Everyone is talking about getting out of debt. People who are dedicated to getting out of debt so they can "owe no man nothing" have a good mindset. But what about people who can't find a job in their field, and have to work temporarily in a factory? They aren't making the big bucks their degree promised them. How can they work to get out of debt? This is a possibility for everyone-you are not guaranteed a job upon graduation, so what's your plan? Let me share what our plan was, and how it worked, not once he got a job, but by Graduation day!
Our plan:
We were married at the end of my Husband's third year of college at a five year school. While planning out our whole life (as most young, inexperienced couples do), we already determined that I would work while my husband focused primarily on being a full time student. I had no degree, which meant our income would be very low, probably just enough for us to live on. We really wouldn't have much extra cash to pay for semesters of school, so it was going to be on loans. This made us very aware of every penny we had, and every penny we were spending. We were dedicated. And that's what you have to be to get out of debt. We didn't want to have to be paying off loans until we were 40. So here's what we did:1. Set a Budget
It's very easy to get a paycheck use it to pay all your bills, go to the grocery store and spend however much you want, and use rest of it to go shopping or hang out with friends. What's difficult is limiting yourself and gaining self control. Creating a budget can be intimidating, but it really is easy once you sit down and work through it. One thing that we learned is to start with the things you know for sure. Know the exact amount of your cell phone bill each month? Then that's your budget. Know how much your car insurance is each month? Etc. And for the things that are unknown, start with a low number and try to stick to it. If you absolutely can't, you know you've set an unrealistic goal and can change it. And, each month you'll get better at budgeting! Once you get into a groove and really get the hang of things, you can continue to challenge yourself with budgeting less and less. Even today we eat on only $180/month-- and we eat organic!
During most of the summers my hub found work or did internships. As an engineer, he always got paid for his interns, and we never needed much to live on, so we put it in a special account and didn't think about it. If he did part time work on someone's ranch for a few months, we set that aside too. Each month we tried to look at that special account and apply most, if not all of it to loans. Some times we would go months without having anything extra to put in that separate account, and that's okay. If you leave the extra money in your regular checking account, you'll probably get used to seeing the money. If you put aside money in an account you don't use or check as often, it will be much easier not to miss it when you put it towards your debts!
Look, shopping really adds up. If you've lived your whole life without this cool thing you found at the store, don't you think you can wait until after you reach your out-of-debt goal? The greatest thing I learned how to do is shop with gift cards. If I really wanted to do some shopping, I'd wait until a holiday or birthday and use my gift card on what I'd been eyeing for months. You need to learn how to see cute or cool things at the store and leave without them. This might mean staying clear of your favorite store to avoid temptation!
Depending on your situation, you may not be able to afford to do this. However, if you've completed step #1 you may know what your monthly expenditures are and can use the rest of the money towards your loans! If my husband or I got a lot of birthday money, some of it would always go to loans. And same thing with Christmas money. When we got money we weren't expecting, as long as we weren't in a bind, we wouldn't keep it. We'd give it right to the people who we owed 10's of thousands of dollars. When he got extra money from scholarships, we never kept it. It would have been nice for our savings account, but we knew that money was meant for school.
One of the great things about my husband is that he is not afraid to work. Even though he was focused on doing well in school and graduating on time, he worked to make extra money when he could. He was constantly asking his friends, classmates, professors and even people he just met, if they had work. He would make a couple extra bucks this way that really helped us get by when my work wasn't cutting it. But after I got a better paying, full time job, we put his extra income in the separate savings account, and put it directly towards school. We were always rummaging through our things looking for things we could sell for extra cash. Even selling his old notes and textbooks really came in handy. There are plenty of ways you can make extra cash without a lot of work involved. Especially in a college town!
My husband got his degree at a five year school in Engineering Management. It took plenty of hard work and dedication but we are officially out of debt! There were a lot of times I passed up on the opportunity to buy something I "loved" and was "heartbroken" but now I can't even remember them! If you really, really, really want to get out of debt, you can learn to take your budgeting and saving skills to the next level! Just think what a 'loan' off your shoulders it will be in the long run!
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