How I Paid Off My Student Loan in Less Than 5 Months (After Letting It Languish For 9 Years)

I borrowed about $19,000 back in 1997 in order to finish graduate school. (That was stupid and completely unnecessary on my part, but that’s another story.)

This is the story of how I paid off the balance of my student loan in less than five months.

After borrowing the money in 1997, I paid sporadically on the loan when it entered repayment. There were months when I paid nothing but interest due to the loan being in forbearance, etc. There were also months when I paid $200 per month, which was my agreed-upon larger-than-minimum monthly payment.

Then end result was that by June of 2006 (9 years after taking out the loan) I still owed $9,759.46.

By October 17, 2006 — less than 5 months later — I owed zero.

How did I do it?

It wasn’t by getting a fancy job with a big salary. (I brought home about $2100 each month.)

It was by focusing solely on that debt. For a little more than 4 months, I woke up every single day thinking about how I could pay off the debt as quickly as possible.

Could I make extra money somehow? Could I get started with some passive income ideas? And what about expenses? Could I cut them? Start tracking them so I’d know what my expenses even were to begin with? Could I send in multiple payments each month to the loan in order to pay less interest? Could I get a discount on the stuff I absolutely did have to buy?

The answer to all of those questions was yes. I was consumed by paying off that debt. And it worked. The more I sent in, the more I wanted to send in, and the more fired up I got.

By the end of September 2006 I had paid off $5359.28 of the debt, leaving a balance of $4400.18.

Finally, the obvious hit me during a conversation with my husband. I was telling him that I didn’t understand why people who had the money to pay off a debt didn’t do it, when it dawned on me that that described ME. I had some money in the bank that I had been saving up for emergencies.

It hadn’t occurred to me to use that money to pay off the balance of my debt until that moment, because the money in the bank made me feel secure. But that feeling of security was really just an illusion, and I was paying more on my debt each month in interest than I was earning on the money in savings.

So I withdrew the balance of what was needed to get my debt paid off and sent it in. That’s when my life changed — the moment I felt what it was like to no longer having a debt like that hanging over my head — to be free of worry and stress related to it, and to have money to do whatever I wanted to with each month.

Do you have a debt related story to share? I’d love to hear it.


  • Paying off debt creates its own momentum.

    Once you see the progress and know that there’s light at the end of the tunnel, it motivates you to get to the end quicker.

    The exact same thing happened with me

  • David, that’s what happens for sure.

  • Tyler

    This is very funny to me, because the same thing happened to me just last week. Our stories and worries of these loans are identical, to an extent. I graduated college in ’08 with $20,000 in debt with interest adding on top way too quickly. I’ve been making larger than necessary payments on my loans since I graduated. Then in March 2010 I looked at the balance of my one loan, of which started out with a principal balance of $9,600. There was $3,600 left. Originally, my goal was to get it paid off in about 16 months, from this time. Then while I was taking a shower later that day, it hit me! Why don’t I just take that amount from emergency savings and pay off that loan? Then I can just add money back to that emergency fund much more quickly since I’m paying off one less loan. So, I did it! I paid off a loan where the lender was giving me 12 years to pay it off and paid it off in less than 2 years, instead. The feeling of not having that loan hanging over my head is so liberating. See, I’d like to get married and get a house sometime in the near future. So, I’m trying to drag as little debt into my marriage as possible. Unfortunately, right now I have an additional $11,400 in student loans from another lender. Not to mention, the car that I’m paying off right now, too… But now I know that with determination, these loans can be paid off much sooner. And to me, getting that one loan paid off was quite an accomplishment. Plus, I’ve now learned that loans and financing items (such as cars) should be a very last resort. I admit I could have worked more in college instead of borrowing $. I also know now to get a cheaper car to avoid all these monthly payments and to free up some money where I can just pay straight cash for a nicer car the next time around. I’d say I definitely learn the hard way.

    • Tyler, that’s funny that things are so similar. Although it sounds like you figured things out a lot faster than I did, so that’s great. Getting that first loan paid off is a big accomplishment, but even better is that you’ve now changed how you approach your finances in the first place.

  • Dick F.

    This doesn’t prove anything. You have your husband to support you, so basically you have money laying around each month to pay off the student loan debt. It would have been impressive if you did it all by yourself with no spousal support.

    • Actually we have separate finances, so unless you count each of us paying half of our mortgage my husband and I don’t support each other financially.