How This Woman Paid Off $53,000 in Loans in Just One Year

When Jen Smith of Saving With Spunk finished her master’s degree in 2012, she walked away with $61,000 in student loans, after interest ballooned her balance. But while her debt exceeded her income, Jen was motivated to pay it off as fast as possible. With an aggressive repayment strategy, she was able to pay off $53,000 of her loans in just one year.

Coming to terms with her debt

Like many people, Jen was overwhelmed and stressed out by her debt.

“My loan balance was more than I made in a year,” says Jen. “I couldn’t see a light at the end of the tunnel. It was hard to be focused because the debt seemed so big.”

But after she got married, her husband convinced her to work towards paying off the debt early. At first, Jen was nervous about the idea. She was afraid to give up her freedom to accelerate debt repayment.

“I didn’t want to live under a rock for five years while we paid off debt. It took me some time to think about it and analyze it. But I realized that paying off the debt faster was the best choice financially for what we wanted to do in the future.”

Creating a plan

Jen was ruthless in coming up with a strategy to pay down her loan balance. She realized that if they stuck with their plan, they could put more than half of their joint income towards debt repayment. In fact, they ended up putting 60 percent of their earnings towards their student loans.

She created a detailed budget, and she and her husband rented a cheap apartment to cut down on living expenses. They cut out extra spending by meal planning and buying used versus new.

“But the number one thing we did was take on as many extra jobs as we could,” says Jen.

Jen’s husband took on a number of odd jobs. Around the holidays, he decorated people’s home with Christmas lights and stuffed newspapers with advertising inserts.

“The first day he was covered with paper cuts, so he went back on day two with gloves,” says Jen.

Jen is a full-time acupuncturist, but she was contacted by a rehabilitation facility to provide her services two days a week at $75 an hour. That turned into an extra $600 a month they could put towards their debt.

Jen’s favorite side gig was babysitting at a group home for foster children. She assisted the house parent and took the kids out for excursions. This side gig provided extra income, but it also fueled their desire to adopt foster children and kept them motivated.

Staying the course

To help keep themselves focused on debt repayment, the couple got creative. They became mystery shoppers, so they could eat out or try out local events and get reimbursed for whatever they spent.

“It wasn’t a source of income, but it provided free dates,” says Jen.

And as a visual person, Jen needed something she could see every day to remind her of her goals. She created a giant thermometer that they put by the thermostat. They would color it in whenever they made a payment, to show how much progress they made.

Their hard work paid off; in just one year, they paid off $53,000 of debt.

What’s next

With her debt nearly gone, Jen expects her loans to be paid off this year. That will free up money for her other goals, such as traveling internationally and buying a home.

“We want to buy a fixer-upper. I like the idea of doing the repairs ourselves and creating the home we want.”

With that new home, Jen hopes to one day adopt children in the foster care system. The house she plans to buy will have space for her to provide a home and family for kids.

Paying off student loans

Jen knows what it’s like to feel like you’re drowning in debt, but she urges people to tackle the problem head on.

“When you’re starting out, it feels like you’re facing a huge dam. You can’t see the effect of your efforts just yet,” says Jen. “But if you stick with it, the dam will eventually crack and your hard work will snowball on itself. Keep plugging away – every little bit helps. Then you’ll look back and realize just how much you accomplished.”

By putting extra money towards your loans, you can take off years from your repayment period and save yourself hundreds or even thousands in interest payments. Putting just an extra $10 or $25 a month can make a big difference over time.

To find out how putting even small amounts towards your loans can help you pay off your loans early and save money, check out our prepayment calculator.

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