Paying off your debt is like giving yourself a raise. At least that is what I felt when I paid off mine. It wasn’t that I had more money that was coming in, it was that I had more money staying in and I could do more with it like save it and invest it. However, like most Americans, I didn’t always desire to pay them off. I went to a private institution (a Historically Black College at that) and those fees can be through the roof. So when it was time for me to graduate, I had accumulated well over $70,000 in student loan debt. 

At the time, it wasn’t that big of a shocker but overtime, I grew in my career and felt prepared enough to buy my first home. This is where the loans came back to haunt me. There’s this thing called debt-to-income ratio (DTI) (link IG post) and it has a big deal with what you qualify for from a mortgage amount & interest rate perspective.

So though I had just landed a high-paying job, my DTI was above 36% (the max that lenders prefer) so it impacted the purchase price that I was approved for. This then limited the amount of homes that my realtor and I could shop around for. 

I never found my home during that search because none of my offers were competitively priced enough for the area. It didn’t matter that my income was more than my student loan balance at the time. I needed to do more. I needed to tackle the debt. I asked my lender how much I needed to pay off and he calculated a number. That wasn’t enough for me though. I never wanted to be in this situation again of being “ghosted” by sellers. So I told him and my realtor that I was going to pay my student loans off in full. And I did in less than 2 years!

Keep reading for 3 Strategies I used to pay off my student loan debt:

When I made the decision to face these demons (my loans haha), I knew that I wouldn’t be able to do it living in my high-rise apartment. Rent was a beast but because I was only paying the minimum (i.e. interest) on my loans, it was doable. I decided that I needed to remove rent from the line item in my budget so I left my independent living to move back in with my mom. Insert all the tears here because I had them. I had been living on my own for 7 or so years at the point so the idea of moving back home and having to “answer” to my mom (black kids know what I mean here) just reverted me back to childhood. To be clear, I love my mom and would do anything for her but I was grown grown! 

Let’s just say, the experience humbled me. Though she had raised me (well), we had to go through a new set of growing pains as there were now 2 adults in the house who had continued to evolve over time. So we did everything you could imagine a mother and daughter would do: argue a lot haha. Eventually, after like 3 months, we found our groove and actually started spending time together peacefully. 

Now I realize that I am privileged because I don’t have kids and my mom welcomed me back home with open arms. I think if either of the above was my scenario though, I would still pursue changes if paying off the loans were important. If you have children, you can re-adjust your budget, ask to work remotely (if your job allows it) so that you can reduce babysitting fees, rent out a portion of your home, bring on a roommate or even take up a second job. These are just ideas that i’ve seen others do but I recommend you find a lifestyle change that works for you. Also, stick to a timeline that is realistic. Don’t let anyone rush your process.

2. I Tackled high-interest rate debt first

3. Create a fun money account

Now this is a tip I learned from The Budgetnista. Fun and paying off debt were not synonymous for me. I didn’t have a life at the beginning. I went to the gym, went to work, worked on my side consulting gigs and then went to sleep. Rinse and repeat. But my mom was actually the one who called me out. She didn’t feel like I was maximizing my time at home with her and our family. We like getaways, wine tasting, festivals etc. and those cost money. 

So when Tiffany the Budgetnista mentioned that she had a “fun money” bank account, I knew I needed to create one. This is money that I would manually transfer to another account from every check. It was the same amount from my consulting invoices and my direct deposits from work. It was around $300 per month. So whenever I was out eating, wine tasting, or looking to getaway, I used that account only. Once the money was gone, I was out of fun. 

It actually worked perfect and it’s something I still use today, even with me being out of my mom’s home and into my own. I highly recommend it but be sure to set up alerts so you don’t overdraft. 

The bottom line:

Paying off debt requires you to be strategic. Find the strategies that work for you and keep implementing.

I also redirected all of my dividends from Fundrise into this new account. They came quarterly and sometimes I forgot they were coming. I highly recommend investing in REITs via Fundrise. Not only is it a great introduction to real estate, but it also is a great source of passive income. Learn more about my experience in this ebook.

What are some of your tried and true tricks or what have you heard that works? Comment below.