have a $1,400 minimum loan payment to make each month is stressful. Of course, I had saved money throughout the school year for those two months in order to make at least my minimum. And of course I had some side hustles going on to bring in some income, but it was no where near my salary. That’s when I discovered using gift cards to get through the hard months.
When you don’t have your income like you’re used to, but you know it’s going to happen, it’s great, solely because you can plan for it. I was able to save enough money each month to cover my bills in the summer and start thinking creatively about my money. That’s the crazy thing about being in crippling debt, you start to think super creatively in order to get more money in your pocket.
About the same time I started to panic about not having my paycheck, I was also doing a huge purge of my things. I was hoping to sell some things to make some extra money. In the process, I found a TON of unused gift cards. That’s embarrassing to admit HA! I literally stashed them probably years ago and totally forgot about them. But, that got me thinking, why don’t I use these to help me in the summer?
So I survived my first summer without my salary and knew what I needed to do for the following summer. I saved each month for the summer so I could pay my bills and I hoarded every single gift card I received. Now, to clarify, if it was a restaurant one, or clothing, I didn’t necessarily keep it. The ones I kept were the ones that could be used anywhere, like Visa or Mastercard gift cards. And I absolutely kept Target gift cards because this teacher loves that place for back to school! So, what are the creative ways you have come up with to make ends meet when your pay isn’t consistent?
I started my debt payoff journey in November 2015 officially. That’s when my student loans officially went into repayment and I started throwing all of my money at my debt in order to pay it off as soon as possible. Since then, I’ve made many changes in order to increase my payments every month. When I first made my plan, my debt payoff date was just before my 31st birthday. My goal is to get that date closer and closer every month by improving my budget and increasing my income. I’m going to share with you all a breakdown of my loan payments and how I increase my monthly payment. I’m also hoping that by sharing with you all my goals, it will hold me more accountable to work towards them.
The summer is tough for teachers, I don’t receive my normal paycheck in the summer, I’m on a 10 month salary. That means my income is strictly from my side hustles. However, I do save $300 every month during the school year, so I can afford my debt payoff on a 10 month salary. Here’s a breakdown of where my money came from this month.
Fitness Coaching: $100.00
Summer School: $506.83
School Year Savings: $1,500.00
I save a lot in my expenses by living at home. I don’t have rent or utilities to pay each month, which saves me a ton of money and allows me to put a lot more towards my debt. My expenses here do not include my loan payments or my investment accounts. In July my expenses were $693, which includes my groceries and gas.
Loan Payments, Savings, & Investment Accounts
It might come as a surprise, but I actually contribute money every month to my savings and investment accounts. I know this is not typical for most people on their debt free journeys, but for me, while I am living at home, I am contributing $100 each month to my high yield savings account and investment accounts.
My current debt payoff date is September 2021, I’ll be 29 years old. I have been able to make significantly greater payments then I originally thought I could thanks to my side hustles. In order for this date to stay the same, I need to at least pay $3,166.71. My loan payment for the month of July was $2,473.92. This means I came in short this month, but considering I was working strictly from side hustles, I’m pretty proud of this number. This just encourages me to work even harder come September when I’ll have my salary back.
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When I first started my journey for financial freedom, my spending was out of control. I remember looking at my spending and thinking, “There’s no way I can lower any of these budgets.” I especially thought of this when looking at my spending for my groceries. It’s really hard to think about cutting costs when you think you’re doing the best you can at the time. You need to get creative sometimes and think about how you can get the most food for your money by learning how to lower your grocery budget.
1. Look at your current spending vs. food
The first thing I did was look at my old receipts. I never used to even look at how much items cost when I would buy them, I wanted to eat it that week, so I bought it. What I realized when I looked at them was that I was spending SO much on frozen foods and prepared foods. Now, ironically at the same time I was switching to an organic diet for health reasons. I thought I was going to be spending so much more (honestly I didn’t spend much more because I was buying everything fresh.) Frozen foods and prepared foods are crazy expensive because you’re paying for convenience. This also goes for veggies and fruits cut up, SO expensive.
2. Pick your meals for the week
I’m not saying go crazy meal planning. Just plan out what you want for breakfast, lunch, and dinner. Since it’s just me, I typically have the same dinners or lunches multiple days a week. It’s pretty difficult to cook for just one person and keep with correct portion sizes. So, I use my leftovers for the following days lunch or dinner, this allows me to plan, and buy, for less meals. Keep in mind what you found when you looked at your receipts, keep your meals simple and fresh to save cash. I also recommend making similar dishes throughout the week so you can use the same ingredients. For example, I buy a package of chicken breasts and ground turkey each week and make that work each week. I change up the marinade or the spice to add variety to my meals. When I was in grad school and living the serious broke student life, I regularly had rice, veggies, and half a chicken breast. It’s easy, healthy, nutritious, and relatively cheap.
3. Make a grocery list
Once you have your meals planned for the week, make a grocery list based on your meals. Once you have your grocery list made review it to see if it’s under your budget. If it’s not, revise your meal plan. Is there a cheap meal that you could make last more nights and get rid of a different meal? Do you have things in your pantry or fridge you could use to make a meal? Sometimes my meal planning and grocery list takes me quite a bit of time, but I’m always happy with my results once I pay for my bill. Take the time to plan well and it will pay off in the end.
4. Check deals at the grocery store
This is a tricky one. I don’t mean buy anything on sale. You should always stick to your list. However, if you notice that something is on sale this week that is a staple in your diet (chicken, rice, etc.) that you can freeze or has a long shelf life, buy more than you need. This will make your budget higher this week, but will save you in your monthly spending on groceries. I do a monthly budget, so if I need to take more one week to accommodate for this, I will. Also, I will make swaps in my grocery list if something similar is on sale. For example, if I wanted to buy grapes, but apples are on sale, I’ll buy the apples. These are snacks for me, so I can easily snack on a different fruit and try to find the cheapest one.
5. Use rebate apps
The three rebate apps I use are Checkout51, Ibotta, and Receipt Hog. Now, I never check my apps before I go to the grocery store, only afterwards. The reason I do this is because I don’t want to get sucked into buying things I don’t need simply for the rebate, that’s going to make me spend money unnecessarily. Ibotta is a rebate app that allows you to search the store, restaurant, service, etc (they even have Uber!!) that you’re using for cashback. You simply scan your receipt, click the rebates you’re claiming, and will get some money once it is cleared. Use my link to get a free $10 just for signing up! Checkout51 works exactly the same, but you don’t need to specify where you shopped. Receipt Hog is a little different, you just take a picture of your receipt and get points, once you have enough points you can claim it for cash back or gift cards.
These are the tricks I used to get my budget on track for my groceries. It might seem tedious and a lot of work, but once you get it going, it really is very simple. Plus, you’re going to save money in the end, so why not! How do you lower your grocery budget?
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Back in November of 2016 my debt payoff world came crashing down around me. My favorite debt payoff tool, ReadyForZero, was no longer going to be offering their tool. This tool had the works, everything I could have asked for, and it was free! I’ve spent months trying out new tools and just couldn’t find one quite like ReadyForZero and felt as though I was settling with the one I was using. Then, I stumbled upon undebt.it and my debt payoff once again feels organized and is motivating me once again. Here’s a review of my favorite debt payoff tool!
Many Different Options
One thing I really like about undebt.it is that there are different options of plans based on what you want from the tool. There is a free version that allows you to input all of your debt information, a customized payoff plan based on what strategy you want to use, and keep track of your payments on your accounts. The tool updates your totals for you once you add payments and allows you to see how much debt you have paid off and when you will be debt free, my favorite part!
They also offer undebt.it+, which costs $12/year and gives you access to everything that the free account gave you, and then so much more. With the plus account you are able to manage bills, get payment reminders via text message or email, an account summary emailed to you monthly, projections and stats to represent your debt payoff, and so much more!
This tool is incredibly motivating and makes it so easy for someone new to debt payoff. Once you input all of your accounts they create different plans for you and you get to pick which one is best for you and your situation. I personally use debt avalanche because I have such high interest rates and large loans.
They keep on every page you go to in the top right corner your current progress on your debt payoff. I LOVE this feature. I find it so motivating to see if the debt payoff day changes when I make extra payments and see the percentage paid off get larger.
Once you have picked your plan, they create a debt snowball table specific to your plan. I love this feature because it tells you exactly what to pay on each of your loans to stick to your plan. For someone who is new to debt payoff and not totally sure how to navigate it, this would be so helpful! I also love that your payments that you already made for the current month are in blue so you know exactly where you stand in the plan.
I really love this tool and I am so happy I found it finally. What I really love about it is that the creator of this tool was just paying off his own debt and needed a tool to use and he wasn’t happy with any of them out there. I love that he took initiative to help himself and so many others pay off their debt. I personally really like this tool and found it very helpful immediately after I set up my account. I highly recommend this tool, especially for people who are just starting their debt payoff journey and could use a tool to help them get started. One downside of the tool is that they don’t have an app for your cell phone. The website does load nicely on my iPhone, but no app is currently available. What tool(s) do you use to manage your debt payoff plan?
I’m going to be hitting my 2 year mark of this crazy debt free journey in November. Over those 2 years, I have learned and improved my plan a lot. One of the biggest ways I have improved is the amount of money I bring in each month. If you had told me when I started this ride I’d be making $1,200 every month just in side income, I’d think you were nuts. But, it’s true. Find out how I make an extra $1,200 every month.
By far the best way I have added to my side income is private tutoring in my town. If you have a skill you can teach others, I definitely recommend this. People are willing to pay top dollar for someone who is highly skilled in something they want to improve in. Personally, I am a certified as an elementary teacher, special education teacher, and a reading specialist. I get the most interest in parents of younger kids who are struggling to develop their reading skills. Once you realize what you can tutor, there are plenty of sites that can connect you with families and handle payment.
On top of private tutoring, I also tutor through the school I work for in two different after school programs. One focuses on homework help and requires no prep work for me (it’s actually wonderful to not have to prep anything) and the other focuses solely on reading and writing and students must meet certain criteria to attend. Both of these are great ways to earn a little extra at work. I would consider this to be similar to those of you that can earn overtime. I don’t get paid based on my salary, but it is still extra money.
I have so many different families I provide different kinds of services to. Some I strictly babysit for, some I strictly drive their kids around to different activities. It all depends on what the families need, but I have found enough families that I no longer need to find more and I just work when I can. I found some through my family friends and others through Care.com. This is a great way to make extra money, especially when you find families that you get along well with.
It definitely took me a long time to see this really become a steady source of income and I definitely can’t rely on it. However, there have definitely been some months recently that I ended up living off less than my side income and my entire salary went straight to my debt pay off. How do you make extra money every month?
Recently I have had some serious low blows in terms of keeping motivated during debt payoff. Things just don’t seem to be going my way and it’s making it hard to stay motivated. I’m extremely stressed at work this year, which is making me extremely tired. This then makes it hard to get myself to all of my side jobs in the evenings. I recently tried refinancing my student loans only to be told I have too much debt. Why thank you sir, I’m aware I’m drowning in $156,000 in student loan debt, but do you see that I’ve paid off $44,000 in 14 months?! I feel like my life revolves around my student loans and it’s been incredibly hard for me to keep pushing myself recently, especially after being told I can’t refinance because I have too much debt. However, there are some ways I do motivate myself when I feel like giving up.
Focus on your accomplishments.
The first thing I always do when I feel unmotivated is look at how far I’ve come in my debt payoff and remind myself I’m doing everything I can. I look at my monthly payments that I’ve made and see how much they have increased over the last 14 months. It’s important to acknowledge and celebrate the big and little victories in this long journey. I celebrated paying off my first loan this past year and celebrated breaking into 5 figures for my private loans. It’s important to do that to make this journey a little less overwhelming.
Recognize the sacrifices you’re making.
When I’m feeling unmotivated I remind myself about all the sacrifices I’m already making for my debt payoff. I remind myself that I’m already doing so much, I don’t need to do more than I’m doing right now. I work 4 jobs currently, live with my parents, and budget my spending each month. For my sanity, I need to remind myself that it’s enough, I can’t do more than that.
Find others who are going through debt payoff.
By far the most motivating thing for me to do is to head over to Instagram and Pinterest and find others who are working on their debt free journey. I find it so motivating to hear other people’s debt free stories and how they got to debt freedom. It can be hard to find people around me that can relate to my situation and want to pay off their debt, which is why the Internet can be a wonderful thing.
I hope these few things can help you when you’re feeling down on yourself about your debt payoff. I know it has helped me when I feel like I’m never going to finish paying this debt off. What are some ways you keep motivated when you feel like giving up?
I graduated from graduate school in August 2015 with about $200k in student loans from undergrad and grad school. My private loans went into repayment on November 2nd, 2015 and my private loans in March 2016. My debt free journey has been going on for exactly one year. I truly can’t believe it’s already been a year and I think it’s super important to reflect on my first year of repayment to see ways I can improve my current plan.
Amount Paid Off Including Interest This Year: $36,342.51
Total Principal Paid Off to Date: $37,264.73
Current Payoff Date: December 31, 2022
Debt Free Journey: How I Paid $36,342 towards my Student Loans in One Year
Sacrifices. As a twenty something who recently graduated from grad school, the first thing I always wanted to do was rent my first apartment and start my teaching career. However, I knew that wasn’t the best choice for my current financial situation. Instead I found a teaching job 20 minutes from my parents house and moved back in with them. This was the biggest way I have been able to pay off so much in one year.
Budgeting. This year I have really cracked down on my budget and tried to be very strict with it. This has helped me immensely to pay down my debt this past year.
Side Income. This was huge for me this year. Throughout the year I managed to add 4 different streams of side income through 2 different after school programs, private tutoring, and babysitting. At this point, I am able to almost afford all of my monthly expenses, except my student loans, with my side income. This has been amazing for my student loans because my salary can almost all go to my loans each month.
Debt Avalanche. Since I have such high interest rates, I have chosen the avalanche method. This allows me to focus on my highest interest, largest accounts first and then apply that payment to my next account. This continues until all accounts are paid off. This has been working out wonderfully for me. I paid off one account this year and was able to apply that payment to my next account making that payment even larger. This has helped my loans get paid off even faster.
Debt Free Journey: My Plan to Make Even Larger Payments
Budgeting. I plan to look at my budget even more and find more ways I can save even more each month. I’m trying really hard to search through my house and use what I didn’t know I had before going out and buying it. For example, whenever I run out of my favorite shampoo or conditioner, my first thought is I need to buy that kind again. Now, I’m looking through my house and bathroom closets to see if we have any kind of shampoo or conditioner that I can use instead of buying new.
Side Income. I don’t think I’m going to add any new streams of income, but I plan to do more within the streams I have. Right now, I only work 2 days at the after school program, but I’m planning to pick up any extra shifts I can and find more students to tutor and kids to babysit.
I’m very proud of myself for being able to make my money work for me and pay off so much of my student loans in my first year of repayment. My current goal is to finish paying off these loans by my 31st birthday, which would be April 29th, 2023, which means my current progress gets me paid off early! I’m so excited to improve my strategy and plan to pay off even more in the next year to pay off my debt even earlier! How much were you able to pay off in one year of repayment? What was your strategy?
Debt payoff can be tricky, especially when you’re on a pay schedule that doesn’t provide you with a paycheck every month. However, with some planning and budgeting, it can be easy to get around this problem. I’m a teacher and am on a 10 month salary, meaning I don’t get a paycheck during the summer months. But I was still able to make extra payments on my student loans in the month of July, with no paycheck from school. Continue reading to find out what I did to lower my debt by over $4k in the month of July.
Plan for the Months Ahead
It’s so important to plan and budget in order to make your debt payoff plan work for you. My monthly minimum payment is roughly $1,500 for my student loans, so I knew I needed to set aside $3,000 for my loan payments in July and August. This way I knew I had enough budgeted for at least my student loan payments in case I wasn’t able to find a job over the summer. So, $3,000 spread across 10 months is $300/month, it really wasn’t bad at all.
Find Side Hustles
Side hustles are the best thing ever. It’s always exciting to make extra money to put towards your debt. I know, that sounds crazy, but I seriously get a rush of excitement every time I make an extra payment and lower my daily interest I’m paying. I’m pretty sure these loans have made me a little crazy ha! But, I do after school tutoring at school during the school year and tutor local kids over the summer. I have also found a wonderful family to babysit for this summer.
I ended up not even needing that extra money I saved throughout the school year, as you can see from my July loan payment. I easily made my minimum payment of $1,500 and was able to payoff much more than that. It’s amazing what you can do with a little planning ahead 🙂 What have you done for your debt payoff on an unpredictable pay schedule?
One of the things I always read about on personal finance blogs was to financially prepared for the unexpected. You never know when something is going to happen that’s going to rock your budget and make you frantically scramble thinking how you’re going to afford this. This happened to me when I realized I broke even on my budget, before I even applied my extra student loan payment I make each month. Life throws curve balls at us everyday and it’s important to be financially prepared for them so they don’t hurt us as much.
June was an interesting month for me. I had two large unexpected expenses that basically was my entire extra student loan payment I plan for each month. The first one was my new teacher mentoring fee that goes to my mentor teacher, $550. The second was when I brought my car in for an oil change and they told me I needed all new brakes and two rotors replaced, see ya $955. The second was completely unexpected, and what really hurt my budget. I take my car in for it’s oil change and they always inspect the brakes for me. Everything was fine at my last oil change and suddenly 4,000 miles later, new brakes and rotors are needed.
This was hard for me and made me make a tough decision. I could either make my extra loan payment for June and pull the money from my savings, or not make my extra loan payment and not need my savings. My immediate reaction was to make the extra loan payment and pull from my savings because of my aggressive goal to payoff my loans by the time I’m 31. I looked at my savings and realized even if I did pull that $1,500, I would still have enough in my savings to last me a couple of months.
This made me decide to make my extra payment to my student loans in June. When hit with the unexpected, you need to closely look at your goals and decide what is most important now and for the future. For me, paying off my student loans as soon as possible is my most important financial goal. How have you planned for when unexpected expenses come up?