Month 10: -$114,996.45
I’ve added a savings section to these reports. I also changed the format of some of the graphs to make them more clear. Every month that I update this, it motivates me to conquer debt and improve my future! I hope it helps you as well.
If you want more detailed information, check out November’s payoff report. Remember, calling this “Month 10” is a misnomer. This is year 5 & Month 10 of payoff. Last month I made my first ever principal payment on these loans, thanks to refinancing them. I’m so excited!
Extra Income This Month
Affiliate links are used in this post, and most posts here on WMSB. If you click on a link and make a purchase, WMSB receives a small commission. You don’t get charged a penny more for this, but it keeps WMSB running, and makes my debt repayment happy.
Amazon Affiliate: $12.52
SiteGround Affiliate: $0.00
Day Designer Affiliate: $8.85
Ebates Cash Back: $0.00 sent quarterly (If you sign up using this link, you’ll receive $10!)
Sponsored Posts: $90.00
Side Hustles: I’ve earned the money, but it won’t be paid for awhile. I’m cutting back on tutoring this year to focus on work and this blog, but I do enjoy it. In the past, I’ve made $1,000+ per season. This year, I don’t think I’ll come anywhere close to that and am going to try to make it up with blogging or other opportunities.
Expected/Unexpected Reimbursements: $28 reimbursement for a 5k I ran; $224 visa gift card from Century Link/DirecTV, FINALLY.
I immediately called my car insurance and paid the rest of the balance with that card. I still have about $40 left on it, so I’m trying to decide what to do with that.
Where My Payments Went
Bar Exam Loan: $0.00!!!!! I’m just leaving this here because it makes me really happy haha
Law School Refinanced Loan: $932.05
Extra Blogging Expenses: Some props/items for sponsored posts, but I don’t have the receipts handy. $6.77 for a Facebook ad.
Discover Card at 0% Interest: $282.25
Car Repair: $198.00 Ouch. This included the diagnostic fee and oil change. Luckily, J is a car genius and is saving me like $600 by helping me fix the results of the diagnostic on our own.
Total Payments: ~$1,965.07
We went on our annual camping trip to central Washington this Memorial Day, so some extra funds went to that instead of debt. Totally worth it. I’m adding a savings section to this post based on your feedback, and in hopes that it will motivate me to save when it’s not nearly as fun as paying off debt or shopping.
You guys. Contributing to my 401k is killing me. It’s so hard to save instead of watching debt balances plummet! It doesn’t feel like the same kind of game as debt repayment. Also, I made a mistake when I sent mine up and accidentally set it to increase contributions super quickly after I started. I readjusted my contributions last month, but I’m still waiting for it to be reflected on my paycheck. In case you’re wondering, going from not contributing to a 401k, to contributing $340 a paycheck to your 401k, is REALLY noticeable in your budget. Last last year, I put some things on a 0% interest credit card to redo my house and for some spring/summer travel. I could have paid it all off immediately, but instead made smaller payments and focused my attention on my 7.75% interest bar exam loan. This was absolutely the right financial choice because as soon as I paid that off, I could easily pay off the credit card in under two months, before the 0% promo went away.
I couldn’t figure out why this wasn’t working as I had planned, until last week when I was checking my account balances and saw that I have as much in my 401k now as I owe on that card. I would have absolutely had a $0.00 balance right now with my snowball payments, if my payments weren’t mostly going into my 401k now. As it turns out, money doesn’t fall from the sky just because I started being more responsible about my retirement. /sarcasm.
I am probably being a little hard on myself because I do have pensions and an IRA that either I or my employer contribute to. So it’s not that I’ve been a total dunce about retirement. I just got super inspired and decided to start contributing to my 401k as well, without actually doing the math on what I could afford while still meeting other goals. Retirement is a priority, but paying off this dang credit card, that I “responsibly” charged on, is a huge priority right now and I’m annoyed with myself that I screwed that up. The only bonus is that this is a short term annoyance, while future-Brittany will be super happy about all of the compound interest that I earned from this “mistake.”
Also, in case you were curious, things like this are why I don’t suggest people who have had credit card issues, get cards just because of the points or cash back they’ll earn. That “pay off the balance every month” thing can work, but it takes a lot of diligence and planning. It is easy to be thrown off track.
Anyway, enough woe-is-me over my own actions. The point of these posts is to inspire those suffering through debt while also holding me accountable. I’m accountable. Let’s move on and fix things going forward.
Current Law School Student Loans Balances
Look at that principal payment, baby!!! WAHOO!!!! For the first time ever, I made a principal payment on my subsidized/unsubsidized federal student loans. It feels GOOD! I couldn’t have done it without refinancing. My monthly payment went up by $100 (I was on income based repayment before), but the impact it’s going to make in reducing my debt is astounding. Paying off six figures of student loan debt feels like a bottomless pit. But seeing the numbers in a graph and chart form helps to see that there really is progress.
I’m interested to watch the interest per day go down as I start to pay off principal so I’ll keep track of that here as well.
Before Refi Per-Day Interest: $20.34
Last Month’s Per-Day Interest: $16.19 (This included days where the .25% autopay discount hadn’t kicked in yet)
Current Per-Day Interest: $15.62 (Savings of $146.12 this month in interest alone compared to pre-refi)
I refinanced with Darien Rowayton Bank. I wrote all about it in the Complete Guide to What it was Like to Refinance My Student Loans. The interest reflects the overpayment made on my federal loans. DRB is rebranding their student loan branch into “Laurel Road.” So if you hear me talking about Laurel Road in the future, that’s why. Perhaps they heard my point that DRB is a really unfortunate acronym for a bank.
The reason the balance is higher than April is the payoff amount I received from my lender did not account for the monthly payment I would make, and the refinance happened a few days after my monthly payment of $841 was due. So it over paid by $901. I’m still waiting for that to be credited. It will all immediately reduce the principal, so once it’s sent back to DRB, the numbers will look normal again compared to April, before I refinanced.
To create this chart, you can see in red that I combined the total of my bar exam, subsidized and unsubsidized loans, so that the progress can still be tracked over time and it doesn’t look like I’m starting over. In my opinion, keeping momentum in debt repayment (and being kind to yourself if you get off track) is key to long term success.
Financial Goals Now:
There are still things to accomplish, and goals to achieve that I’ll discuss below. But we definitely need to take the time to celebrate the wins we achieve throughout the payoff process. If we don’t, we will burn out or get discouraged. I’m speaking from experience here.
My Debt Repayment Goals
1) Pay off my car. 3) Pay off the Bar Exam Student Loan. I stuck with the snowball method, to pay off the bar exam loan, and it totally worked! 4) Re-evaluate my savings and retirement plan. As I discussed above, I started also contributing to my 401k, which has really thrown a (good, but confusing) wrench into my budget. 5) Tackle the accrued interest from my income based repayment plan. CHANGE OF PLANS! Refinance my Student Loans. Now that I don’t have two loans to track and send snowball payments to, I’m adjusting my goals to be in increments. It’s very strange to no longer have a snowball loan to attack!
6) Reduce Student Loan Balance by $10,000 to $104,500. I’m coming for you, law school student loans!
7) Reduce Student Loan Balance to less than $100,000. When I hit that $99,999.99 mark, I think we should celebrate!
There are some new links this month. Here are answers or insight into a few common questions that have come up during this process:
- September 2016: Progress Report #1
- What is the Snowball Method?
- How I Paid Off $11,000 in Credit Card Debt + my car at the same time
- Do you hate your career? I did for a long time too. Here are 4 Changes I Made to No Longer Hate Being a Lawyer
- A Review of the Hosting Service I Use for Blogging – which allows me to earn extra money by blogging
- This article at Clear Point gives fantastic advice about how to tell your loan servicer how to process your payments. I would highly recommend reading the post and the comments if you’re dealing with student loans.
- The Real Life Tracking Sheet I use to track my financial, health and self development goals.
- The Complete Guide to Refinancing Federal Student Loans – My experience from start to finish applying with DRB, SoFi and Earnest to refinance my student loans.