My marriage on September 10, 2011 brought many excellent changes to my life. I have learned more about myself, my faith, and my worth in these past 2.5 years then ever before. My wife has brought joy and laughter (as well as tears at times) and I am a blessed man to have her in my life. However, our marriage also brought about additional debt burdens from her schooling. It must be noted that I was fully aware of her debt load prior to marriage and accepted the challenge. We now fight this intense war as one!
In terms of weight, I brought $20,686 to the picture. This accounts for 25.75% of the total load, excluding the additional $35,000 that we are paying (as we go) for my wife's masters degree. Once we have cleared our name of school debt, we will have paid roughly $115,000. Here is a breakdown of our current path:
Starting Point
1. Federal Loan - $3,500 @ 6.8% - Paid in Full
2. Private Loan - 19,800 @ 2.98 - 12,446 remaining
3. Private Loan - $15,321 @ 4.23% - $10,888 remaining
4. Federal Loan - $21,032 @ 0% (deferment for school) - $9,697 remaining
5. Private Loan - $20,686 @ 6.55% - $7,376 remaining
Total Starting Debt = 80,339
Reductions (Principal)
Principal Paid on Original loans - $39,932
Current Remaining
2. Private Loan - 12,446 remaining @ 2.98
3. Private Loan - $10,888 remaining @ 4.23%
4. Federal Loan - $9,697 remaining @ 0% (deferment for school)
5. Private Loan - $7,376 remaining @ 6.55%
Total Remaining from Original = $40,407
While I do not wish this burden on anyone, in fact, I am working hard to educate and equip people so that they do not have to face this journey, I will say that I have learned a great deal from this trial. My wife and I mutually agreed that many of the principals that we have lived by during this period of war will continue to be present after we are done paying for school. I would go so far as to say that we will live richer lives because of our debt.
For those that are in bondage to debt, you can either choose to let your debt own you, or you can control your debt and build new muscles that you did not have before. Here are 3 strategies that we have employed that have resulted in significant growth for both of us:
1. Hate your debt, love each other, enjoy the present - For those that have talked to me, you know that I hate my debt with a burning passion. I am intense about. Yet, I have learned that I can still enjoy the life I have been given and the people that are in my life. In fact, it is often words of encouragement from others that continues to propel me to battle.
2. Become your own financial analyst and CFO - A financial analyst is around to make sure that budgets are accurate, people are spending according to the budget, and that the their is a sound financial plan for the future. In the same vein, a CFO uses past, current, and future information to develop a strategic plan for the company. During this time of bondage, build your financial muscle to ultimately grow your bottom line.
3. Long-term vs. short-term changes - Depending on your situation, I would advise different strategies. However, the strategy I will talk about is within the context of our unique situation. While we are intense about paying down our loans as fast as possible, we realized that we quickly burnt out when we tried to squeeze every cent out of our lives. For example, there were months we had a food budget of less than $100 which resulted in us scrapping for food at friend's houses, work, etc. Our best strategy has been to have an aggressive yet sustainable plan that will allow us to learn to live within our means in a sustainable manner while also killing our debt. This ultimately allows for our new financial muscle to positively impact our lives in perpetuity. For example, while we have a healthy food budget of $300 and an entertainment budget of $75, we are still able to live on roughly than $20,000 a year (including housing). This amount even feels a little excessive..
