This is Part 2 of the 8 things we’ve done to pay off over $51,000 of student loan debt in 17 months.
Did you miss the first 3 things? Read it now >>
If you’ve read it, let’s get to it!
4. We Changed Our Mindset and Started to Believe
If I have the belief that I can do it, I shall surely acquire the capacity to do it even if I may not have it at the beginning.”Mahatma Gandhi
In the early part of our marriage and after graduating college (right at the peak of the Great Recession in 2008), we were not even close to making ends meet. With an annual cumulative income of under $45,000 a year and $200,000 worth of student loan debt, we had to move in with my husband’s parents.
For the longest time, we struggled to find work that paid enough to support ourselves financially. And get a job in a field we were actually interested in? Forget about it!
Our student loans took turns being deferred, so we could keep up with the monthly payments. This is why our total loan balance hasn’t gone down in 10 years regardless of all the monthly payments we’ve made. Majority of our payments only paid the interest, preventing the total loan balances from growing even more.
We were simply on survival mode. Any dreams we had of being debt-free, were simply that – dreams.
No matter how much we wanted to pay off our student loans, it was very difficult to think and believe we’d be able to pay it off anytime soon. We weren’t even sure how we’d pay them off by their original pay-off dates.
In our minds, it was something so unattainable. We eventually gave in to the thought that that was just our reality. We felt defeated and ashamed.
We weren’t all doom and gloom though. We would have pep talks that we would eventually increase our income and that we’ll one day be debt-free. But, in the backs of our minds, we didn’t really believe it then.
Instead, we had accepted that being buried in student loans for a very long time was just our reality. I mean, let’s be realistic, how were we going to pay off $200,000 in student loan debt on $14-16 an hour.
So while we dreamt it, we didn’t believe it. And I think partly because of this, we didn’t really try too hard to do anything about it.
We just dreamed, talked and created spreadsheets – but aside from seeking out job opportunities to increase our pay, we didn’t take any further action because we thought, it was just our situation – our reality.
But in the recent few years, after finally being able to move out of my husband’s parents’ basement (literally) and living on our own, we slowly began to see the light at the end of the tunnel… like it might actually be possible.
And paying off our two smallest loans instilled more hope that we just might be able to get out of debt.
Each step built upon each other.
Today, we are still about $100,000 in the hole, but we now believe that we CAN pay it off and we can pay if off quicker than we thought.
The momentum we gained made us believe we can do it. And, because we believed we could make it happen, we were more driven to actually take action. It pushed us to try harder and put in more effort.
In some way, I guess it’s like a self-fulfilling prophecy.
Because our mindset changed, we started to believe the possibility. So, we started to take baby steps toward our goal. And, seeing our progress got us more excited and motivated to keep going. And round and round it went. Now, we continue to do what we can to make our goal of being student loan-free a reality.
Take Action: While your situation might seem totally helpless and that there’s no way in hell you’ll be able to pay off all your debt, start changing your mindset. Even if you’re just on survival mode, like we were in the beginning, start putting in your mind that you can change things to improve your situation.
It can be hard – I know. But I do think that our mindset helps. I’ve recently started saying or reading affirmations to myself. You might want to give that a try. It doesn’t have to be complicated. It can be as simple as repeating “I am on my way to becoming debt-free” every morning and every evening. Try it for at least 30 days straight.
We all have to start somewhere, but we will only get to our final destination if we believe we can actually get there.
5. We Talked and Tracked
Monitoring goal progress is a crucial process that comes into play between setting and attaining a goal, ensuring that the goals are translated into action … Progress monitoring improves behavioral performance and the likelihood of attaining one’s goals.”Benjamin Harkin, PhD
We knew this journey was going to be just that – a journey.
And to keep going on our journey, we regularly tracked our progress through formal and informal money meetings or talks, writing in our journals, creating and updating spreadsheets in relation to our student loan repayment, and documenting our progress and lessons learned in this blog.
Early on, we had regular money meetings. Over time, they became less formal and less frequent, morphing more into money talks. Either way, we discussed how we were doing budget-wise and our progress against our student loan goals. We also strategized how we’d up our monthly student loan payments and talked about whether we were doing what we needed to be doing to get us closer to achieving our goal.
Constantly talking about it kept our goal and plans at the forefront of our minds.
And in addition to our spreadsheet collections 😉 , writing about our journey on this blog, has helped me get my thoughts in order and reflect on our actions and progress.
Tracking and seeing our progress helped motivate us to keep going and continue doing what we could to pay off our student loans. And it served as that reminder that we are moving forward and making progress when we felt restless with our situation.
It’s so easy to get sucked in to our daily grind and more immediate responsibilities, that we often put our larger, more long-term goals on the shelf for when it’ll be “less crazy or hectic.” Eventually, we forget about our larger life goals until weeks or even months have passed and we realize we haven’t made any progress toward them.
Doing all the things I just mentioned regularly kept our goal in our line of sight. Having this constant reminder of what we’re working toward kept us focused on what we were trying to accomplish and what we needed to be doing. And because we were constantly thinking about it, we’re constantly factoring it into our daily decisions and actions.
And lastly, when things got tough and we felt discouraged by how much we still had to go (and it did), it reminded us of the progress we’ve made so far. Yes, we still have over $100,000 in debt to pay… but that’s half the debt we started with.
Takeaway Action: It’s easy to set a goal and let our daily grind get in the way, only to find ourselves months later not having made much progress toward it.
Keep your goal top of mind. Keep talking about it with an accountability partner. Remind yourself what your goal is and review your plan regularly. Record your progress in a notebook, a spreadsheet, your journal, or a combination of these – whatever works for you so long as you track it. AND revisit it from time to time. This will help keep you motivated to continue hacking away at it.
6. We Practiced the Art of Delayed Gratification (as Best We Could)
The caliber of your future will be determined by the choices you make today.”Anthony ONeal
Working toward becoming debt-free, while raising kids in one of the most expensive cities in the country is hard. And paying off six-figures worth of it – well, you and I know it can’t be done overnight. It’s a marathon, not a sprint.
You have to make a lot of sacrifices to make it happen. For us, it meant:
- Not eating out as much
- Preparing freezer meals over the weekend to keep our take-out expenses down
- Not signing our kids up for some of the enrichment classes we’d like to
- Keeping mine and my husband’s clothes shopping to essentials
- Not going to concerts
- Finding free or low-cost family activities
- Pausing or keeping our monthly retirement contributions to a minimum so we can apply what we need to toward our student loans
- Not traveling like we have in the past
- Missing my brother’s wedding in Vietnam
And seeing a huge chunk of our monthly income simply go toward our debt ca be maddening!
But we just kept plugging along.
Our goal of becoming debt free is bigger than the short-term sacrifices we have to make today. We will be better for it.
When it got hard and we sometimes felt bad for ourselves (it’s happened), even resentful and defeated at times, we reminded each other that while it sucked (it still does), we could change it. And only we can do it. Our pity party won’t get us anywhere. But our persistence to make the right decisions today, tomorrow and the day after that will. Making the sacrifices we need to today, will reward us something much greater in the future.
Takeaway Action: You’ll have our own unique situation and challenges on your journey to becoming debt-free. You’ll feel frustrated about your situation, impatient that you may not make as a quick a progress as you’d like, or discouraged when you get hit with unexpected things that derail your plans along the way.
Remind yourself why you’re doing this in the first place and simply keep plugging along – just keep putting one foot in front of the other. Trust that the decision you make today will define and make your tomorrow. It’s in your everyday actions and choices that will lead you to achieving your goal or not. So, do your best to practice delayed gratification and put your long-term goals before your short-term wants and desires. You will be better for it.