When Kasey Edwards graduated from college, she had $25,000 in student loans and dreamed of starting her own business.
While many entrepreneurs never get their companies off the ground because of their debt, Edwards was determined to pay off her loans as soon as possible to make her goals a reality.
Below, find out how Edwards paid off her loans in just three years before launching her own company.
Getting out of school
Edwards always knew she wanted to work in childcare. Determined not to take on too much debt, she took on babysitting jobs while she was in school for extra money. She and her friend Becka Klauber Richter worked as nannies, serving as each other’s backup when the other couldn’t make it to a shift.
“I was very interested in money, even in college,” says Edwards. “I read The Wall Street Journal every day, and I knew early on that capital was the key to freedom.”
Thanks to her hard work, Edwards was able to keep her student loan debt relatively small. She graduated from the University of California, Santa Barbara with $25,000 in loans, far less than the national average of $37,172.
Nannying through college convinced Edwards that childcare was what she wanted to do with her life. She saw a need in the industry that she thought she could fill with a new business concept. But to make her idea come to life, she focused on getting rid of her debt first.
“I did not come from money, I did not have lifelines or family to fall back on,” says Edwards. “To make it, I had to create opportunities on my own.”
After college, Edwards went to work as a private nanny for a family in Los Angeles. According to Edwards, nannies in LA can command salaries in the range of $50,000 to $60,000 a year. And because she spent so much time with the family and shared meals with them, her living expenses were quite low.
By keeping her monthly expenses small, Edwards was able to pay extra money towards her debt.
“I put every extra dollar towards my loans,” says Edwards. “I put about 10 percent in a savings account for emergencies, but every other penny went towards my student debt.”
By keeping up her hard work and maintaining her disciplined approach to her budget, Edwards paid off her loans in just over three years. In the process, she saved thousands in interest by repaying her loans early.
Launching a business
Without her debt, Edwards was able to launch her company with her friend and now business partner, Richter.
Edwards and Richter saw a need. Many other sites for childcare were overwhelming, and families struggled to find qualified sitters among the hundreds of listings in their area. Each sitter had different qualifications — some could handle exceptionalities and some could not.
The pair sought to create a platform where families could get consistent childcare for all children from qualified sitters.
She and Richter launched Helpr, an app that connects families with on-demand babysitters. All of the sitters are screened, interviewed in person, and CPR certified, so parents can have peace of mind that their children are in good hands. Helpr also does a personality test to ensure the sitters are truly passionate about caring for children.
With Helpr, screened babysitters arrive at customers’ doors within three hours, or families can book up to 90 days in advance. Helpr introduces customers to their sitters via photo, video, and profile, though families can also book a trial visit while they are home if they choose.
They also work with businesses to offer subsidized childcare to employees. Right now, Helpr is available in Los Angeles, Santa Barbara, and Orange County.
Focus on finances
For others who want to pay down debt and become entrepreneurs, Edwards advises discipline and focus.
“My advice would be to pay at least the interest each month while you are still in school,” says Edwards. “And once you graduate, pay extra on the higher interest first. If you live as cheaply as you did in school and avoid splurges, you can put so much more money towards your debt.”
By making extra payments towards your highest interest loans, you can pay off your debt and save yourself thousands of dollars in interest charges over the term of your loans.
Even putting just a little extra money towards your student loan payments each month can add up over time, cutting down on how long it takes to pay off your debt. Set up auto-payments to make the process simpler; if you don’t have to think about your payments, you will find it even easier.
To find out how much money you can save by paying off your loans early like Edwards did, check out our prepayment calculator below.
Student Loan Prepayment Calculator
Total Amount Paid
Time to Repayment
Original Prepayment Savings Monthly Payment — — — Interest Paid — — — Total Amount Paid — — — Time to Repayment — — —
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