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  • Marnie

strategic decision making: how I paid off $120k in student loan debt

Updated: Feb 26


Learn how key strategic decisions can help you accelerate paying off debt to achieve more financial freedom. This post reflects on high impact decisions to improve financial health and reduce debt.

Woman wearing a black outfit leans against a white wall.

For 11 years I paid the minimum monthly payment on my student loans. At graduation, I had more than $120k in student loan debt. In the first 11 years, I slowly paid down a significant portion of the loans, but I still had about 40% of the total remaining. Co-signed on one of the remaining loans, my parents paid off $12k to improve their credit.

It was 2019 and I was living in Brooklyn, NY. I loved my NYC life and my job, but I still felt trapped by the debt. I couldn’t afford to travel or save an emergency fund. The idea of owning a home felt impossible. So one day, I created a basic spreadsheet to project how long it would take if I saved as much as I could each month to pay off my loans.

4+ years.

The BEST case scenario was another 4 years and 8 months to be exact. My heart sank. I knew I wanted more space, more flexibility to travel.

In that moment, I felt tired of putting other parts of my life on hold. I had worked so hard to create my life in NYC, but over the 6+ years my priorities had changed. I was burnout from a very intense job, and wanted to secure my own future, on my terms - with a home, investments, and the freedom to travel.

I decided it was time to make some hard decisions to pay off my student loan debt.

5 decisions to pay off my student loans

Decision 1: I relocated to an area with a low(er) cost of living

I couldn’t deny the cost of living in NYC was inhibiting my ability to pay off my debt, and ultimately achieve long-term goals of owning a home and traveling more. In 2019, I re-signed my lease for one more year. I thought I would spend 2020 enjoying NYC, traveling abroad, and job searching in preparation of a move. As we know, 2020 unfolded a bit differently… But in December 2019, I applied to one job with the federal government and against all (covid) odds I was hired.

By the end of 2020, I moved to Virginia where the taxes, cost of living, and housing felt ridiculously more affordable than Brooklyn (everything is relative). This was by far the hardest and most financially impactful decision I made.

Decision 2: I stopped buying low quality items and unnecessary items.

I call this the sweater strategy because it was a moment of awakening in how I spent my money. One winter, I purchased a sweater for $60. It was a beautiful sweater - soft and cozy. All the makings of a great winter purchase. Fast forward to the first wash. The sweater literally fell apart - it actually had holes in it from one wash! I didn’t even DRY IT.

So that was my $60 lesson I would learn forever.

From that moment, I decided I would only buy investment or quality pieces. I purchased less things. Impulse purchases were very rare as I usually needed to do research and read reviews before making purchases.

I became that person.

Now I have less stuff, and rarely buy clothes or unnecessary items. It was a pivotal moment in my overall spending habits.

Woman in black outfit is sitting working at a computer with coffee.

Decision 3: I prioritized my earning power.

My career has largely been mission or purpose driven. Early in my career I prioritized experience over salary as it was a great way to learn, build skills, and advance in my field. I’m glad I invested in building my experience, but at some point I had to prioritize making money.

Most importantly, I knew I was not optimizing my earning power. I knew my skill set and experience was highly marketable and could yield significantly higher earnings if I pursued different opportunities. I intentionally made the decision to pursue and negotiate higher salaries in different sectors. While the work may not always be mission driven, it is fulfilling other important goals in my life.

Decision 4: I made large lump sum payments.

I was intentional in how I paid off my student loans. I opted to make lump sum payments as a psychological motivator.

I did this for two reasons:

1) Winning fuels winning. If I saw I was $6,000 away from reaching my goal, it make it easier to say 'no' to unnecessary spending. It was also satisfying to see the total drop significantly at each payment.

2) Bigger savings provided cash flow flexibility. Since I couldn’t afford a separate emergency savings, I still needed to have access to cash in case of an emergency. These lump sum payments served a dual purpose: reducing my debt and building an emergency fund. By maintaining a small surplus equivalent to a month's expenses, I ensured financial stability in case of unexpected events while I paid off my debt.

Decision 5: I shared my saving and debt goals with friends and family.

Over the course of 3 years, I communicated my financial goals with my close friends, family, and my partner. This was essential because it not only held me accountable, but it made it easier to decline unnecessary expenditures like eating out.

In May 2022, I made my final loan payment. It was nearly two years faster than my initial estimated timeframe. This then enabled me to start saving and investing significantly in myself to build my personal wealth more quickly.

3 actions you can do today

Do a financial forecast and measure it against your personal goals.

I knew generally how long it would take to pay off my loans, but it was only once I did a real forecast with my actual salary and budget that I learned to understand the reality. For me, it was a rude - but much needed - awakening to regain my financial freedom.

It can be a super simple calculation. Once you have different scenarios, you can dive deeper into specific financial changes.

Cropped photo shows woman's hands working on a computer.

Share your financial goals with close friends, family, and partner.

My friend Laura has been instrumental in encouraging my progress to my financial goals. Whenever I made big decisions like choosing an apartment or making a move, she was there to help me balance my well-being with my goals. Sometimes it is easy to overcorrect and be extreme when it comes to following the numbers. She helped me think through how to maximize savings while still living and enjoying life.

Sharing my goals made it easier to make decisions, say no to things, and it's way more fun to celebrate financial wins with others.

Adjust the variables within your control.

While everyone's life may not be flexible in the same ways, there is always at least one area that is within your control. Decisions are where we can exercise our greatest influence and have the most impact. There are variables you can adjust - whether it's changing location, job, spending habits, learning new skills for a promotion, or pursuing additional income - there is always something with your control.

Start there. Then build and keep building.

You got this.

Disclaimer: I am not a financial advisor. The following information and strategies outlined to pay off my student loan debt was based on my personal situation. I encourage you to do your own research, assess your personal situation, and work with a licensed financial advisor.



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