So I’m in a lot of debt.

Like it’s one of those numbers that keep you up at night. Like I could have bought a small condo for this debt but instead, I have my degree. Luckily I have a good job with good benefits and all of that lovely stuff. I qualify for PSLF and hope it sticks around. If not I have plan B. But here’s the quick and dirty version of plan A.

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Debt sucks, so you have to attack it.

Debt Plan A

Step 1. Save teeny emergency fund

I didn’t make this a priority before, I have a “secure” job. hahahahaha but it’s in place now.

Step 2. Baby step the debt

So I’m doing my own baby steps. Due to a tax credit, I’m receiving, I’m going to knock out a private loan first. The loan is 2300. Then I’m attacking my credit cards + overdraft line of credit, followed by my remaining private loan, followed by my car. And due to events earlier this year, I’ve taken a break from paying my public student loans. I’m still debating if I’ll save enough to prevent the interest capitalization before I begin repayment again or not. The goal is to knock out at least half of my credit card debt before my student loan repayment begins again.

Now stopping student loan debt repayment to finish credit cards seems nuts. *Insert standard advice here* but last year I paid over 8k towards those damn things and just about all of the 8k went to interest. The worse part, I made too much to get the student loan interest deduction. Paying off half of my credit card debt will free more money for my debt avalanche debt snowball next year and with a pay raise, I’ll be able to move faster 2020.

Step 3. PSLF Pay the Student Loans

This step is up for debate. The number one priority is the debts that have insane interest rates so credit cards first no matter what. If I continue to live where I am now I’ll likely pay off my student loans outside of PSLF. Oh, the student loans are about 100k ish. Money wasn’t my strong suit for a while. It took a lot of learning to finally understand money.

How this helps you

I’ve read so many personal finance books I think I can write one. Budget, cut your budget and sacrifice but above all this I’ve learned that it’s personal. If you are a hardcore follower of a specific plan, you might look at what I’ve outlined above and think I’m crazy but I’ve realized, I need to do what works within my life and so should you. You can pick and choose your debt paydown plan. If you want to contribute to your retirement while paying off debt do it! If you need to spend more on an apartment to be close to work, do it! Do whatever will work in the long term. My debt isn’t a “beans and rice” will fix it level of debt. Realizing this helped me to put a realistic plan in place to pay it.

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