Originally published Oct. 14, 2019.
When we start a new year, it’s easy to make grand resolutions about saving a bunch of money or paying off student loans in full. But when that New Year’s energy wears off, it’s harder to stick to our plans.
We spoke to four student loan borrowers to learn about the progress they’re making on student loan repayment in 2019, now that we’re heading into the final quarter of the year. Here are their big repayment goals, along with the successes and challenges they’ve met along the way:
- Goal 1: Paying off $70,000 in student loans in one year
- Goal 2: Paying off student loans two years after graduating
- Goal 3: Pay off $45,000 in student loans by the end of 2020
- Goal 4: Get a $35,000 student loan balance down to zero
- What’s your student loan payoff goal this year?
Heading into 2019, Money Life Wax founder Joshua Hastings and his wife Lauren had $128,000 in student loans between them. After paying off a massive $70,000 of their debt in 2018, the couple set the same lofty goal for 2019. While Hastings predicts they won’t quite reach that same level of repayment, he expects they’ll get close.
“Thus far in 2019, we have paid off $35,000 and some change, and we are on pace to pay close to $60,000,” Hastings said in August.
So, how did they manage to make such a huge dent in their debt?
“We have been able to do this by living off one income [and] using the other for student loan debt,” said Hastings. “This obviously meant we needed to make lifestyle adjustments in the areas of travel, entertainment, food and transportation.”
In fact, Hastings said that their tight budget would have allowed them to hit their $70,000 debt payoff goal, if it weren’t for an unexpected emergency expense.
“In March of 2019, we were hit with a $4,300 veterinary bill after our dog ate chocolate and spent a week in the emergency vet hospital,” said Hastings.
But Hastings says this big expense didn’t distract them from their goal, and that keeping focus on the long-term goal is the smartest way to pay off student loans.
“My biggest tip or piece of advice when it comes to paying off student loans: Don’t let distractions be your excuse not to stick to your goal,” said Hastings. “Had it not been for the doggy emergency, we would have been close to our very lofty goal, but we didn’t let that stop us the next month.”
When Jessica Granofsky graduated in April 2018, she owed over $30,000 in student loans. She found a full-time job a month after leaving school and made student loan repayment her top priority.
“I’m hoping to repay my entire loan within the next 12 months,” said Granofsky. “I’ve had to make some pretty big sacrifices because of my student loan.”
Among those sacrifices, Granofsky has forgone her own apartment in favor of living rent-free with her parents in the suburbs outside Toronto. While she’s able to put the money she saves toward student loans, this arrangement means her commute to work into the city is very long.
“I’ve been living at home in the suburbs, which means I commute three hours a day total,” said Granofsky. “This has allowed me to aggressively pay down my loan, since my only ongoing expense is my car and auto insurance.”
Despite the challenges of this arrangement, Granofsky says it’s worth it to pay off her student loans in full.
“I’m very confident that I’ll be able to reach my goals if I continue living at home, but it’s been a struggle to resist moving closer to work,” said Granofsky. “I was looking for rentals downtown but decided that while technically I could afford it, it would mean dragging out my loan repayment for another three to five years minimum.”
Because of the money she’s saving on rent, Granofsky has cut her student loan debt in half and is on track to pay off the rest within a year.
Matthew Burr, a student loan borrower and human resources consultant at Burr Consulting, also has a big repayment goal: to get rid of his $45,000 in debt by the end of 2020. After graduating in 2017 owing $117,000, Burr has already made a significant dent.
To accomplish this, he’s been successful at setting up multiple income streams, including income from the two consulting businesses he owns and from his work as a full-time assistant professor.
“Most if not all of my money from consulting goes directly to taxes and student loans,” said Burr. “Every time I receive a check, a section goes to loans.”
In fact, Burr is able to pay off between $2,500 and $4,000 per month to stay on track toward his payoff goals. He also focuses on reducing his expenses to make his student loan payments as big as possible.
“I limit my expenses to paying only bills, putting money into my retirement and into savings,” said Burr. “The rest goes directly to student loans.”
In terms of his advice for other borrowers, Burr says to avoid spending money on non-essentials if you want to aggressively pay down debt.
“I always ask myself: Do I really need this or do I just want it?” said Burr. “Focus on the need versus want and remain disciplined in your approach. Reward yourself after accomplishing your goals and continue to maintain the same level of discipline after you pay off the debt.”
After earning his bachelor’s and master’s degrees, Evan Lorendo had amassed close to $100,000 in student debt. Now, about a decade later, Lorendo is on his last loan, owing $35,000.
“My 2019 student loan payoff goal?” asked Lorendo. “Get my balance down to zero.”
As for how he’ll pay off so much debt in such a short time frame, Lorendo says his recent relocation will help. He and his wife, who have already lived abroad for the past 10 years, just moved from Australia to Tanzania.
“Moving from Australia, where everything is so expensive, to Africa means that our expenses were at least cut in half,” said Lorendo, who works as a remote business development consultant. “I will be able to up what I pay back each month.”
By reducing his living expenses drastically, Lorendo can pay at least $2,000 toward his loans each month. Although he’d rather hold on to thvat money, he says setting a deadline for debt repayment helps him stay on track.
“Commit to paying [your student loans] off in a certain timeframe, and you are more likely to get there,” Lorendo advised.
While these borrowers have audacious goals to pay off a large amount of debt in a short time frame, you might have another plan in mind. Maybe your goal is finding creative ways to pay off student loans or keeping up with your minimum monthly payments so you don’t miss one and harm your credit.
Or perhaps you want to find grants to pay off student loans or get your loans on income-driven repayment so your monthly bills don’t break the bank. If you have strong credit, maybe you want to explore student loan refinancing to save money on interest.
If you are thinking about how to pay off student loans in five years or less, use our “pay off student loans early” calculator to see exactly how much you’d need to pay each month to meet your goal (and how much you’d save on interest).
Whatever your situation, it’s important to set goals for student loan repayment so your repayment terms don’t drag on for longer than they need to. By setting a plan for your student loans, you can put yourself in control of your debt — rather than letting it control you.