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3 Jan 2016

How to Crush 100k+ of Student Loans In Less Than 5 Years

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by Lindsey Burgess

In the Spring of 2011, Mitchel Burton was a pretty typical college senior. He was living in downtown Chicago, finishing a degree in computer science, and spent a lot of time on YouTube. (OK, maybe the amount of time he spent on YouTube was not at all typical, but you get the idea.)

One of his favorite YouTubers, Shay Carl, mentioned being on Dave Ramsey’s program—a passing comment—that one could argue, changed Mitchel’s life.

That day he looked up Dave Ramsey, and for the first time thought he should probably find out the total of his student loan debt.

One Hundred, Four Thousand, Seven Hundred Sixty-Six.

Mitchel was stunned. “I actually couldn’t even believe it. I felt sick to my stomach. I called my parents, ‘Do you realize we just signed up for more than $100k in loans?’”

Not one to mess around (except, apparently on YouTube), Mitchel didn’t waste a second. He leveraged his “overwhelming student loan burden” in a conversation with his intern advisor and got a $45k/year job offer.

Baby Steps

Because Mitchel had been living off his loans, his post-college life with a real-job was a distinct downgrade: “I took my college lifestyle and dropped it quite a bit lower.” He moved into the least expensive studio he could find and he set about learning everything there was to learn about loans.

“I realized that I had a six-month grace period before I would be paying interest upon interest. So, for those first six months—there is really no other way to say it—I was frugal to the extreme. I slept on a futon, ate noodles and peanut butter and jelly for days and piled up as much money as humanly possible before end of the deferment period.”

Mitchel continued paying off debt, attacking the smallest loans first. Even if the progress was slow, it was progress, and that kept him motivated. But it wasn’t all small progress. There were a couple big milestones that helped him push through to the finish line:

In October 2015, Mitchel made his final payment—$104,766 in less than five years.

“It actually feels kind of weird,” Mitchel laughs. “I almost feel like I don’t give myself enough credit. Maybe I will go out to dinner one of these nights…”

But he quickly shifts gears to his next goal, “Now on to 3-6 months of living expenses, and a full emergency fund. Then I will feel more comfortable easing up a little bit.”

Deep Thoughts

And what does Mitchel have to say to folks that are overwhelmed and staring down massive amounts of debt? Turns out—a lot—of both wisdom and encouragement:

New Perspective

As Mitchel looks ahead, his life is full of options and free of debt. He’s changed not only the trajectory of his entire life, but his family tree: “Now all these other options are opening up and I’m even more motivated than ever to see what I can do.”

Although he makes a lot more money than he used to, he continues to budget faithfully, every month. “I almost need it more now because it would be so easy to waste money and lose track of my real goals.” He leaves us with his favorite quote that inspired him to start freelancing heavily to boost his income in the final year of his debt free journey: “People that win happen to things, they don’t just let things happen to them.”

And that, folks, is how you get ahead.

Your Next Step

Remember, budgeting is not restrictive. You won’t be spending less, you’ll be spending right. You can do this! Today. Right now. What do you have to lose? Except all that debt and stress. (Ok, so kind of a lot.)

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