Since I only took out Stafford loans while I was in school, I was able to consolidate almost all my student loans into a single balance through a program called the Federal Family Education Loan Program (FFELP).
After I consolidated, I was able to use a website (which I believe was maintained by the federal government) to track my loan balance and otherwise access my account. Although the interface wasn't very slick, there was lots of information at my fingertips.
My favorite feature of this website was that you could see your specific amortization schedule for every single payment plan offered. This made it very easy to see the total amount of interest you'd pay on each plan.
If you're in debt -- especially if you're in significant debt -- frugality will only get you so far. To really make a dent, you have to increase your income.
The option recommended most frequently on personal finance blogs I have read is freelancing or consulting on the side. Another option is a second job (usually hourly work of some kind).
However, side jobs aren't always the most effective way to increase your income. Freelance work is often sporadic and part-time/hourly work doesn't typically pay all that well. Time and mental energy are finite resources. Focusing too much on your side gig(s) may come at the cost of your career or interfere with your balance between time and money.
"Be Responsible. Take responsibility for your actions." It sounds simple, right? But what responsibility means to me has changed over the course of my life.
In fact, there are so many definitions of responsibility that Wikipedia doesn't even have a definition listed on its main responsibility page! There are over fifteen types listed there with links to their respective pages (though to be fair, one is a song).
Since I have approximately $100,000 in student loan debt, I now find myself faced with the task of becoming financially responsible. But what does that mean? What type of responsibility do I face?
My mother was quadriplegic by the time I was in high school. My dad was a real estate agent who worked on commission, so he worked long hours to make ends meet. As a result, I took on a lot of responsibility at a young age.
I cooked and cleaned and did all the grocery shopping. I did the laundry and paid the bills (in the “balancing the checkbook and writing the checks” sense, not the earning money sense). I took my mother to the bathroom, fed her, and tracked her pill regimen. And most importantly, I believed that a college education was a good value.
I knew my parents couldn't afford to send me to college, and I wasn't allowed to have a job because of my responsibilities at home. So in lieu of saving for college, I threw myself into everything school had to offer.
In my last article at Get Rich Slowly, I gave the background on my income and expenses. My husband's income and expenses are a little more difficult to compile. For one, Jake left the life of a steady paycheck about a year ago in order to start his own business. This means that his income fluctuates, which of course we knew going in. It also means that the first few years he's going to make much less than we hope he will eventually. We also knew that going in.
However, another major factor is that Jake's idea of household budgeting is "make so much money it doesn't matter what you spend because you can afford it all." When he started working at The Big Firm right out of law school and was making $90,000 a year, this was something that was more or less possible, especially since he was working 80+ hours a week and didn't accumulate vacation or sick time. He didn't have time for anything really spend-y. However, even though he's now living the entrepreneur's life, he's resistant to budgeting. Earlier this week I sent him J.D.'s article about how to budget for an irregular income, and his response was:
Hello. I'm Honey Smith. I'm thrilled to be a part of the GRS community, though of course a little embarrassed that it's essentially as an object lesson to others of what not to do. However, I do hope that everyone on the site learns something along with me.
For those of you who are financially comfortable (or close to it), those lessons may be about empathy or discovering how a significant percentage of people in their 20s and 30s with lots of formal education are struggling in these days of student loans. For those of you living with student debt, hopefully we learn some ways to get back on track together.
Where I'm Starting From
As I mentioned in my previous post, my husband Jake and I owe a combined total of over $230,000 (about $100,000 apiece in student loans and $30,000 in credit card debt — I gave initial totals there but will provide a debt update in another post).
How much should you spend on a wedding? Well, that depends on who you're asking, I suppose. As I'm sure most of you are aware, the personal finance blogosphere tends to be divided into two main camps: those that are focused on investments and entrepreneurship and those that are focused on frugality.
In my experience, however, the entrepreneurship camp is pretty live-and-let-live. The whole “cut everything you don't care about so you can spend whatever you'd like on the things you do care about” school of thought. When you think about it, this makes sense for a few reasons.
- We all have different skill sets to be utilized in our respective side hustles.
- Different skills mean different pricing schemes.
- We all have different work and family situations that we're fitting said side hustles in around.
- We all care about spending our money on different things, and those things cost different amounts and reflect our tastes and values.
Long story short, what this means is that sometimes it's difficult to talk about investment and entrepreneurial issues in a way that applies to everyone.