Not Interested

If the interest rate on my student loans was in the 1% range, I’d maybe think twice about paying them off at a much accelerated rate.

But 6.8% makes the decision easy.

And the grace period is up, which means that 6.8% is no longer just a number. It’s a monster:

“Interest never sleeps nor sickens nor dies; it never goes to the hospital; it works on Sundays and holidays; it never takes a vacation; it never visits nor travels; it takes no pleasure; it is never laid off work nor discharged from employment; it never works on reduced hours. . . . Once in debt, interest is your companion every minute of the day and night; you cannot shun it or slip away from it; you cannot dismiss it; it yields neither to entreaties, demands, or orders; and whenever you get in its way or cross its course or fail to meet its demands, it crushes you.” (J. Reuben Clark)

In all, we took out $33,500 of student loans.

In November, we paid off $11k.

This month we paid off another $6k.

And next month, we plan to pay another $8k or so.

That will leave only $8,500, which we plan to eliminate by May or June.

Getting rid of our high interest student loans is our financial priority #1. We’ve limited our spending in almost every way conceivable. From what we eat to what we buy, to what we do on the weekends, we’ve been trying not to spend money unnecessarily.

TheFieryOne and I don’t want money working against us, but FOR us. And now that the grace period is up, and that rabid, persistent thing called interest has been let out of its cage, we’re that much more dedicated to paying off these student loans asap.

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7 Comments on “Not Interested”

  1. Monica Says:

    Love the Clark quote you reference! Reminds me of my days at BYU, and my class in the J. Reuben Clark building. Good times.

  2. Kel Says:

    Those are some impressive numbers. Would it make much of a difference if you paid smaller amounts each month rather than lump sums every few months? (of course, you probably have cash flow reasons for your particular payment schedule.

    I have to start paying mine off soon! Need to come up with a plan of my own πŸ™‚

  3. frugalcpa Says:

    @Monica: It IS a good quote, isn’t it? Such a great description of something which is otherwise so subtle and widely accepted.

  4. frugalcpa Says:

    @Kel: Good question about lump sum payments. TFO’s grace period ended in November, which meant interest would start accumulating on her loans if we didn’t pay off the entire balance. So we did pay it all off the day before the grace period was up. Then we waited until just before the grace period was up on my loans (this month) to pay another lump sum payment. Now that interest is accumulating on the remaining balance of my loans, we’ll pay as often as we can. Good luck with your loans!

  5. Kel Says:

    Ahh, makes sense now!

  6. Freedom Says:

    Sounds like you are doing the sensible thing. I love your description of debt and that monster called interest. For those who are not able to pay mounting debts, lower interest loans have to be the key.

  7. Kenny Says:

    Wow. You’re doing great. I’d have had to move in with my parents out of college to get that much paid off that fast.

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