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.
Interested in refinancing student loans?Here are the top 6 lenders of 2018!
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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 3.89% APR (with Auto Pay) to 6.97% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 6.30% 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 Month/Day/Year, 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 08/21/18. 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 firstname.lastname@example.org, or call 888-601-2801 for more information on ourstudent 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 Laurel Road.
Laurel Road Disclosures
APR stands for “Annual Percentage Rate.” Rates listed include a 0.25% EFT discount, for automatic payments made from a checking or savings account. Interest rates as of 11/8/2018. Rates subject to change.
Variable rate options consist of a range from 3.27% per year to 6.09% per year for a 5-year term, 4.64% per year to 6.14% per year for a 7-year term, 4.69% per year to 6.19% per year for a 10-year term, 4.94% per year to 6.44% per year for a 15-year term, or 5.19% per year to 6.69% per year for a 20-year term, with no origination fees. APR is subject to increase after consummation. The variable interest rate will change on the first day of every month (“Change Date”) if the Current Index changes. The variable interest rates are based on a Current Index, which is the 1-month London Interbank Offered Rate (LIBOR) (currency in US dollars), as published on The Wall Street Journal’s website. The variable interest rates and Annual Percentage Rate (APR) will increase or decrease when the 1-month LIBOR index changes. The variable interest rates are calculated by adding a margin ranging from 0.98% to 3.80% for the 5-year term loan, 2.35% to 3.85% for the 7-year term loan, 2.40% to 3.90% for the 10-year term loan, 2.65% to 4.15% for the 15-year term loan, and 2.90% to 4.40% for the 20-year term loan, respectively, to the 1-month LIBOR index published on the 25th day of each month immediately preceding each “Change Date,” as defined above, rounded to two decimal places, with no origination fees. If the 25th day of the month is not a business day or is a US federal holiday, the reference date will be the most recent date preceding the 25th day of the month that is a business day. The monthly payment for a sample $10,000 loan at a range of 3.27% per year to 6.09% per year for a 5-year term would be from $180.89 to $193.75. The monthly payment for a sample $10,000 loan at a range of 4.64% per year to 6.14% per year for a 7-year term would be from $139.65 to $146.76. The monthly payment for a sample $10,000 loan at a range of 4.69% per year to 6.19% per year for a 10-year term would be from $104.56 to $111.98. The monthly payment for a sample $10,000 loan at a range of 4.94% per year to 6.44% per year for a 15-year term would be from $78.77 to $86.78. The monthly payment for a sample $10,000 loan at a range of 5.19% per year to 6.69% per year for a 20-year term would be from $67.05 to $75.68.
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the variable rate will decrease by 0.25%, and will increase back up to the regular variable interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.
3 Important Disclosures for SoFi.
4 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.
5 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 2.28% effective October 10, 2018.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.47% – 6.99%3||Undergrad & Graduate|
|2.47% – 6.30%1||Undergrad & Graduate|
|2.51% – 8.09%4||Undergrad & Graduate|
|3.02% – 6.44%2||Undergrad & Graduate|
|2.69% – 7.21%5||Undergrad & Graduate|
|2.79% – 8.39%6||Undergrad & Graduate|