Saying “I do” can be a big step in your relationship — but if both of you have student loans, it can also mean having a big debt load.
After saying “I do,” Jen and Ben Hayes found themselves with $117,000 in combined student loan debt — $75,000 from Jen’s degrees and $42,000 from Ben’s degree.
Jen’s first job paid so little, she was putting 50 percent of her income toward her student loans. Eventually, she got a new job with better pay, so she and her husband decided to take the next step in their marriage and start looking for a home to call their own.
The Moment That Changed Everything
Purchasing a home can cost a pretty penny. Once Jen and Ben began to look at the true cost of homeownership, they realized how expensive it would be on top of their hefty student loan debt.
“After running the numbers, we realized it was a terrible idea,” Jen says. “We were drowning in debt – our monthly student loan payments were as much as a mortgage, and we couldn’t afford two mortgages.”
Jen and Ben realized that if they went down the path of homeownership, while paying back $117,000 in student loans, they could easily succumb to the paycheck-to-paycheck cycle. Doing so would leave them on the edge of acquiring further debt, something they did not want to do.
Once their dreams of homeownership were dashed, Jen and Ben thought long and hard about what to do. They couldn’t exactly afford a home, but didn’t love the idea of renting, either.
Making Sacrifices to Pay Off Debt
After confiding in a friend about her situation, the friend recommended she read The Total Money Makeover by finance guru Dave Ramsey.
Reading that book changed their lives and was a lightbulb moment for Jen and Ben. They fell in love with the the Debt Snowball method, which focuses on paying off debt with the smallest balance first and paying the minimum on the rest.
Once Jen and Ben committed to paying off $117,000 in student loans in just three years, they knew they had to make some big changes. Jen and Ben decided to move in with her parents to save on rent, which saves them a lot of money each month. The money saving move isn’t ideal, as you can imagine.
“It is certainly a unique challenge living with in-laws,” says Ben.
Being married and living with your in-laws may be tough, but for Jen and Ben, it’s worth it.
“It’s not as bad as it could be,” Ben admits. “In the long run I know it will be worth it financially, and I am very grateful to them for allowing us to live with them.”
While moving in with the ‘rents ultimately helps their bottom line, Jen admits it’s still not enough to reach their goal.
In addition to living with her parents, the couple also practices extreme frugality and have found ways to earn more money on the side.
“We have a complete spending ban on nonessential items and outings with friends,” says Jen.
Even though they are on a spending ban, they don’t let it limit their fun. They still see their friends often and find frugal ways to have fun.
“We get together with friends often, but we have found free things to do with them – such as going to free yoga classes, having board game nights, and going hiking,” she adds.
Though the couple has found ways to be frugal and have fun, the spending ban is tough, particularly for Ben.
“My husband’s spending habits have been a big hurdle,” Jen says. “He’s naturally a spender, so it’s hard for him to be extremely frugal while we pay off debt.”
The couple combats this issue through accountability and communication.
“I curb my spending by having weekly budget meetings with my wife on what I am spending my money on,” says Ben.
The meetings provide much-need motivation for their debt repayment and keeps the couple on-task.
“This helps me track my spending habits and makes it easier to control my money,” he says.
Cutting back is just one strategy the couple has used, but they have also focused on earning more money as well. Jen admits they both earn an entry-level salary, so they have gotten creative with making extra money on the side.
To earn more money, Ben works as a freelance graphic designer, web designer and photographer while Jen earns extra income from freelance writing and through her blog Frugal Millennial.
Advice for Couples Looking to Ditch Debt
Throughout their journey, Jen and Ben have learned a thing or two about paying off debt. Getting out of six figure student loan debt requires discipline, patience, hard work, and most of all, forgetting about the status quo. Little by little, the couple started to notice their debt diminishing.
“I’m not the most patient person, and seeing those quick wins is incredibly motivating,” says Jen.
To make progress on your debt, you have to make changes in your life and not let others’ lifestyle influence you.
“You may have to do some things that other people won’t understand – like living with your parents (or in-laws), driving 20 year old cars, living in a less than desirable neighborhood, working a lot of overtime, or living extremely frugally,” Jen adds.
Living an unconventional life and letting go of things you “should” buy and “should” do can help you make progress on your debt.
“Stop caring about what other people think and do what works best for you,” she states.
Sometimes what is best for you may be out of the norm, and that is okay. While it may seem extreme to some people, Jen and Ben know they are doing what it takes to reach their goal of being debt-free in three years.
“I don’t care what other people think – if people judge me for driving an old car, not having nice things, or living with my parents, that doesn’t matter,” says Jen. “What does matter is that we will be debt-free in just a few years.”
Interested in refinancing student loans?Here are the top 6 lenders of 2018!
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1 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.89% APR (with Auto Pay) to 6.97% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 6.23% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of Month/Day/Year, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 08/21/18. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at email@example.com, or call 888-601-2801 for more information on ourstudent loan refinance product.
© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
Savings example: average savings calculated based on single loans refinanced from 9/2013 to 12/2017 where borrowers’ previous rates were disclosed. Assumes same loan terms for previous and refinanced loans, and payments made to maturity with no prepayments. Actual savings for individual loans vary based on loan balance, interest rates, and other factors.
Application detail: 5 minutes indicates typical time it takes to complete application with applicant information readily available. It does not include time taken to provide underwriting decision or funding of the loan.
Instant rates mean a delivery of personalized rates for those individuals who provide sufficient information to return a rate. For instant rates a soft credit pull will be conducted, which will not affect your credit score. To proceed with an application, a hard credit pull will be required, which may affect your credit score.
Total savings calculated by aggregating individual average savings across total borrower population from 9/2013 to 12/2017. Individual average savings calculation based on single loans refinanced from 9/2013 to 12/2017 where borrowers’ previous rates were provided. Assumes same loan terms for previous and refinanced loans, and payments made to maturity with no prepayments. Actual savings for individual loans vary based on loan balance, interest rates, and other factors.
3 Important Disclosures for SoFi.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
5 Important Disclosures for CommonBond.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.47% – 6.99%3||Undergrad & Graduate||Visit SoFi|
|2.47% – 6.23%1||Undergrad & Graduate||Visit Earnest|
|2.47% – 8.03%4||Undergrad & Graduate||Visit Lendkey|
|2.95% – 6.37%2||Undergrad & Graduate||Visit Laurel Road|
|2.48% – 6.25%5||Undergrad & Graduate||Visit CommonBond|
|2.72% – 8.32%6||Undergrad & Graduate||Visit Citizens|