It seems like every week, there’s a new article on the virtues of minimalism and how people are living with less. While people are ditching their belongings and moving into tiny houses, it can leave you scratching your head, wondering what this fad is all about.
Minimalism, at its core, is a back-to-basics lifestyle where you focus only on the things you love and value, and ditch all of your unnecessary stuff. According to The Minimalists, “Minimalism is a tool to rid yourself of life’s excess in favor of focusing on what’s important — so you can find happiness, fulfillment, and freedom.”
Face it: As we grow into adulthood and get that first paycheck, that first new apartment, and that first new car, we are eager to fill up our lives with all the things.
Many people that subscribe to minimalist living claim they feel happier and enjoy their life, unencumbered by possessions they don’t actually need. But aside from all of those feel-good vibes, living with less could actually help you pay off debt. Here’s how:
Turn your extra stuff into cash
We accumulate a lot of stuff in the normal course of life. Books, computers, TVs, clothes, kitchenware — the list goes on. But how much of that stuff do you actually need? More importantly, how much of it do you use on a regular basis?
Approaching a minimalist lifestyle can help you re-evaluate the stuff you have. But instead of just trashing your old stuff, you can sell it to make money and pay down debt. Remember, another person’s trash is another person’s treasure.
To start, look at your belongings and ask yourself:
- Do I need this?
- Does it provide value in my life?
- Have I used it in six months?
- Do I already have something similar to this?
Answering these questions can help you decide what should stay and what should go. When you’ve created a “go” pile, it’s time to sell it! You can do that in a number of ways:
- Hold a garage sale
- Sell it online using Craigslist
- Sell it using the app OfferUp
- Use Facebook Groups to list your stuff
If you’re selling at a garage sale, make sure to give yourself enough time to promote the event. If you’re selling online, add as much detail to your post as possible before snapping some well-lit photos of your stuff.
Selling your old stuff can help you jumpstart your debt repayment and inspire a minimalist lifestyle. It did for Claudia and Garrett Pennington, the husband-and-wife team behind Two Cup House.
“Minimalism is our number one strategy for eliminating debt. When we started looking around at all the stuff we owned, we realized we were surrounded by stuff we never used,” says Claudia.
“Incidentally, we also had more than $200,000 in debt, of which $35,000 was student loan debt,” she adds. “So we sold all of the stuff we didn’t use and started paying off our debt.”
Minimalism can change your money mindset
When you decide to live with only the stuff that you need and that bring value to your life, your relationship to stuff starts to change. Retail therapy no longer feels as fun after a hard day at work. Bringing home random stuff from a conference or event no longer seems appealing, and the urge to buy the latest and greatest gadgets wanes.
This is where a minimalist lifestyle really holds its power. Minimalist living can transform your money mindset, including your relationship to money and how you spend it.
“After getting rid of thousands of things from our home, I had a completely different perspective on stuff. I used to swipe my credit card without thinking, bringing even more stuff home that we didn’t use often,” says Claudia.
“When we started going through the exercise of listing things on Craigslist and eBay, it completely changed my mindset. Selling our stuff took months and it was a great one-time exercise, but it’s not one we wanted to repeat,” she explains.
Downsizing is cheaper
Once you realize how to live with less, you may also realize that the other things in your life are no longer needed. For example, after getting rid of all of your stuff, do you really need a big place? Or two cars?
For Claudia and Garrett, they realized downsizing their life was a natural next step on their debt-free journey. They sold their 1,500 square foot house with a two-car garage and moved into a cozy (536 square foot), more affordable home.
“We kept about 20 percent of the items we had in the other house, but we find that there are items here and there that we no longer need. We’ve also eliminated a significant portion of our debt since we sold the other house,” says Claudia.
The effects of minimalism
Through minimalism, it’s possible to sell your belongings, pay down debt, shift your money mindset, and downsize to a more affordable lifestyle. Additionally, getting rid of your stuff can declutter both your physical and mental spaces, making room for more energy and ideas that can go to side hustles.
If you’re interested in minimalism, start slowly by evaluating what items you enjoy regularly in your life, and what things are just taking up space.
If you’re already rocking your debt repayment and taking cost-cutting measures, you may already be living a minimalist lifestyle by default. But if you’re feeling crowded by unnecessary clutter and are overwhelmed by stuff, minimalism could be a good way to reinvigorate your debt repayment journey.
Interested in refinancing student loans?Here are the top 8 lenders of 2020!
|Lender||Variable APR||Eligible Degrees|
|Check out the testimonials and our in-depth reviews!
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 2.94% APR (with Auto Pay) to 5.98% APR (with Auto Pay). Variable rate loan rates range from 1.89% APR (with Auto Pay) to 5.98% 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 February 4, 2020, 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 2/24/2020. 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 our student 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 SoFi.
3 Important Disclosures for Figure.
Figure’s Student Refinance Loan is a private loan. If you refinance federal loans, you forfeit certain flexible repayment options associated with those loans. If you expect to incur financial hardship that would impact your ability to repay, you should consider federal consolidation alternatives.
4 Important Disclosures for Laurel Road.
Laurel Road Disclosures
Laurel Road is a brand of KeyBank National Association offering online lending products in all 50 U.S. states, Washington, D.C., and Puerto Rico. Mortgage lending is not offered in Puerto Rico. All loans are provided by KeyBank National Association.
ANNUAL PERCENTAGE RATE (“APR”)
There are no origination fees or prepayment penalties associated with the loan. Lender may assess a late fee if any part of a payment is not received within 15 days of the payment due date. Any late fee assessed shall not exceed 5% of the late payment or $28, whichever is less. A borrower may be charged $20 for any payment (including a check or an electronic payment) that is returned unpaid due to non-sufficient funds (NSF) or a closed account.
For bachelor’s degrees and higher, up to 100% of outstanding private and federal student loans (minimum $5,000) are eligible for refinancing. If you are refinancing greater than $300,000 in student loan debt, Lender may refinance the loans into 2 or more new loans.
ELIGIBILITY & ELIGIBLE LOANS
Borrower, and Co-signer if applicable, must be a U.S. Citizen or Permanent Resident with a valid I-551 card (which must show a minimum of 10 years between “Resident Since” date and “Card Expires” date or has no expiration date); state that they are of at least borrowing age in the state of residence at the time of application; and meet Lender underwriting criteria (including, for example, employment, debt-to-income, disposable income, and credit history requirements).
Graduates may refinance any unsubsidized or subsidized Federal or private student loan that was used exclusively for qualified higher education expenses (as defined in 26 USC Section 221) at an accredited U.S. undergraduate or graduate school. Any federal loans refinanced with Lender are private loans and do not have the same repayment options that federal loan program offers such as Income Based Repayment or Income Contingent Repayment.
All loans must be in grace or repayment status and cannot be in default. Borrower must have graduated or be enrolled in good standing in the final term preceding graduation from an accredited Title IV U.S. school and must be employed, or have an eligible offer of employment. Parents looking to refinance loans taken out on behalf of a child should refer to https://www.laurelroad.com/refinance-student-loans/refinance-parent-plus-loans/ for applicable terms and conditions.
For Associates Degrees: Only associates degrees earned in one of the following are eligible for refinancing: Cardiovascular Technologist (CVT); Dental Hygiene; Diagnostic Medical Sonography; EMT/Paramedics; Nuclear Technician; Nursing; Occupational Therapy Assistant; Pharmacy Technician; Physical Therapy Assistant; Radiation Therapy; Radiologic/MRI Technologist; Respiratory Therapy; or Surgical Technologist. To refinance an Associates degree, a borrower must also either be currently enrolled and in the final term of an associate degree program at a Title IV eligible school with an offer of employment in the same field in which they will receive an eligible associate degree OR have graduated from a school that is Title IV eligible with an eligible associate and have been employed, for a minimum of 12 months, in the same field of study of the associate degree earned.
The interest rate you are offered will depend on your credit profile, income, and total debt payments as well as your choice of fixed or variable and choice of term. For applicants who are currently medical or dental residents, your rate offer may also vary depending on whether you have secured employment for after residency.
The repayment of any refinanced student loan will commence (1) immediately after disbursement by us, or (2) after any grace or in-school deferment period, existing prior to refinancing and/or consolidation with us, has expired.
POSTPONING OR REDUCING PAYMENTS
After loan disbursement, if a borrower documents a qualifying economic hardship, we may agree in our discretion to allow for full or partial forbearance of payments for one or more 3-month time periods (not to exceed 12 months in the aggregate during the term of your loan), provided that we receive acceptable documentation (including updating documentation) of the nature and expected duration of the borrower’s economic hardship.
We may agree under certain circumstances to allow a borrower to make $100/month payments for a period of time immediately after loan disbursement if the borrower is employed full-time as an intern, resident, or similar postgraduate trainee at the time of loan disbursement. These payments may not be enough to cover all of the interest that accrues on the loan. Unpaid accrued interest will be added to your loan and monthly payments of principal and interest will begin when the post-graduate training program ends.
We may agree under certain circumstances to allow postponement (deferral) of monthly payments of principal and interest for a period of time immediately following loan disbursement (not to exceed 6 months after the borrower’s graduation with an eligible degree), if the borrower is an eligible student in the borrower’s final term at the time of loan disbursement or graduated less than 6 months before loan disbursement, and has accepted an offer of (or has already begun) full-time employment.
If Lender agrees (in its sole discretion) to postpone or reduce any monthly payment(s) for a period of time, interest on the loan will continue to accrue for each day principal is owed. Although the borrower might not be required to make payments during such a period, the borrower may continue to make payments during such a period. Making payments, or paying some of the interest, will reduce the total amount that will be required to be paid over the life of the loan. Interest not paid during any period when Lender has agreed to postpone or reduce any monthly payment will be added to the principal balance through capitalization (compounding) at the end of such a period, one month before the borrower is required to resume making regular monthly payments.
KEYBANK NATIONAL ASSOCIATION RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE.
This information is current as of February 25, 2020 and is subject to change.
5 Important Disclosures for Splash Financial.
Splash Financial Disclosures
Terms and Conditions apply. Splash reserves the right to modify or discontinue products and benefits at any time without notice. Rates and terms are also subject to change at any time without notice. Offers are subject to credit approval. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet applicable underwriting requirements. Not all borrowers receive the lowest rate. Lowest rates are reserved for the highest qualified borrowers.
6 Important Disclosures for College Ave.
College Ave Disclosures
College Ave Student Loans products are made available through either Firstrust Bank, member FDIC or M.Y. Safra Bank, FSB, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.
1College Ave Refi Education loans are not currently available to residents of Maine.
2All rates shown include autopay discount. The 0.25% auto-pay interest rate reduction applies as long as a valid bank account is designated for required monthly payments. Variable rates may increase after consummation.
3$5,000 is the minimum requirement to refinance. The maximum loan amount is $300,000 for those with medical, dental, pharmacy or veterinary doctorate degrees, and $150,000 for all other undergraduate or graduate degrees.
4This informational repayment example uses typical loan terms for a refi borrower with a Full Principal & Interest Repayment and a 10-year repayment term, has a $40,000 loan and a 5.5% Annual Percentage Rate (“APR”): 120 monthly payments of $434.11 while in the repayment period, for a total amount of payments of $52,092.61. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.
Information advertised valid as of 1/1/2020. Variable interest rates may increase after consummation.
7 Important Disclosures for CommonBond.
Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown. All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 1.68% effective January 10, 2020.
8 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.
Subject to floor rate and may require the automatic payments be made from a checking or savings account with the lender. The rate reduction will be removed and the rate will be increased by 0.25% upon any cancellation or failed collection attempt of the automatic payment and will be suspended during any period of deferment or forbearance. As a result, during the forbearance or suspension period, and/or if the automatic payment is canceled, any increase will take the form of higher payments. The lowest advertised variable APR is only available for loan terms of 5 years and is reserved for applicants with FICO scores of at least 810.
As of 12/019/2019 student loan refinancing rates range from 1.90% to 8.59% Variable APR with AutoPay and 3.49% to 7.75% Fixed APR with AutoPay.
|1.89% – 5.98%1||Undergrad & Graduate|
|2.31% – 6.48%2||Undergrad & Graduate|
|1.93% – 6.68%3||Undergrad & Graduate|
|2.29% – 6.65%4||Undergrad & Graduate|
|1.99% – 7.06%5||Undergrad & Graduate|
|2.62% – 6.12%6||Undergrad & Graduate|
|1.77% – 6.25%7||Undergrad & Graduate|
|1.90% – 8.59%8||Undergrad & Graduate|