This past week I paid off my private student loans, and let me tell you, I was surprised when there was no congratulations confetti from the bank that I had done it. Well, in life you often have to create your own confetti.
I walked at graduation exactly 3 years ago last Saturday and I had been working to pay off my private loans since. My private student loans totaled a little over $40K when I graduated, and 2 years ago when I refinanced they totaled a little over $32K so progress has definitely been made.
When I made my final payment on Monday, it was a little over $2,500 so you may ask, why did I decide to do this now after recently being laid-off, purchasing a home, and as I’m launching my career coaching business in the middle of a pandemic?
A few factors, but as I looked ahead, the main bill that I was concerned about was my private student loans so as I reflected, I thought about whether or not it made sense to dip into savings to pay the loan off. I decided yes, that it did make sense. Interest wasn’t going to work in my favor so why not get it over with.
The other piece was more of an emotional factor. When it comes down to it, the best financial decision actually would have been to put that money towards my car loan. But I like many have been feeling a bit down and maybe a bit lost in this crazy season that we are in. I found myself really looking for a win. I felt like I was so close to this finish line on something that I would have been able to do last month if everything had gone according to plan so for $2,500 I got myself a win.
This win has uplifted me in many ways because it’s allowed me to refocus on my financial goals and my life goals holistically.
This leads me to my next point, my monthly private loan payment was $376 so with that bill out of the way, I’ve adjusted my car payment by adding that $376. I’m really moving around the money that would be going towards my private student loans and putting it towards my car loan since that has a higher interest rate than my federal student loans. My next goal is to pay off my car loan this year and then I will focus on my federal student loans. I’m still definitely on my journey in paying off my student loans, and it feels good to cross the finish line on my private student loans.