A Breakdown of Student Loans

In college, I took out an incredible amount of loans to pay for tuition without really realizing what I was getting into. But that's kind of the trick, right? Anyway, even though I graduated almost six years ago (w-whaaat?!), I've still barely managed to break the surface of my student loan debt.


Like many of us, the bad economy has lead to multiple deferments over the years while we try to scrape by in the present - but the beasts of the past never go away, they only get stronger. Making minimum payments on student loans is a sure-fire way to end up paying an extra 10, 20, maybe up to 50% extra in interest alone. For the average graduate with $40k or more in loans, that much interest could go to buying your first new car!

So how do we escape the cycle of minimum-payments-accruing-interests without driving ourselves out of house and home? I've got a plan, but it starts with a little math.

STEP 1. BREAK DOWN YOUR DEBT

I first put together a spreadsheet of all my outstanding student loans, six in total, including their total amounts, interest rates, and current minimum payments.

My loans are now broken down in an easy-to-read format which can easily be adjusted over time. Notice that my total balance is $16,415.57, quite a daunting number to look at on its own! That's why breaking down the individual loans is so important - it's a visual strategy to make the process less intimidating right from the start. Plus I have reference numbers and mileposts available at my fingertips throughout the journey! 

As you can see, I've ordered my loans by amount from smallest to largest - this is crucial to the next part of my plan, which is...

[Coming soon~!]