A monthly budget is a powerful tool for paying off your student loans.
As Dave Ramsey says, a budget is how you make your money behave! He also says that using a budget will make you feel like you got a raise. It’s true.
Erasing $20,000 in Debt in 2 Years – In New York City!
Here is a quote from a great story about getting serious, and using a budget, to get rid of your student loans.
“Just months after getting our diplomas framed, Joanna and I sat down and got serious about our finances and attacking our $20,000+ in student loan debt. While interest rates were favorable and our cumulative debt was lower than many graduates, we couldn’t stand the feeling of owing anything to anyone. Imagine our conundrum when I got my dream job offer from a storied advertising agency in New York — the most expensive city in America.
Despite a cost of living that’s 125 percent higher than the U.S. average, we were committed to paying off our debt in two years. And the craziest part of it all? We did it. (We were in Manhattan for a year and a half, and then we moved to Boston for a year.)”
Here’s another quote about how they attacked the debt.
“Instead of first budgeting out typical expense categories (food, transportation, tourist activities, etc.), we figured out how much we wanted to put toward paying down our debt each month. After subtracting that from our monthly income, we knew how much money we had remaining for all of our discretionary and leisure spending.
We created an itemized budget and then tracked our expenses like accountants from the Internal Revenue Service. Every penny of every expense was accounted for throughout each month. If we noticed that our $350 food budget was running low halfway through the month, we knew to cut back or face the wrath of beans, rice and ramen for the duration. This tracking helped ensure that our get-out-of-debt goals were walking the walk.”
Here’s the full article about how they did it. Check it out. It’s a fun and motivating story.
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