What’s up guys! It’s been four months since our last update. Some exciting things have happened since then. We paid off our car! No more monthly payments to Navy Federal! As of right now, we owe $85,581.62. That’s $10,779.53 paid off since our last update and $36,918.24 paid off since we started. We have nine of our twenty loans paid off, so eleven more to go. Let’s dive into the details about everything that has happened since April.
Some of you may be wondering why we paid our car off. We have been doing the debt snowball, and our car wasn’t next on the list. In fact, there were six other loans ahead of the car payment. Well, one of the good things that have happened in this pandemic, has been the CARES Act. This Act was pushed through back in March. It provided relief for families in numerous ways, but the relief that has been a huge help for us is the suspension of federal student loans.
All of our federal student loans were put on pause with 0% interest until September 30, 2020 (which has now been extended to December 31, 2020). Since we didn’t have any interest accumulating on those loans, we decided to attack a loan that was accumulating interest, our car. We took the minimum payments of those loans ($573.44) and added it to our car payment ($232.70), which gave us a new minimum payment of ($806.14) to go towards our car. Any extra money we made with our side jobs, we threw at the car too. When we decided to attack the car debt, we owed $5,156.47. This was back in May. It only took us two months to see the remaining balance of $0.00 on our loan. We paid the car off two years earlier than we were supposed to. Now we have an extra $232.70 that we can use to throw at other debt each month.
If you have any student loans that have been put on pause during this pandemic, please take advantage of it! No interest is huge. Our Sallie Mae loan grew by $6,000 in 12 months because of interest. Interest is the main reason loans take years to pay off. Without them, we would be a lot further along this journey. For instance, on my loans with American Education Services, $24,739.44 has been paid towards it. When I first started paying it I owed $24,766.01. If there hadn’t been any accumulating interest, we would only owe $26.57. But because of interest, we still owe $5,232.61. Of the $24,739.44, only $19,859.24 went towards the principal. With no interest accumulating right now, all of your payment is going towards the principal. Let me say again,
ALL OF YOUR PAYMENT IS GOING TOWARDS THE PRINCIPAL!
A lot of people see that their loans are on pause, so they use the monthly payment to go shopping or get the latest gadget. Don’t be like that. This isn’t Christmas money. The relief is only for a time period. Even if it gets extended for another year, eventually you will have to make another payment on it. Please take advantage of it. Now if you’re without a job during this season, or are struggling to make ends meet, use this time to get your money in order so you will be prepared when the relief ends. This has been a crazy year, but the government has provided a few alley-opps to help us out along the way. That like never happens. Remember in the words of Dave Ramsey, "Live like no one else, so later you can live and give like no one else." Stay Anomalistic My Friends!
Here's a breakdown of how much we owe as of right now:
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