I am trying to find a good way out of my debt as quickly as possible, but I am struggling to see any light at the end of this long, long tunnel... It's hard to stay optimistic. Does anyone have any ideas, or could tell me if I'm doing the right or wrong thing? Experts or experienced people only please, I've done a lot of my own calculation.
So I graduated college with a degree in Mechanical Engineering. I have about $65,000 in debt, about $10,000 in savings, and about $10,650 in investments from gifts over the years, and I net about $1230 each month after taxes and retirement ($120 goes to retirement, Roth IRA). Annualized salary=$52,145 before taxes. Rent and typical bills run be about $550+250, and minimum loan payments are about $675. The rest goes to food and gas and girlfriend activities and Mint tells me my net worth is -$44,500 some.
My loans are as such:
$15,565 at 148/mo (7.49%) fix
$15,384 at 178/mo (6.15%) fix
$18,092 at 180/mo (3.29%) var
$16.230 at 172/mo (4.55%) var
My plan was to consider my current investments as my emergency fund; build my retirement @ 6% (minimum for max employer conribution); pay the minimum on my loans; and TRY to build my savings as much as possible. At the time when I can keep 5K in the bank, pay chunks of $1000 off starting with my highest interest loans. When I finally break over net worth to positive, pay off the last of my loans in a larger chunks.
I plan this way because I can't be 100% sure I will always have this job; my car is old and may need spontaneous repairs or simply die, and I plan on proposing sometime in the future, and want to set that money aside (5-6K).
However with retirement just starting and the last loans kicked in, at this rate, it suddenly got very hard to put money in the bank. It is a huge weight. I'm probably going to shut off my TV service and keep that extra $55 or so. But does anyone else have a suggestion? Is my "plan" the right idea or wrong? I may try to consolidate sometime in the future as well if I can find a fixed low rate.
Ah... I hate this feeling