Sometimes I write these student loan entries and wonder what angle I’m going to take on telling my repayment story. Will I write about how painful it is to force myself to not go out and “play” at the bar with the rest of the adults? Will I write about how I don’t shop for clothing as often as I used to and how I find that getting certain clothing items at Wal-Mart is just as good as getting an item from a department store? Or maybe I’ll just write about how my repayment plan has evolved since I set it in motion at the very end of 2009.Today, I write something much simpler and much more exciting. As of about a week and a half ago, my student loan debt fell to $81 thousand which represents a total of $40 thousand repaid in loan principal and fully one-third of my initial student loan debt no longer outstanding. That’s huge! Sure, it’s only one-third of the way to repaying a gigantic amount of money and the $40 thousand that I’ve repaid in principal doesn’t account for the over $10 thousand that I’ve repaid in interest. But that’s okay! I’m really happy that I’m at this $81 thousand mark because I know the next “big” milestone is hitting $80 thousand in total debt outstanding which will be quickly followed by breaking out of the $80 thousand range and into the high $70 thousand range.
How much progress, you ask? Well, you can scroll to the end of this entry to read my standard boilerplate on these posts where I talk about how much debt I started with and where I’m at today. However, let’s think about this in terms of when I began this aggressive repayment plan back in December 2009. At that time, I owed a total of about $98 thousand; I’ve reduced the principal owed on that debt by $17 thousand in about 6 months. That’s tremendous progress! But what’s great about this repayment plan (and if you know anything about how loans work, you know where I’m going here) is that the more I repay, the less I have to pay in daily accruing interest.
In other words, when I began this repayment plan back at the end of 2009, I was paying something like $8.50 per day in interest to the New Jersey Higher Education Student Assistance Authority (NJHESAA). Today, I pay NJHESAA $5.38 each day in interest – a reduction of more than $3.00 per day. That’s huge when you consider that each payment usually hits the NJHESAA’s coffers every 15 days or so. That’s $45 more dollars every two weeks that can be applied directly to reducing my outstanding principal.
Stick around folks, I think the repayment plan is really going to heat up as the summer moves on…
In May 2006, I graduated from Rutgers University with a Masters Degree and $120,720 in student loan debt. I currently owe $81 thousand, which breaks down to $26 thousand owed to the New Jersey Higher Education Student Assistance Authority and $55 thousand owed to the United States Department of Education. Follow my student loan repayment story on JerseySmarts.com.