Paying off $30,000 of student loans in under two years would be difficult for anyone. Doing it on an entry-level salary would be even more challenging.
A lot of stories about people paying off their loans focus on increasing incomes with side gigs or windfalls, but Garza paid off her debt solely by cutting her expenses and eliminating extra spending. Through persistence and diligently monitoring her debt, she was able to become debt-free.
Planning for graduation
Garza graduated from the University of Florida and, like millions of other students, she had significant student loan debt. But unlike other students, she started tackling her debt way before graduation.
“The thought of paying more than $30,000 in interest was sickening,” says Garza. “I didn’t want to put myself in the position of having thousands more added in interest.”
Even though her first payment was not due until six months after her degree, she started making payments while still in school. That helped her get ahead of the interest and start making progress on the principal before she even graduated.
Keeping the momentum
With a starting salary of $30,000, there was not a lot of room in her budget for extra loan payments — but Garza knew that paying the minimum would not make enough progress on the debt. She needed to stretch her budget to pay more against the principal.
Though her minimum payment ate up a good chunk of her income, Garza was determined to pay off her debt as soon as possible. She freed up more money by cutting her expenses to the bone.
She looked for housing that was less than she could afford to free up more cash for loan payments. That meant renting the cheapest apartment she could find, even though it wasn’t very luxurious.
“It was a $500 a month, one-room apartment with several roach roommates,” says Garza. “But it let me put everything towards debt. It wasn’t glamorous, but it was necessary.”
To furnish her home, she borrowed furniture from friends or picked up free castoffs off of Craigslist. She set a strict grocery budget and limited her entertainment to free events.
Garza also learned that everything is negotiable when she called her cell phone provider and other services to talk down her rates. She would call each in turn regularly to negotiate her plans and lower her monthly payments.
“It wasn’t so much about pinching pennies, but about not wasting them,” says Garza.
Garza admits that living on such a tight budget was hard, but it was worth it for her. She kept herself motivated and focused by taking meticulous screenshots of each payment to track her progress.
“Seeing the principal go down more and more was so encouraging,” says Garza. “Having those screenshots helped me when I was frustrated with my budget and debt.”
When she got married, she was even more intent on paying off the debt quickly.
“I didn’t want someone else to have to pay for my education,” says Garza. “I wanted to do it myself.”
Paying off the loans
After 19 months of throwing every extra dime at her debt, Garza paid off her loans in full. But it turns out her screenshots came in handy.
“After I made the last payment, I checked in one more time on my accounts. The loan company had added $1,000 to my account due to a processing error. Without my screenshots proving I had completely paid off my debt, I would have thought I owed that money,” says Garza.
Garza called her lender to have the issue fixed, and they corrected the $1,000 mistake. Then Garza realized she was finally debt-free, one year and seven months after starting her journey.
“It was a strange feeling. I had been so focused on paying off my loans for so long; it felt a little anticlimactic,” says Garza. “But not having that burden over me anymore was amazing.”
Finding financial freedom
With her student loans gone, Garza had the freedom to pursue the career she wanted. She is now a freelance writer, writing content about professional development and resume best practices for a diverse range of clients.
“Getting rid of the debt let me choose my own career path rather than getting stuck in a role I didn’t like,” says Garza.
Without a large income, Garza was able to conquer over $30,000 by watching her budget and eliminating extras. Being so stringent and focused helped her overcome her debt. If she had not kept herself on track, she would still be making payments on her loans and would owe thousands more in interest.
“It was not easy, but the sacrifice was so worth it,” says Garza.
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