This will be my first student loan summary for the new year, and I’m hoping that this year will be a positive year with lots of progress being made towards my student loans. I’ve already stated my goals towards my loans this year and I really want to be able to meet my stretch goal. It will take a lot of dedication to make sure that I keep my spending on track so that I am able to meet my payment goals. I’ll also be looking forward to remembering that each payment I make that reduces the principal leads to a little less interest being paid the following month.Let’s take a look at my payments for January:
| Loan | Loan Amount | Change | Interest Rate |
| Private 1 | $ 14,208.19 | $ (1,659.00) | 7.92% |
| Private 2 | $ 19,515.23 | $ (76.22) | 7.92% |
| Private 3 | $ – | $ – | 7.92% |
| Private 4 | $ – | $ – | 7.35% |
| Gov 1 | $ 3,598.02 | $ (32.04) | 3.40% |
| Gov 2 | $ 3,144.74 | $ (22.47) | 6.80% |
| Gov 3 | $ 4,983.51 | $ (39.14) | 4.50% |
| Gov 4 | $ 1,887.41 | $ (13.78) | 6.80% |
| Gov 5 | $ 5,030.36 | $ (36.87) | 5.60% |
| Gov 6 | $ 1,999.18 | $ (14.60) | 6.80% |
| Gov 7 | $ 4,113.98 | $ (29.63) | 6.00% |
| Gov 8 | $ 3,149.26 | $ (22.53) | 6.80% |
| Total | $ 61,629.88 | $ (1,946.28) |
As you can see from the above, I was able to continue my $2,000+ pace of paying off my loans. I put a total of a little under $2,300 towards my loan this month and over $1,900 of that ended up going towards the principal. Not bad at all, and hopefully that will start to push $2,000 towards the principal as it gets later in the year.
30 days of interest on my current balance for Private Loan 1 of $14,208 @ 7.92% ends up being around $92. If I drop that amount by around $1,650 taking into account next months payment the new balance will be $12,558 @ 7.92% and 30 days of interest ends up being around $81. That is an $11 reduction in interest paid in just one month! From there on the savings continue and they start to pick up even more steam as that loan balance gets lower and lower.
Overall, I’m very satisfied with this month’s progress and it’s a great way to start the year off when it comes to my debt repayment. It’s probably going to be pretty much steady progress until we get towards the end of the Summer and then the dominoes will really start to fall. I just have to stay focused and try not to get down just because individual loans are not disappearing yet.
I’m also going to be tracking my progress against my goals for the year, so here’s how that went:
Main Goal: $20,000 Principal Reduction: $1,946.28 so far = 9.7%
Stretch Goal: $25,000 Principal Reduction $1,946.28 so far = 7.8%
Looking pretty good, I’m on pace or close to pace for my goals!
photo credit: Johan J.Ingles-Le Nobel via photopin cc
Great job! I’m so glad I never had student loans to contend with. Setting a plan and sticking to it is the only way out of debt and you’re doing great so far!
Thank you very much! I really wish I had known more going into college. I looked at starting salaries vs. how much debt I was taking on and it seemed like nothing at the time. Accrued interest (and a major switch) over 4 years really changed that total and my perspective. I can’t change the past now though, so I need to move forward and continue on my plan.
$2300 a month is awesome. Every bit you pay is helping with the interest. I have several friends who pay their student loans monthly and the amount they owe goes up because of the interest. Talk about depressing.
Thanks, I’m really hoping I can stick to that figure throughout the year. I know several people like that as well – or people that can barely afford to pay for the minimum. Their principal is only going down a few dollars each month. It’s rough when you have student loans.