Paying Off $88,000 Student Loan Debt in Harrisonburg, Va.

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Over the last several decades, the cost of education has gone up, but wages have remained mostly the same. As students and families have had to take out bigger and bigger loans in order to afford a college education, many struggle to pay them off long after leaving campus. That’s why nearly 45 million Americans share over $1.6 trillion in student loan debt.

Where you live while you pay off your student debt can make a difference. Saving on monthly expenses like rent or mortgage payments might help you make heftier payments on your student debt. Which brings us to Harrisonburg, Va.

More than half of Virginia’s recent college graduates have education debt, averaging above $30,000 apiece, according to The Institute of College Access & Success. Among them is 2019 grad Andrea Cable: She attended a small private school in Virginia, racking up nearly six figures in student loans.

Fortunately, Cable, 23, is one of the more motivated borrowers you’ll find. Thirteen months into repayment, she has refinanced her private loans to cut interest rates in half and has kept making federal loan payments during the coronavirus repayment freeze.

Despite having a debt more than double her annual salary, she hopes to be paid up by 2026.

Cable at a glance:

Andrea Cable

Age: 23
Salary: $36,400
Student loan debt: $88,292
Monthly payment: $1,200
● Born and raised in Pennsylvania
● Earned a bachelor’s in business administration from Eastern Mennonite University in Harrisonburg, Va.
● Works as a marketing coordinator for an insurance company and runs a photography side hustle
● Pays $300 rent with three roommates in refurbished Harrisonburg farmhouse

What’s it like living in your city?

I adore living in Harrisonburg, Va. Growing up in a small town in Pennsylvania, the idea of a farmer’s market, going downtown to shop or having neighbors relatively close by was a foreign concept. Although I live in the countryside, it takes me five minutes to drive downtown where lots of activities are.

What’s a day in your work life like?

Since working from home [due to the pandemic], I have a lot of flexibility with my job and its hours. I usually begin my job around 6:15 or 6:30 a.m. — early, I know. I do a lot of graphic design work for our company’s insurance agents, as well as maintaining the company social media profiles. I go into the office two to three days a week to scan in invoices, code the marketing invoices to our finance team and make sure our promotional items are in stock.

What’s your annual salary, and does it make your student loans affordable to repay?

My annual salary before taxes is [about] $36,000. I should be taking home $1,400 biweekly, but instead I take home about $1,000 biweekly. I feel like I get a lot of taxes taken out, so my net income is around $24,000 annually.

What’s your cost of living like?

I rent a [farm house] with three other girls. I pay about $320 in rent and utilities per month.

We’re kind of an anomaly in the fact that we pay so little in rent, but I do know that in Harrisonburg, the cost of living is just less than areas around it.

When did you start borrowing student loans and why?

I started borrowing my freshman year of college. Going to an out-of-state, private institution, I knew I was going to have to take out loans. My parents also made it very clear to me that if I were choosing to go to college, it would be my expense.

Something that we didn’t really know — my parents, my sister and I — we didn’t realize the cost of private loans. We didn’t realize the cost that that [would] put on us.

Student Loan Hero

When did you start repayment, and how equipped were you at that point to repay your loans?

I started my repayment last September [in 2019], about two to three months before I was “supposed” to. I just wanted to get a head start on the payments. I was pretty equipped to begin repaying, especially after I consolidated and refinanced my [private] loans through Earnest.

That has been a game-changer. If I wouldn’t have known [about refinancing], I would be paying almost double, just in interest from these private loan companies.

How did you learn about refinancing, and what was your experience like?

I did a lot of research after college as to how I could potentially lower my interest rate, and worked with a financial advisor who helped me narrow down my options. We worked together to make a payback plan, and he set me up with my Earnest account. From there, the customer service team took amazing care of me.

How much were you able to lower your interest rate and monthly payment?

Oh my goodness, I think I lowered my monthly payments by at least $1,000. The private lenders I went through were charging 11.00% to 13.00% interest — which should be considered theft — and I knew there were other and better options out there for me that I could actually afford.

I was speaking to some of my other friends, and they had 5.00% to 6.00%. That seemed to be the norm.

Why did you keep your federal loans out of your student loan refinancing application?

My financial advisor advised me [to], just because the interest rate was already pretty low on those. And if we were to [have consolidated] them together, the interest rate [on the refinanced] loan would have been higher with Earnest.

Ultimately, it would have made me organized — I would have had only one [monthly] payment. But I would have been paying a bit more in interest, so we decided to hold off on that for now.

How have you handled your federal loans during the pandemic?

I have still been making my payments [despite being eligible for CARES Act relief]. Interest just hasn’t been accruing, which has been great. I am [also] fortunate enough to have kept my job during the pandemic, which is wonderful.

I really hammered in on those federal loans just to make sure I could get [the balance] down during this time period … but I know that a lot of other people have had to pause their payments.

Cable’s loan repayment strategies
Do your research: “Every single private student loan company that I’ve gone through has had resources and budgeting tips, but I just felt like they [really just] weren’t as available as readily as they should have been. But Earnest has been great researching [questions] for me. And essentially, just Googling different opportunities for budgeting or saving money has been very, very helpful.”

Ask for extra help: “Get a financial advisor — someone you trust and [who] works with other student loan borrowers. Mine is a bit older than me, but understood the ins and outs of student loans, worked with me and my budget without judgement and made me feel confident that I can pay these back in an acceptable amount of time.”

Start a side business: “I have a wedding photography business I pursue on the weekends to make up for any extra expenses I have. … If people are looking for an extra way to make extra income, I fully recommend doing something on the side because it’s given me so much peace of mind, knowing that I have this income coming through the door consistently, but then I have my side hustle ebbing and flowing.”

Seek employer help: “The company I work for will pay [my grad school], so that’s a cost that I [won’t] have to incur.”

Budget your earnings: “My parents did drill into me and my sisters about the importance of budgeting and being financially aware of what we’re spending and what we’re taking in, not to have our expenses outweigh our savings.”

Consider refinancing: One last move Cable made that’s worth considering is refinancing. You could lower your interest rate or monthly payment (or like Cable, both), but be aware of the downsides of student loan refinancing too.

Andrea Cable

Also consider…

Student loan forgiveness programs

How to refinance Virginia student loans

You’re now about a year into repayment — how’s it going?

I have more [debt] than I’d like to admit, about $88,000 left. However, I started 2020 with about $95,000. I feel like I did a fairly good job in repayment this year, amongst a pandemic.

I really try to stick to my budget and pay as much extra as I can when photography season is in full swing, like right now.

What mistakes have you made during repayment?

It’s mostly just me not budgeting correctly. … I get paid biweekly, so every paycheck I put everything down [on my spreadsheet] and allocate it into these different funds.

But some weeks, especially over the pandemic, I was feeling really lazy and didn’t feel like budgeting. I just had money come out of my account — I didn’t know where my money was going for two to four weeks. It ended up in me looking at my bank account and seeing lower numbers than I wanted to because I wasn’t concentrating on what I was spending.

Does your side hustle help stave off debt fatigue?

It gives me a cushion, a little more spending money, and the freedom to be like, “OK, well, I have an extra $50 this month, so I can go out to eat with friends,” instead of always staying home and feeling left out. It gives me a good sense of financial security.

Small-city living seems to help your debt repayment — do you have any plans to move?

Harrisonburg’s rent is predictable for me at this stage in my life, so I feel like living in Harrisonburg allows me to have just a little bit of a nest egg, compared to living in [a big city where] I wouldn’t be able to have a savings or emergency fund. I’d love to move to a larger city while still early in my professional career. Ideally, I’d want to move to D.C. or Charlottesville within the next few years, just to experience city life.

[But] my loans are probably not going to be paid off yet, and it’s going to be a hard decision, whether I want to sacrifice a few more years of loan payments [to] move to another city.

What’s your longer-term student loan payoff goal?

I just want financial freedom, and I want to be able to travel and work from home at some point, to have flexibility to live my life and not be chained to a 9-to-5. I think that’s kicked me in gear to really look at my financial situation and want to whittle it down within the next 10 years at maximum.

I had the goal of paying off my loans in seven years. That’s kind of the cut-off point, May 2026, maybe December [2026].

Do you have student debt of your own? Tell us your story!
“Paying Off” is a Student Loan Hero series featuring borrowers across the U.S. We hope these interviews inspire readers to accelerate their own education debt repayment. If you would like to be featured, complete our questionnaire here. We’re seeking individuals who are willing to let us into their repayment, detailing any challenges and their plans to overcome them.

Here are previous installments in our series:
Paying Off $59,000 Student Loan Debt in Fort Worth, Texas
Paying Off $36,000 Student Loan Debt in Scranton, Pa.

This interview has been edited for length and clarity.