When we last heard from Bridget Casey, her student loan debt stood at $14,500. Here’s how she shed $5,000+ in the 2 months since that update.
I had a nasty bout of debt fatigue at the end of last month that led me to take drastic measures to reduce my student loans.
Exhausted by my own $1,000/month repayment plan, I decided to cash out a mutual fund to pay off one of my loans a full—5 months ahead of schedule.
HOW I SAVED OVER $6,000 IN 4 YEARS
That index mutual fund was one of the first investments I ever made. I began putting money in it right before I began my third year of university, and I regularlycontributed $100 to $200 every month thereafter until a few weeks ago.
These regulardeposits were compounded by the recovery of the stock market over the past few years,and my initial $1,000 investment gradually ballooned to over $6,000.
It’s amazing howmuch I accumulated with essentially painless withdrawals from my checking account. Inever missed the $100 that I put in each month, but I sure was grateful to take out the$6,000 sum at the end.
REAPING THE REWARDS OF DEBT FREEDOM… AT THE MALL
Eliminating my federal student loan balance also eliminated the payments of$900 each month that I had committed toward it. Suddenly I had a huge amount ofdisposable income available.
However, I knew that continuing on arampant spending spree would just result in more debt later, so I got back on track andmade a plan for what to do next.
WHERE MY MONEY (AND DEBT) IS HEADED NOW
First, I increased my payments to my provincial student loan. I want to be debt free, and to do that I need to shed the $8,900 I still owe for my undergraduate degree.
Second, I started a new travel fund and began putting money away for my next adventure abroad. I know myself well enough to recognize that a vacation at least once per year is essential to my happiness.
Lastly, I doubled my contribution to my brokerage account. If this experience has taught me anything, it’s that money gives you options. If I hadn’t been proactive and begun saving and investing years ago, I’d still be grappling with an extra $5,000 of student debt.
With more than half of my student loans paid off only a year after they entered repayment, I’m looking forward to being debt free way ahead of schedule. Maybe I’ll even get two vacations next year!
Bridget sacrificed future earnings for happiness now. Would you do the same thing? Let us know in the comments.