Monday, October 31, 2011

Debt Free by Thirty: The Plan

I recently decided that I want to eliminate my student loan debt by the time I turn thirty, which is twelve months away. Right now I have $9,188.92 to go.

Obviously I need a game plan.

Here's what I figured-

*Right now around $53 per month goes toward my principle payment (my total payment is about $80/month).
*I have $3,000 of loan forgiveness which should be credited by the end of the school year.
*I'm planning on putting my tax return toward my student loan. I'm planning for another $2,000 there.
*This leaves me with around $300 per month to pay on my loans to make this happen.

Yuck. I'm not looking forward to this, but I know I can do it. And with interest rates so low, even my Summer Saver only gets me 0.7% more in interest than I pay on my loan. So while I love the feeling of saving money, I also know that it's not much more beneficial to wait on my student loan.

If I go with this plan, I can keep contributing to my Roth IRA, my 403(b), and still save around $300 per month. And Dave Ramsey would be proud. It's "WWDRD?" approved.

8 comments:

  1. I think it sounds wonderful! It's realistic and do-able. Go for it!

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  2. You can definatly reach this goal with some buckling down.

    Are you going to follow Dave's recommendations to temporarily stop 401K, Roth IRA and extra savings ($300 per month)? Or are you going to keep all these while working to be done by 30?

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  3. This is an awesome plan--you can certainly attain this. Debt free by 30 is a fantastic accomplishment.

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  4. Great plan, Don't you just love good old Dave. When you are dieing they bring in rafts of specialists to see what they can do to save you. He is one of my specialists. But you do have to listen to them, take their advice, and then put it into action. I am proud of you.

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  5. I guess it's not exactly Dave Ramsey approved, as I am not going to stop contributing to my Roth, 403(b), or my savings. I think it's smarter to up my goals, but since I have $3,000 of loan forgiveness coming, I don't want to overpay. Also, I think retirement isn't something that can keep waiting, I want to be secure in the future. I have another post coming about how I'm modifying the "Baby Steps."

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  6. Awesome! You can do this! It takes hard work but it's so worth it when its paid off!

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  7. And thanks for the support everyone! I love the PF blogging community!

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