Part 1: Finding Out We had 180K in Student Loans with a Baby on the Way
Yes, the words are “Finding Out” for a reason. My husband and I were not on the same page with out finances, and he didn’t know how much debt he was in. So instead of the 60K he thought he owned, the number was actually around 160K. It was like waking up in a nightmare. And while you probably have in opinion on that situation, the reality is that we are now on the other side of it and we got through it together. as a family. We found out that I was pregnant in the Spring semester of my junior year of college. And because you’re probably already thinking it, the pregnancy wasn’t planned. But we knew we loved each other and would get through it all together. So that was us. I was 21 years old, pregnant and found out we owed 180K in student loans. At this point I wasn’t even sure if I would graduate with my degree in Materials Science & Engineering (I did.) This was Rock Bottom #1. The next part was finishing up school. We waited to make payments on our loans until we had to (6 months after graduation). My husband graduated and started working as a mechanical engineer in August 2015, we had our daughter in November 2015 (insert 1 NICU stay and a hospital bill here), I “graduated” in December 2015, but I actually graduated and received my degree in May 2016 after finishing my last class online.
Part 2: Paying Off 54K in 14 Months
This is where we buckled down and worked as hard as we could to pay off debt as fast as we could. We began this all in February 2016. Why February? That was when payments were due. We took a personal finance course (Dave Ramsey’s FPU) and it was horrible for our financial situation and only made us feel worse. Don’t get me wrong, there was a lot of valuable information, but a huge portion didn’t apply to us. But it did get us serious about wanting to be debt free.
Part 3: The Tragedy
From February 2016 to November 2016 things were going well. I graduated in May 2016 and began working as a Materials Engineer 2 weeks later. We were living off of less than 25% of our take home pay, and we were truly crushing our debt. Then a week and a half after my 23rd birthday, I received a phone call that my dad had a stroke. He had just turned 51 two weeks prior. He passed away less than a week later and the world I had come to know was upside down. I truthfully barely remember the months between November 2016 and June 2017. We continued to pay down our debt, but I was numb with grief. Then sometime in May, my mother called me and gave me the shock of our life.
Part 4: The Unexpected (and Unwanted) Windfall
The phone call that came from my mother included her wanted to pay off the remainder of our student loan debt. This was unexpected and absolutely a shock to us. In fact, I had literally just made another extra payment towards our loans only hours before. We were grateful that she was able to do so, but the reason I say it was unwanted was that the money had come from my dad’s life insurance. (quick note, my mom has a financial advisor and she was in the financial situation to do this insanely geneorus thing). That meant this money was literally, “blood money.” It was a mixture of emotions ranging from guilt, to relief, to disgust and everything in between. But that is when we became debt free. And it took a couple of months to sink in.
The reason I am sharing this is because inevitably there will be those who want to discredit me and the mission of Hello Personal Finance. Those who will say, “well, wouldn’t it be nice to have my loans be paid off too,” or other things. This is true, the majority of our loans were paid off for us. But 54K in 14 months was certainly not done easily. There is no doubt in my mind that we would’ve kept on going and beaten our timeline had we not received this windfall. I felt the emotions and weight of six figures in student loans and what that meant. I felt the fear and self doubt and feeling like our lives would never begin. I remember calculating that we might be able to buy a house in the next 8-10 years and feeling like a failing parent for that. But the things I learned along the way have shaped our financial life and have given me the tools to help others shape theirs too. And for that reason, I hope that you are able to set up your future for financial success.
Hi, my name is Rachel Smith. I’m 24 years old. My husband Travis and I began this journey with well over six figures in student loans. If you are there too, I get it. And you can get through it! We are now debt free with our 3-6 months emergency fund. As of October 2017, we moved into our first/forever-while-we-live-in-this-state home where we live with our two kids (ages 2 and under 1year, a dog and a cat.
Part 5: From Engineer to Writer
Our daycare, our top rated, extremely expensive, Montessori fancy pants daycare shut down two weeks before I gave birth to our son. In our region, infant daycare is EXTREMELY hard to get into. So when I called and tried to get our soon-to-be-born son into another center, the responses I got began with laughter. They were booked into late 2018-early 2019. So I quit the job I already hated (another story) and began at home. And I turned to what I loved as a job, freelance writing and blogging.