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When I graduated in May 2011, I was worried about my student loans.
I had just graduated from the MA in Performance Studies at NYU. For my BA, I had borrowed $ 23,000 and for my master's degree, $ 58,000. Between obtaining my bachelor's degree in 2006 and obtaining my master's degree, I treated my student loan payment as an invoice and I just paid the minimum.
But after several years of payment and debt, I graduated and I still had $ 68,000 left. Once I took my debt seriously and had to deal with my debt, I was able to make some progress and pay back the $ 68,000 that I had. I had less than five years left.
Here are the six strategies I had to get out of $ 81,000 debt.
1. I used the avalanche method of debt
My Grad PLUS loans had interest rates of 6.8% and 7.9%, while my undergrad loans had interest rates below 3% (I can not remember the exact amount). When I calculated how much money I was spending on interest, it was $ 11 a day. After that, I knew that I had to give up my high interest rate debt first.
I used the avalanche method of debt where I paid the minimum on all my borrowings, while injecting additional cash on my highest interest rate debt – loans to 7.9%. I kept doing this until it was paid off, then I threw extra money on loans at 6.8%, and so on. The avalanche method will help you save money on interest over time, which may mean you need to focus more on your main balance.
2. I made payments every two weeks
One thing I did not realize about student loan debt is that interest runs daily. In order to fight against the growing interest every day, I changed strategy. Instead of making the required monthly payments, I made payments every two weeks. I've divided my monthly payment in half and paid this amount every two weeks. This has helped keep the interests easier to manage without even having to pay more.
3. I put my energy to earn more
After graduating and not finding a full time job, I moved to Portland, Oregon. I have reduced my expenses by half, but I have always found only temporary work earning between 10 and 12 dollars an hour. I had reduced as much as possible. It was then that I realized that if I wanted to make real progress on my debt, I had to focus on winning more.
I started to jostle me by all means. I've worked as a brand ambbadador, as a public face of a company during public events. I sat down for my colleagues, I found concerts on TaskRabbit, like helping someone to move, and once, I found a concert on Craigslist where I ended up by selling bottles of water all night during an underground dance party.
The holiday season was particularly lucrative. I've worked for a wealthy family by attending their Halloween party. I have worked as a locker room for holiday parties. I sat down during Thanksgiving and distributed appetizers at Christmas. I would do any concert I could find. I put all this extra money for my debt.
4. I took advantage of free articles
One way for me to keep my expenses down was to take advantage of free stuff. I've been fortunate to get free samples of soap, coupons for food items and so on. with the burden of my ambbadador.
I started working as an event badistant for a congregation. On this side, there were many leftovers of food and wine, which reduced my food budget.
If I had to shop around and buy something, I was looking for free coupon codes by typing "[company] + promo code "Taking advantage of the benefits of free, my expenses have remained low.
5. I put my money back on my loans
If I had to spend money for something, I wanted to make sure to earn money in return. When I made my purchases online, I used Ebates, a site where you can get cash back at some retailers.
I also had the Capital One Quicksilver card, where I had 1.5% cash back on all my purchases.
These are the best cash-back credit cards of 2019 »
I took over the money that I received from Ebates and my credit card and badigned it to my student loans.
6. I have adjusted my tax withholding
Like most people, I was excited every year to receive a tax refund. But then I realized that I better adjust my tax deduction and increase my salary each month. So, instead of receiving a lump sum once a year, I would have more money to work with each month. I used this extra cash reserve to invest more in my student loans.
Becoming free of debt has been one of the greatest joys of my life. It was not easy or glamorous. It took a lot of dedication and hard work. By using these six strategies, I was able to streamline the debt repayment process and get out of debt faster.
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