Last year we posted every penny that we owe in an effort to be 100% transparent about our debt repayment. I wanted to wait until all of the numbers were in from our 2014 transactions before giving you an update on our debt repayment plan (the debt avalanche).

Below you will find the opening balances of all of our credit accounts at the beginning of 2014 and what they were at the beginning of 2015.

Here Is A List Of All Our Debt:

Debt Repayment Results 2014

Student Loans

Sallie Mae 1 (4.125%) – $30,099.89 —> $28,414.24

Sallie Mae 2 (4.25%) – $15,193.11 —> $14,927.70

Sallie Mae 3 (5.25%) – $2339.79 —> $1,867.70

University Loan (5.0%) – $1,458.94 —> $968.53

Total Student Loans – $49,091.73 —> $46,178.17

So we managed to take off nearly $3,000 from our student loans. Because the interest rates on them are so low, they aren’t a priority in our debt repayment plan. The $3,000 reduction has come exclusively from paying the minimum on each of these loans.

We were able to get the interest rates so low because we took advantage of every offer they gave when we first started paying them back – making on-time payments for a certain number of months in a row, and also allowing them to deduct from our bank account each month.

The first Sallie Mae loan belongs to me, and the rest belong to my wife. For the full story behind these numbers, be sure to read about how we got into student loan debt:

[See how Khaleef got into student loan debt, and how Sherrian racked up her student loans!]

Initially, we owed almost $65,000 on these loans, so I’m glad to see them go down.

Credit Cards

Credit Cards Frozen

Credit Card 1 (14.24%) – $2,063.56 —> $0

Credit Card 2 (10.74%) – $2,004.66 —> $0

Credit Card 3 (6.24%) – $2,922.19 —> $2,593.79

Credit Card 4 (14.99%) – $955.74 —> $0

Credit Card 5 (15.24%) – $829.04 —> $952.95

Credit Card 6 (9.24%) – $5,058.10 —> $4,368.04

Credit Card 7 (9.24%) – $5,261.17 —> $4,639.66

Credit Card 8 (18.24%) – $126.22 —> $274.46

Credit Card 9 (0%) – $562.69 —> $244.12

Credit Card 10 (20.24%) – $9,433.54 —> $8,318.15

Credit Card 11 (11.24%) – $6,617.21 —> $6,682.08

Credit Card 12 (0%) – $975 —> $0

Total Credit Card Debt – $36,809.12 —> $28,070.95

We were able to pay off nearly $8,800 in credit card debt in 2014. Since our total debt is more than my annual gross salary (and close to double my net), we are quite pleased by this amount!

As you can see, we were able to completely pay off 4 accounts – really 5, but we had to use card #9 for an emergency that my brother-in-law had near the end of the year (it will be paid off by the time you read this). We actually did a hybrid of the debt avalanche and the debt snowball, since we started the year with so many accounts and the bookkeeping for them became a real time killer.

Cards 5, 8, and 11 were used to carry various expenses on them and then plan was to pay them back as soon as the expense happened – although, I didn’t always keep track of that. This year, we are only using 1 card to make purchases and we will be sure to pay those amounts off at the end of each month.

Twelve Accounts???

Some of these are really old accounts that we had separately before we got married, and some of them came from one night where we applied for a number of cards that all had 0% balance transfer offers (long story). We wrote about how we got into credit card debt, so you can read all the details if you’d like. :-)

Personal Loans

Personal Loan 1 – $4,500; $3,100

Personal Loan 2 – $2,600; $2,600

Total Personal Loans – $7,100; $5,700

This is a huge category for us. We want to pay these family members back and even though we aren’t paying interest, these are a high priority. We actually “paid” the $1,400 by taking on an expense that they weren’t able to handle at the time.

Early on in our marriage we had to borrow money from two family members in order to handle emergencies that came up (which is why we are trying to build an emergency fund now). They never even bring it up to us, but we want to honor all of our debts, so these stay on the list!

We have already paid some of the first one listed, and we plan to pay these off sooner rather than later.

Our Total Debt

Grand Total – $93,000.85 —–> $79,949.12

Old Total – $105,000 8-O

Even though we didn’t pay off $20,000 in debt, we did manage to move from the 90s to the 70s! Owing $13,050 less than we did a year ago is a wonderful feeling. We are going to try even harder this year to pay off more of our debt, especially the high interest loans.

Since we began a sincere effort to become debt free a few years ago, we have paid off $25,000. Just imagine what we could have done with that money if we were debt free! :-?

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College students, no matter what age they are, can feel the stress when it comes time to paying back college loans. College isn’t cheap, no matter where you go, and unless you have a full ride or some good scholarships (or maybe some savvy parents that saved up money for your college fund), you will have to get loans and those loans will need to be paid back.

There are a lot of resources for college students available online, including information on financial aid. You can find assistance prior to attending college, once you are in college and even after college is finished, when it’s time to pay back the lump sum of your loans.

Just remember, you do have to pay that money back, no matter how many times you sign up for deferment or forbearance.

Avoiding or Minimizing Student Loans

Student Loan

Some of the most important things to consider before you head off to college and sign a bunch of loans are how you are going to pay those loans back and how you can alleviate some of the loans you are in need of. Loans are stressful, and the less you need to borrow the less you need to pay back.

Apply for as many scholarships as you qualify for. These will help you pay for college with money you don’t need to pay back. Some employers offer tuition reimbursement if your degree is something that will help you be more of an asset to them. Look into this, talk with your manager.

You can also apply for grants, which are another great resource for college students. Grants are available for many and they don’t need to be repaid.

If you to school part-time and work while you attend you can make regular payments to the loans you do need to get and you might have school paid off by the time you finish. You could also opt for a work study program.

How To Handle Student Loans Responsibly

One mistake that many college students with loans make, which adds more stress to their lives, is spending the stipend they get through their loan provider. That just racks up your owed money more and you risk the possibility of exceeding your loan limits. No more loans means no more college if you don’t have money put away to pay for your courses, books and other fees.

If you have no other option than getting a loan, you can also get subsidized loans. The Federal Government pays the interest on this type of loan, which lets you spend just a little less money.

When you get a stipend, use it to pay back that portion of your loans. It might not go a long way, but it helps keep your interest covered and will save you some stress in the long run.

Ignoring your loans is not an option, since that is money you used and the government expects you to pay back. It can ruin your life. Unpaid loans lead to bad credit, which can mean you can’t get a car or a home. And those aren’t even the worst things that can happen. Imagine being on the run because of your unpaid college loans!

Use all of these resources for college students to make sure you get all the information you can before you start college, or sign any papers, and you just might save yourself a huge headache. Talk to your college adviser and college loan officers. Find out your options. Don’t fall into the college money pit.

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