Tuesday, July 22, 2014

Paid in Full

I did something big last week.  Just over 5 years after finishing my MBA degree, I paid off my grad school loans in full!  Paying down these loans has been a major area of focus for me over the last several years so it feels good to see that balance (which was quite large as my MBA program was expensive) at zero. 

My goal for 2014 had been to pay the balance down by 2/3 but after thinking it over, I decided to use unused money from the relocation packages I received for my moves to Charlotte and Minneapolis, as well as some other money in savings to pay them off.  It made me a little nervous to use some of my savings to pay off these loans, but I still have another savings account to draw from if something were to happen.  Plus the interest rate on my loans was FAR higher than the rate I'm receiving on my savings account, so it was the right decision to use savings to get rid of that debt.

Paying off my student loans has been an obsessive goal of mine and I have been aggressively pursuing that goal.  I had been putting 1/3 of my take home pay towards my student loans for the last year+ so having them paid off is going to make a BIG difference to my cash flow!  People have asked what I am going to do with that extra money and the answer is that it will all go into savings so I can rebuild the balance I depleted by paying off those loans.  I do have a (large) savings goal in mind and once I reach that goal, I am hoping to plan a special vacation as a reward. 

I know student loan debt is viewed at "good debt" but it sure feels good to have that debt gone!  Now if the value of my condo could increase enough so that I could sell it and pay off my mortgage, I'd be 100% debt free!  But that will not be happening for quite awhile so for now I am taking pride in the fact that my student loan debt is GONE.

Are there any specific financial goals that you are working towards? 

22 comments:

Becky said...

CONGRATULATIONS!!!!!! SO proud of you!!!

Gracie said...

Congratulations! I remember how good that felt! My rate was very high at graduation (federal rate was 6.8%!) so nothing made more sense than to pay them off ASAP.
Enjoy that debt-free feeling!

Heather said...

Congratulations!!! I remember that feeling when I paid off my undergrad loans. Haha I just had that feeling when I paid off my credit card!

Caroline said...

Congratulations!! That must feel so good!

missris said...

Whoa this is huge! Congratulations!!! I'm with you--student loan debt did not feel like "good debt" to me, and having it paid off is a great accomplishment!

Jeanie said...

Good debt or not, it's debt. SO, THREE CHEERS for you! That is a huge big deal -- I wish the rest of the world was as responsible and wise.

Marlys said...

It is always a great feeling to pay off a debt! I know your loans were high so am very proud of your accomplishment! I would love to be debt free, but don't think that has ever happened in my lifetime!

Leigh said...

Congratulations! I bet that was a big relief when you made the last payment

A said...

Woooooooooooooo! Atta girl!

26dishes.com said...

That is so amazing and I am so happy for you!

Jolene - EverydayFoodie said...

Congratulations!!!! That is awesome :-) A financial goal that we are working toward is to pay off the mortgage within the next 20 years, and to have a cheap retirement property in somewhere like Las Vegas paid off in about half of that time. We've found some nice homes for about $20,000 in Vegas!!!! Craziness!

Abby said...

Congratulations Lisa! I know this was one of your 2014 goals and not only did you do it - you hit that one way out of the park! Awesome!

I'm going to sound like Dave Ramsey here, but financial freedom is one of the most rewarding feelings ever! (I don't think I'd be in "financial freedom" if it weren't for my prudent "CFO", however) ;)

Any ideas on your reward vacation?? France? Machu Picchu?

Amber said...

Amazing! So so happy for you. I know how much those student loans were weighing you down!

We are debt free other than our mortgage right now but we are going to be purchasing a truck VERY soon. We have a specific budget in mind for this purchase that means we can have it paid off in two years if we aggressively pay for it. Then our next goal will be to buy a house, so another mortgage. I doubt we will be free of mortgages until we are a lot older, but for now I will just be happy keeping other debt to a minimum!

The Many Thoughts of a Reader said...

We are putting our extra money into our mortgage but I think soon we will seriously consider putting it towards my student loan because it has a higher interest than my husbands, but we haven't been motivated to do it yet. We make a ton more money than we did starting out but we try to only spend like we did back then, so we pay a double mortgage payment so that it will be paid off in 2020. We also used to do a double car payment on my husband's truck after we paid off my car payment and one of his student loans. And sadly after we pay off my loans we may even put more on the mortgage ha. We like it allll to be gone. Or perhaps we will pay my car of early. But yeah, all that extra money always goes to savings or something else. But it's nice to know that if for some reason we got into a bund we could stop putting double towards our mortgage and have that money available plus the stuff in savings!

Stephany said...

What a huge, huge accomplishment, Lisa! I know how hard you have been working toward getting rid of your grad school debt. Way to go!

Kelly (She Wears a Red Sox Cap) said...

YAYYYY! So proud of you for doing this! It's such a good feeling to no longer have student loan debt!

Nora said...

that's amazing! Congrats, friend. Way to go you!!!!

San said...

This is huge, Lisa! Congratulations!

Raquelita said...

Awesome news, Lisa! Congrats on a major fiscal milestone! I'm on a nine-month contract in my current job, so I don't get a paycheck over the summer, but I'm looking forward to resuming double payments on my loans when school starts again.

Carolina John said...

Any debt is bad debt! Congratulations on getting rid of that one, I know it has been weighing you down for some time. That is quite the huge accomplishment, and I'm so happy for you.

Shoshanah said...

Congrats! This is definitely such, such exciting news!!

At the rate I'm paying my loans I still have about 4 years before their completely paid off. That would mean I paid off my grad student loans about a year early, and my undergrad loans about 6 years early. But I'm sure that I'll need to cut back on the amount I put towards my loans with the baby coming, so I guess we'll see. But given that I put pretty much all my extra money towards them, the idea of having so much extra money once they're gone is a little unbelievable!

Lauren @ Sassy Molassy said...

Awesome job, Lisa!! I am just happy to be making monthly payments on mine and getting the number down from undergrad loans, but as I start making more in the future, I really do want to pay them down faster.