It wasn’t designer clothes, fancy cars, or expensive hobbies. We didn’t start a business or make bad investments. It was just school. Law school. Oh yeah, business school too!
We were completely debt-free (and with a good tech job) before we felt that my husband should go back to school for 4 years for a JD/MBA. His scholarship covered a good portion of the tuition at a top 25 law school. We knew we would have some debt to deal with afterward, but education is one of the few things we felt okay about going a little in debt for.
What we didn’t anticipate, however, was the rate at which the tuition would go up each year, without a corresponding increase in the scholarship amount. For the second year, we qualified for in-state tuition, but the in-state tuition the second year was as high as out-of-state tuition had been the first year. Yikes!
During law school we lived frugally. My husband worked most of the time, which helped to cover living expenses. I stayed at home with our young daughter who was born the year before law school and our two sons who were born during the law school years. After the kids were in bed, I worked on my Etsy shop, which usually covered our food budget.
Deep in debt
In May 2012, upon finishing law school and an MBA, we had accrued over $130,000 in student loans. Outrageous! Believe me, I know. Seeing the total was quite shocking. During law school I avoided looking at the actual numbers during school because we “couldn’t do anything about it.”
Massive debt like this, is the norm though, at least with law school. Many young lawyers head to the huge firms where they work insane hours, but make six figures right out of school to pay off their debts. My husband had absolutely no interest in working at a big firm downtown. He was more interested in being around the family than making big bucks. And I was grateful not to go to bed alone each night.
In fact, at first we were in no hurry to pay off our loans at all. We were in the Income Based Repayment program (here’s why we chose IBR), so with our income and family size, we didn’t even have any payments due.
In fact, for the entire time we were repaying our student loan debt, our required payment was actually zero dollars because our income level was low for our family size. However, our unsubsidized loans were still gaining interest (and fast). While under IBR we were not required to begin paying off the loans, the total amount owed still increased as interest accrued.
A change of heart
At first, we weren’t sold on working to pay off our loans right away. We really wanted to save for a house. In November 2012 we paid off a small $4,000 loan just for the heck of it, but kept saving what little we could for a house.
Then in May 2013 I read Dave Ramsey’s Total Money Makeover
By the end of August 2013, we had paid off around $32,500. We got a head start, thanks to the money we had squirreled away for a future down payment. When I started Six Figures Under, we still had $104,000 to go (plus the rapidly accruing 6.8% or 7.9% of interest). You can see the current loan balance in the sidebar. Update: Except the loan balance is now zero, which isn’t very interesting, so we took it off the sidebar.
Thankfully we are both upbeat, positive, and enjoy a good challenge. We set a goal to pay off the loans by the end of 2016. This was a stretch goal because at the time, my husband was making $39 K, but we knew that with serious motivation and determination we could make it happen.
Is this TMI?
For most people, the idea of sharing the taboo numbers of earning, spending, and debt is just plain crazy. Well call us crazy, ’cause that’s what we’re doing! And honestly, we’re loving it and we’re so glad we decided to.
But this website isn’t just about us.
Sure, our personal story is woven throughout this blog, but more than that, SixFiguresUnder.com was created to be a resource for you! At Six Figures Under, you’ll find:
- Frugal Living Ideas— We share loads of frugal know-how to help you reduce your expenses in every aspect of life, from making your own dishwasher detergent to how to save money on road trips. We cook from scratch and share tutorials on growing and preserving food.
- Budgeting and Finance— We’re pretty serious about budgeting, so we share things like how and why we live on last month’s income and secrets to budgeting variable income.
- Debt— Of course paying off debt is a major theme, so we share how to get started paying off debt and how zero-based budgeting helps us pay off more debt. I also tell you not to do what we do in our debt repayment.
- Ideas for Increasing Income— We talk about everything from tips for starting a money-making blog to earning on Etsy and other things you can do on the side, like plan the ultimate yard sale.
- Motivation— Isn’t it nice to know you’re not alone? This is a positive, upbeat place where you’ll be inspired to embrace your season of life and be happy on any income, but you’ll be motivated to set goals for your financial journey.
Join us!
Join other readers who are committed to paying off debt and living frugally. We have a great community of readers here who will inspire and uplift you. In the meantime, you’ll pick up lots of frugal and financial tips for your own journey.
When you subscribe to Six Figures Under, you’ll get a free weekly email with some bonus material and a summary of posts for the week. You’ll also receive the “Guide to Getting a Month Ahead Financially” for free! This was a life-changer for us, and we hope it can be for you too.
UPDATE:
We are now debt-free! Get a behind-the-scenes look at our payoff complete with graphs, numbers, and other fun stuff like that! If you want to see the 7-step process we used to pay off debt, you can get all the details in my free Smash Debt email course.
Note: This post contains an affiliate link for a book that I wholeheartedly recommend! For more information, see my disclosure policy.
Thank you for sharing your story of paying off your loans!
Thank you for sharing. I just started exposing my situation anonymously. Fake names, but real numbers. I’m definitely checking out your course.
I was wondering if you have a favorite blog roll listed on your blog somewhere. Is there a place I can go to find similar blogs that you find useful or helpful?
Hello I find it amazing and wonderful that you used Dave and his ideas to pay off your debt. Me and my wife are just starting on this journey and we have over 120k in student loans but with no degree to speak of. Just really expensive schools and half way through a BA in Game Design(Do not recommend) lol Anyway Its awesome to see what you have done and its very inspiring.
wow I love your story and your blog site. Its pretty amazing what you guess are doing and the progress you have made. congratulations
Thank you for your transparency. It will help and encourage others.
I am so glad you decided to make a blog! I am working on my masters with a year left and my husband graduates in May with plans to get his masters and we already have over 100,000 in debt. I have seen many articles about people paying of “small” student loan debts like 30,000 and instead of inspiring me that scared me! Y’all having an amount similar to ours and a large family and paying it off is much more inspiring! I really needed to find your blog now. Thank you so much for sharing!
I totally know what you mean! Now that we are down to something like $55K with a year left of our huge goal, it feels like the “home stretch,” but it’s still way more than the average college student owes! 🙂 Thanks for sharing your story Amanda!
Reading your about page felt like I was reading my own story! Husband went to law school, we had three kids during those years, and now we are paying off a huge loan. I work online to make extra income and we use YNAB and have a huge garden!
I noticed you opted out of buying a house and instead are paying the loans off first. One strategy I have been looking at is buying a home now. If the home appreciates at the average 5.4% it has in years past (not including recession) then, by the time we pay off the loan, the home investment has appreciated enough to cover all interested accrued over the life of the student loans. Its obviously a risk since a 5.4% average is not guaranteed, but we have no other choice than to rent. And currently a mortgage would be about the same as our rent, so we are wasting that money every year that could be going toward this investment. Do you have any thoughts on this? Love the blog and can’t believe our lives are so parallel!
Congrats on your progress! You can get this done. I graduated from law school in May 2012, and my wife and I just finished paying off all of our debt totaling $162,000 ($129,000 of this was my student loans). You all are over half way there! It takes less time than you think. And, as you know, it feels great when your payments go more to principal as you pay down the balance.
Good luck!
Thank you, thank you!!! I found your blog while trying to figure out how to sell on Etsy… to start our emergency fund a la Dave Ramsey! I resonate with your story so much my Husband and I are also six figures in student loan debt and I decided to work for local government instead of American Express. We have two kids and are actually selling our house and moving further out of the city (luckily our jobs are out of the city) to narrow the debt buckets to just one – student loan. We are just $4,000 away from our consumer debt being gone and I am desperate to do what it takes to take down these student loans! I appreciate your upbeat attitude and your willingness to share. It was just the encouragement I needed to come across this morning. Blessings to you and your family on your journey, I’ll be reading!
Nice to meet you Tirzah! It sounds like you are well on your way to making serious progress on your debt! That’s exciting that you’re so close to being done with consumer debt. Keep up the good work! 🙂
I was wondering if you have a favorite blog roll listed on your blog somewhere. Is there a place I can go to find similar blogs that you find useful or helpful?
Yippy for you! I stumbled upon your website via Pinterest. After reading a bit I knew you must be a Dave Ramsey fan 🙂
I wish I would have heard about him 10 years ago! Converting my kids to him now. Best of luck! I know you’ll do it!
Your story is inspiring! Wishing you the best of luck.
Hi Stephanie! I just stumbled across your blog via pinterest and your family is an inspiration! My husband had $80,000 in student loans and we paid it off last year! It felt amazzzzing. Granted, we do not have any kids so the sacrifices we made were easier 🙂 Our biggest sacrifice was using our savings for a new, second car and throwing them at our loans. God has blessed us with 1 car and we LOVE making the 1 car thing work and hopefully we can for a long time 🙂 Keep up the good work and thank you for sharing your story and tips!!
Congrats on paying off those student loans Kerry! That’s awesome that you are making the one car thing work well!
Hello Stephanie
I really admire your drive, commitment and vision. Education is never wasted, but it can be very expensive.
I was really interested to read your philosophy on Tithing and although I don’t belong to any church, you’ve made me re-think my approach to giving to charities ( for the better) I’m now going to do my own version of Tithing each month, with charities both local and overseas benefitting.
I wish you and your family a very happy Christmas and blessings throughout 2015.
Holly,
England.
I’m glad I came across your blog. I too have those deadly student loans. Just thinking about them gets overwhelming! I will def visit your blog more often.
Thanks Lashaun! Best of luck with tackling your student loans. You CAN do it!!
Hi Stephanie,
Thank you so much for sharing your and your husband’s journey.
My husband and I are in the process of paying off my law school loans which started at about $150,000. (Unfortunately, I bought into the starting salaries that my law school advertised that would have made this a great investment!) When I graduated in 2010, the “biglaw” firms were liquidating and legal jobs were very hard to find. After a few firm transitions, I found the right fit for me. I am so grateful to have found a job in my field that I enjoy.
We have now paid off more than 50% of my loan balance. We are working hard to pay off my loans 4 years early. Every extra dollar gets put towards principal. By January 2016, we should be law school debt free!
Knowing that we are getting closer and closer to being free of this debt is encouraging. I try to stay positive, but some days my regrets do get the better of me.
That’s awesome progress Amy and that’s great that you’ll be done paying them off early. I know that it can get overwhelming easily and that sometimes regrets come naturally. I do that even about little things sometimes. My husband always reminds me that any energy spend worrying about or fretting over something you can’t change, is just wasted energy. When I catch myself doing that I try to force myself to redirect my thoughts and energies to something productive. He is better at it than I am, but I’m learning. 🙂
Thank you, Stephanie, for your kind response. I confess I could have made my point a bit less angrily! It’s hard not to react with a lot of emotion although I know you (and others) don’t mean to be hurtful. I really appreciate your thoughtfulness, and I do apologize for being hotheaded.
I’d just like to point out that even if your husband had taken a job in a big city, you would not be a single mom. My mother was widowed when I was a year old. It’s hugely offensive to me when women call themselves single moms when their husbands work long hours or shift work, or commute to another town. Yes, parenting alone is incredibly hard and so exhausting. But you have a husband. You are not a single mom.
Hi keb. I’m so sorry to have been insensitive. I hadn’t thought of it that way, but you are so right. Even with a husband working long hours, I know nothing of what it really means to be a single mom. I am incredibly blessed to have an helpful and supportive husband by my side. I’m so sorry that you lost your dad at such a young age. I can’t imagine what that must have been like for your family, especially your mom. Please forgive me for saying something hurtful. I’m off to change the wording now.
Thank you for the great tips on how to sell on etsy. The 5 part series is very informative. Like Dave says- you have to sell it all! After a $24 garage sale (over two days), I realized that there needs to be another way! I was even wearing my “I see debt, people” shirt during one of the sale days.
I was also debt free and then I decided to leave a good paying engineering job for grad school. You are right about that interest! 6.8% adds up quickly. The only good thing was being able to qualify (after 3 years of arguing with Bank of America) for a super low mortgage (the benefits of taking a drastic pay cut and working as a substitute teacher).
Which site would you recommend to build your website? I was thinking about using google or wix. I don’t want to do another FB page- I think it’s too much social media to keep up with for a small business. I’m making the samples now for a triple zippered bag but still working on a title since the search comes up with products that don’t match what I have. Any suggestions would be much appreciated!
Thanks!
Hi Nichole, that would be painful to have a 2-day sale and only make $24! If you’re wanting to sell handmade zipper bags, I would first focus on getting an Etsy shop set up, then after you have it going, if you want to build a website/blog too, I would recommend using WordPress. I hope that helps!
I guess I just, being a finance person, I can not fathom having that much debt for that small of income especially when you were debt free!!! Did he not love his job? Did he think he wanted to do a big corporate fancy schmancy city job and then thought better of it? You we’re debt free!!! Did he want more autonomy? Why not a phD? You actually get a stipend to go to school. I do wish you the best of luck and you seem really on top of things financially. Love your frugal posts. I actually found you looking up gardening things.
Hi Kathleen! Thanks for your comment. I’m glad you’re enjoying my frugal posts.
My husband never wanted a big corporate sell-your-soul kind of job. He likes working with people. He wasn’t sure exactly what kind of law he would practice when he first started law school. He also didn’t know his salary would be as low as it is (much lower than what he had before law school). He does like a lot of the benefits of working somewhat autonomously. Fortunately there is lots of room for growth with his business, but it does take time to build up.
There are some things we would change if we had it all to do over again, but we still would have gone the law school path, even though it meant debt.
I have a question about the cell plan you use now. My monthly amount that I pay for my phone is small, but then there are a ton of fees and taxes that make the overall amount much higher. Is this true with Republic too? Thanks!
Hi Jen! I’m assuming you saw my Republic Wireless review. The tax is really negligible. Our last bill (on the $10 plan) for one phone was $10.87, so $.87 of tax. No fees. Pretty sweet! Oh, and we paid taxes on the purchase of the phone, just like you would any purchase.
pretty inspirational story of paying down debt! I’m curious though…do you live on only one income?? i don’t understand how you can own a house, support three kids on that salary. Just curious!!!
Hi Rach! Thanks for stopping by. We do live primarily on one income. I do make some side income with my etsy shop and my blog. We don’t own a house though. We live in my in-laws’ basement right now. We added a kitchen and bathroom to their basement which already had a private entrance. They are generously letting us live here without paying any rent. Once we get our law school debt all paid off, we will save for a down payment on our own place!
Every month, we make a monthly “Debt Repayment Progress Report” where we tell everything we earned, spent and paid in debt. We’re open about everything, so you can see exactly what we do with our money. Here’s our June 2014 report. July’s will be posted on Wednesday.
Living frugally sometimes isn’t an easy task. Keep going and good job!
Great story and blog guys Love it!
Good Day and Grind On!
Very interesting story. Congrats on paying off so much so quickly! I’m curious as to why your husband decided to attend law school. Did he just really want to be a lawyer, or were you expecting his salary to increase? Do you still think it was worthwhile? Is he making more now than he did at his old tech job?
From a purely financial perspective, it sounds like it was a setback so I’m just wondering if there were other factors in play that led to making the choice to go to school.
You’re right JoDi. From a purely financial standpoint, going back to school was a major setback, to say the least. Not only did he give up working full time for 4 years, he is making much less than he did before and we have loads of debt.
He didn’t go to school to increase his salary or because he had always dreamed of being a lawyer. He went because he felt like he should get more education. It was a decision we prayed about and felt it was the right thing for us to do.
Even now, as we look back at what could have been, we don’t have regrets about him going to law school because we feel like that was what he was supposed to do. I realize that that might sound crazy to most people. In addition to the peace that comes from doing what you feel inspired to do, we have been blessed in so many ways through our law school journey and now as we work together to pay off our debt and build up a law practice. I can’t imagine it any other way.
Just found your blog and love it (and the name is awesome). We are also in six figure debt from college – but just undergrad. My husband’s loans were well over 100k for a career that starts out at less than 20k (but eventually pays quite well). And he decided against that career… And so now I’m in this mess with him 😉
Hi Kirsten! That is frustrating to be in so much debt for a career that pays so little at first. It sounds like choosing a different career was a good idea, financially at least. Best wishes in your debt journey!
Hi, Your story is compelling. I am getting ready to sent 2 kids off to college and I refuse to let them go into debt. That is quite a statement to make and I am sure the truth lies somewhere closer to some debt. I have been saving since they were babies and have 1 year of college saved per child. But here is my suggestion to you: Your story and your blog are well done and I think you would be a good candidate for crowdsourcing. Have you considered it?
Hi Diane! Thanks for your comment. I have actually never thought about crowdsourcing. My husband and I are both the type who like to do things on our own, without asking for help (call it “stubborn” or “proud”), so I think we would feel weird about asking others to contribute. Now if it was for a major unplanned expense like an accident or disease I think we would be more comfortable collecting donations, but since law school was a choice we made (even though it turned out more expensive than we planned) we want to be responsible for it.
If people give me money, I want it to be because they receive some benefit from me, not because they just feel sorry for me. Looking at my blog stats, sometimes I think “If I got a dollar from each unique visitor, we would be out of debt!” I feel like I provide great ideas, information, and insights on my blog (and I invest a lot of time into it), so I feel good about earning money from it (though it’s more like a penny from every unique visitor, not a dollar!). It’s definitely not as quick and easy as crowdsourcing, but feel like it’s well-deserved instead of a handout.
Thanks for your suggestion Diane. It’s nice to get ideas and feedback from others. I welcome any other ideas or suggestions!
Thanks for being such a wonderful inspiration! I recently graduated from law school as well, and woke up a few years later realizing that I was about $129,000 in debt, and the balance was dropping awfully slowly. My husband and I made a commitment to get very very serious about paying it off. Like you, we decided to start a blog for accountability purposes, which (so far) is working!
Here’s the blog: http://debtfreejd.com. We hope to be as disciplined and successful in tackling our debt as your family.
Welcome to the club DebtFreeJD! Congrats on deciding to get serious about paying it off! It’s a fun adventure for sure! Bloggin for accountability is great!
Thank you for posting the helpful information in your blog. However, I have been trying to figure out through this series if an individual with handmade items that wants to sell through etsy has to have an official business set up with a Federal ID number, deal with sales tax, etc. Or can you just declare income and expenses on your personal tax return as part of a hobby?
Thank you for your opinion. This is the one area that holds me back until I get more clarification.
Christine –
I tried to reply to most of your questions in the comment at https://www.sixfiguresunder.com/marketing-your-etsy-shop, but you ask one more great question this time.
You can declare business income and expenses from a sole proprietorship with your personal income tax. You can even do the same with a business entity if you set it up for income to “pass through” to you directly. Usually, though, you won’t declare it as hobby income. The IRS’s plain language distinction between businesses and hobbies can be found here: http://www.irs.gov/uac/Business-or-Hobby%3F-Answer-Has-Implications-for-Deductions
– Mr. SixFiguresUnder
Came across your blog the other day. I look forward to exploring it more. My husband and I are in the same boat when it comes to debt. Too much to spell out here, but if you are interested in reading about our story you can find it here. We are in the beginning stages of paying off our debt. http://youseeitimakeit.wordpress.com/
Now is always a great time to start Strand! Way to use your creativity to help pay down your debt. If you decide to try an Etsy shop again, I have a 5-part series on making money with Etsy, and one of them focuses on marketing.
I am excited to read more about your journey, and your tips for paying off your student loan debt. We are in the same boat as your family. We just finished law school a year ago. My husband had a good scholarship, but our tuition nearly doubled our second year of school, ouch! And by the time we finished law school we had three cute little boys too. Best of luck to you!
The way tuition went up really hit us hard too! We definitely didn’t account for that in our pre-law school planning.
How fun that you ended law school with three little ones too! 🙂 Thanks for following along! Be sure to comment about your progress too!
Hi Stephanie
Nice to meet you. Wow, I was very surprised to see that a lawyer’s salary in a small firm like that could be so low. You have a great attitude dealing with all of this.
You have a big debt challenge relative to income much like me. Our income is much higher but our debt is 2.5x as much. My husband also makes a lower wage and it’s variable so this can be difficult. He makes less than your husband and I find it way too low, a little over 30K. He went back to university to get his Real Estate appraiser’s certificate and he’s a licensed RE broker as well, although he doesn’t buy/sell properties anymore except for family.
Kudos to you guys, and I will be following your journey from now on!
Nice to meet you too and to know that our situations are similar even though the numbers are different.
My husband makes 30% of what he bills. The firm gives him a “draw” so that he gets paid the same each month. When his commission is constantly exceeding his draw, he will renegotiate a new draw. The firm keeps track of the commission he’s earned and what they’ve paid him. It is low, but has the potential to increase. He is responsible for bringing in his own clients, so it really is like starting your own business (without the overhead costs and huge risks). With the kind of law he practices, he will always be looking for new clients (not a lot of repeat clients, though word-of-mouth is very important).
The debt-to-income ratio is pretty great. Thankfully our expenses right now are lower than they’ll ever be since we don’t pay rent or utilities. As far as times to pay off a massive amount of debt, “now” sounded about right!
Glad I found your blog. My husband and I paid off over $70,000 in debt in less than 2 years. It feels so good to have the debt gone. We just finished baby step #3 and were already on baby step #4. We don’t have children yet, so we haven’t moved onto to that step yet. We actually had built a brand new house, but due to my husbands job we are moving back “home”. Instead of buying we are going to rent one of my parents farm houses and save a 20% down payment for a house. That is one mistake we made with our first home was not having the 20% down, and we were stuck paying PMI insurance. No thank you! We are sick of paying that extra $200+ a month towards absolutely nothing. Therefore, we are taking advantage of being able to get out from under a mortgage, and we are going to take the opportunity to save 20% down.
Great job paying off your debt! That’s awesome that you are saving for a down payment so you don’t have to waste money on PMI! Best wishes!
Amazing goal! Me and my husband is not living the good life too. With the rent eating half od the monthly salary we are amassing debt as well esp when theres an emergency. Money would sometimes cause a row on us and still is a problem. I wish that like you I can help with say doing some crafty things but I am just not that good in doing things. Goodluck and nice to stumbled upon your blog. #pocolo
Hi Merlinda. I’m sorry that you are having a hard time. In the beginning, I think cutting back your expenses is just as important as making additional income. Are there ways you can free up some of your funds to avoid increasing your debt?
Even if you’re not crafty, there are other ways you can be creative and earn a little extra. Here are is a list to get you started thinking. Best wishes!
Just want to add some encouragement here. We paid off a 60K law school debt too, in part by biting the bullet like you did and throwing a chunk of savings at it . Then we began “snowballing” all our other debts (car loans and such) one at a time into it until it was all paid off.
The day that debt died we felt like we had won the lottery–and you will too!
Good luck, and I’m so happy I found your blog.
Thanks for sharing Julie! I love hearing success stories! 🙂 It will definitely be an exciting day when we’re done!! Thanks for the encouragement!
Way to go on tackling that debt! As Dave sez ” If you live like no one else, later you can live like no one else!” . Plus you are teaching your kids the importance of money management (and lots of other meaningful things (and what is NOT meaningful).
Can’t wait to hear you do the debt free scream. It truly IS freedom Stephanie.
Thanks for the encouragement Shan. We are excited to tackle this debt monster!
Our kids are definitely learning to use resources wisely, to be grateful for what we have, and to be entrepreneurs (among other things).
You’re encouraging me. Our house loan is $136,000.00 which is right around your student loan amount. I don’t stay at home (yet?) and maybe we can pay that off way before 30 years if we plan well and live frugally!
You totally could do it earlier and you would save so much on interest!
Thanks for sharing your story! When we got married we had $70,000 in student debt, then bought a house and a car. I started reading Dave Ramsey’s materials in 2010, and we’ve been working to pay off our debts ever since on a youth ministry salary. Thanks for your inspiration!
Thanks Jessica. Your story is inspiring too! It’s amazing what you can do when you put your mind to it and approach it with a positive attitude. Thanks for stopping by 🙂
I just found your blog! I love your motivation to pay off debt. It’s actually refreshing in our world today where people often walk away from their obligations when things get too difficult. I’m always looking for ways to save money, and do better with our budget, and you have some great ideas. I used to make fun of my Mom and her frugal ways of reusing plastic bags, but now that I have to fit that into my budget, I understand. I support what you and your husband are doing! Hopefully, I’ll think of you next time I’m tempted to spend money on something that doesn’t get me closer to our financial goals.
Thanks for the encouraging note Aubrey! Like you, I used to look at people who were pinching pennies and think “I don’t want to be that frugal” or “That’s too extreme for me,” but changing a little at a time (and having some real motivation to do so) hasn’t been that hard. Paying off debt (and doing it in a hurry) isn’t the mainstream thing to do, but we feel like it’s right, so we don’t care if others think we’re crazy 🙂 Thanks for dropping by and making me smile!
I am so glad I stumbled across your blog! My husband and I are also trying to tackle 100,000 in 5 years. Until today, I have not been able to find any other families tackling large debt with a low/moderate income. Your site has been just the motivation I needed to keep pushing forward, knowing I’m not alone. Thanks for sharing your story and being so open and inspiring!
I’m glad you found me Danielle! It really is comforting to know that you aren’t alone. I look forward to hearing about your progress 🙂
I’m so glad we got assigned to the same SITStribe. I love what I’ve read so far and look forward to getting to know you better!!
Hi Krista! Welcome and thanks for following along!
I’m so excited to have found your blog! I have some grad school debt (about $50,000) and my husband is currently in vet school and will accrue close to $180,000 in debt when he is done in three years. We’re trying to make a plan to pay off my debt while he is still in school so when he is done we can focus on his debt. We have a little guy with another on the way and I have a feeling we’ll have yet another while he’s still in school, so it often gets overwhelming to think about all the expenses and the future, but I enjoy a challenge! 😉 I’m looking forward to reading through your blog!
You’ve got a great attitude Lisa! I like looking at it as a challenge too. That sounds like a great idea to get yours debt paid off while your husband is in school. You can do it!
Oh I’m so glad you stopped by my blog! I love your story (though unfortunate, I SO relate). Can’t wait to follow and see what else you have in store 🙂
It’s nice to be open about these things and find people to relate to. Thanks for stopping by and following along!
Best of luck to you and your family! I am also working on paying off a massive amount of debt (only five figures, but still) and appreciate the hard work and frugalness.
Thanks Tejana. I’m hoping we’ll be down to five figures by the end of the year 🙂 Good luck (or should I say “buena suerte”) on your journey as well.
First off, congratulations on paying down your debt! You certainly have me inspired. I do have a question that I can’t figure out. You say that your income is $39k and you were able to pay off $32.5k in such a short amount of time. How were you able to pay off such a HUGE chunk? That is mighty impressive and I need to start following your lead! I found you through moneysavingmom and will follow you to help me in my journey of paying off my debts.
Hi Laura! Thanks for your comment. I’m glad you found us. I hope we can encourage each other in our debt repayment journeys.
When we graduated from law school, we didn’t start completely from zero. We had saved some money (and had an emergency fund), not knowing what commission-based pay would be like. As it turns out, we are on a draw, so my husband brings home the same amount each month, even though the actual amount he earns fluctuates. The firm keeps track of whether his actually earnings are behind or ahead of what has been paid out to him. When he is consistently exceeding his draw, he will ask for an increase.
The first $4,000 that we paid toward student loans in November 2012, was a CD that had matured and was up for renewal. Since it pretty much matched the amount we owed on our smallest loan, we decided to just get rid of that loan.
Before we decided to get serious about paying our student loans off (which was May 2013), we were saving for a down payment on a house. Since our loan repayment schedule is based on our income, we currently have no actual payments due, just interest accruing. Because of that, there was no external pressure to pay off the loans first, and we really missed having our own house, so we started saving for that. In May we decided that getting rid of debt was a higher priority than getting a house (and getting into more debt because of it). In that one month we paid $17,000 toward the loans. Most of that was earmarked as our down payment. It was what we had leftover from our law school savings (what would keep us afloat if the commission thing didn’t work out well) and what we saved from Aug 2012-May 2013.
About $6,000 (of the above $17,000) we thought we were going to owe in taxes, but it turned out that we didn’t owe it, which was a huge blessing! We bought a small home in 2008 when there was a $7,500 tax first time homebuyer tax credit. Knowing that we would need to pay $500 back to the government every year for the next 15 years (and the balance if we sold the house before 15 years), we put that $7,500 in a CD and just let it earn us some interest. We figured that when we filed our taxes in 2013 we would owe the balance. As it turned out, the fine print said that if you sell your house for a loss (our house sold for $3,00 less than we bought it for), then the balance is forgiven. The $6,000 we had been holding onto to repay the balance of our first time homebuyer credit was now ours.
It was really hard to let go of that money that we had squirreled away, knowing that once we submitted those loan payments there was no way to get that money back or change our minds. There is no turning back. We will pay the loans before getting a house because we won’t get anywhere if we try to do both at the same time.
So it’s not magic, just serious commitment. This first year of debt repayment will likely be higher than future years, because we’ve already depleted our reserves. It was definitely a blessing to have had a strong start. We plan to keep the momentum up, even if the numbers aren’t as high.
Hello, Stephanie! I found you through Money Saving Mom. That is quite the mountain you are tackling. It’s wonderful that you are facing your debt head-on instead of ignoring it.
Thanks Luba! Yes, it is quite a mountain! I’m so glad we chose to make sacrifices and pay it down aggressively early in the game because it sure grows fast.
Hi there,
I saw your post on Moneysavingmom.com today. My husband went to a top 20 law school and I guess “got away” with only 90k! We are currently at 60k and my husband’s work sounds like yours – but mine is 100% commission with no benefits, but he’s around for his 2 young daughters. We are starting to rethink how we are going to pay them off. Not easy, but it’s doable (hopefully before our 4 &6 year old go to college!) Cheering for you and your family to kick some financial butt 🙂
Thanks for stopping by and cheering for us Sarah. 🙂 Congrats on getting away with $90K and paying a third of it off already! Having Daddy around is a big deal, not just for the kids, but for Mommy’s sanity as well!
Hi Stephanie! I commented right before you on Money Saving Mom’s post today and I was surprised to see how similar our stories are. My husband acquired $175k of debt from law school and he also chose to work at a small firm making a small salary instead of working crazy hours for a six-figure income. However, we don’t have kids yet so we have the advantage of my income, as well. I’m impressed you guys are living on what you are with 3 kids! I’m going to start following your blog. Keep up the good work!
Hi Courtney! I just went back and read your comment 🙂 That is so wonderful that you are down to $54K after only two years. That is AWESOME! I love that your motivation for making sacrifices and paying off the loans quickly is that you want to stay home with your future kids. Totally worth it! Thanks for following along! Feel free to chime in with your progress along the way!
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My firm has an office here and I work on cross-border transactions governed by U.S. law. Financially, the difference is that I’m able to live rent-free because the apartment is taking care of as part of the expat package. It’s such a blessing to not pay rent and get to use that money to pay down loans instead.
What a neat experience and a great way to pay off your loans! I’m sure you have lots of fun adventures abroad. I hope you get to go back the US occasionally to visit family 🙂
It’s not all that often that I come across another JD/MBA! I also started out with six-figures of student debt. Since getting serious about debt repayment (which involved a move to Asia!), it’s been so much fun to tally up my numbers at the end of each month and chart my progress. Looking forward to following your journey–despite knowing many law grads, not many are serious about (or able to) pay their loans off early. Good luck!
Gigi that is awesome! Thanks for commenting. Great job getting serious with your loans too! I’m interested to hear how you ended up in Asia as an American lawyer (and how it’s helping to make headway on your loans). That’s terrific!
Love your name 🙂 and your blog title! Good luck with your debt pay-off!!!
Just found your blog, love it! I, too, am struggling with law school debt making about the same salary as your husband in a rural area. The fact that you are raising a family on that income is definitely impressive and motivating!
Glad you found my blog! We can commiserate about law school debt… err, I mean encourage each other!
Your payoff so far is quite impressive. Good luck with the rest!
Thanks for the encouragement Kristia!
Good for you guys! I’m so excited for you and your journey to debt free! We’ve got a nice load of debt to dump too, so we completely understand the journey you’re on. Best of luck to you!
Thanks Laurie! It looks like we have a lot in common (besides debt)!