My debt story, how I paid $23k worth in student loans

DebtStory-LIFESURVIVALDIARYDebt can come in many different ways, consumer debt, credit cards, other personal debt and the loathing student loans. My journey to acquiring, accepting and repayment has taken me to places and ideas never thought of.

Like many people who do not have college or saving accounts set at young age, have to borrow to afford an education. Early on in my education, I’ve been fortunate enough to acquire resources from my city, teachers and foundations. I attended college early to cut the cost of college. I’ve worked several part-time jobs to pay fees and books on my own until I maximized on whatever resource I was utilizing at the time. To fast forward through difficult times with managing priorities, I crashed and ended my college tenured with 10k in student loans. The 10k came from losing a major scholarship source in my 3rd year and then I was forced to borrow. At first I was upset with myself, and knew that the repayment of my lost scholarship would be in my future. (Until I appealed to the highest academic administrator with careful planning and decision making. I won the fight and did not repay the financial institution.)

When I began acquiring debt:  My first job out of college gave me a salary of 8k, scholarship and one year federal competitive edge for federal jobs I qualified for. The worst part about this job, it was a contract, but it got my foot in the door somewhere.  After the contract, a government position opened up and I took the job. Three months into the job, the government shut down and my position was consolidated with a senior partner position.  I was laid off, applied for unemployment and was denied because I did not meet the hours required to get paid. After an appeal from my end, I was granted a small weekly payment not enough to cover any of my bills. Mind you through this process my 10k student loans were on forbearance and I never paid, not even the interest.

For a year, I was living in financial hell and dreaded my 6 month job hunt. I used up my pension and regular savings until I started running up debt. I re-enrolled into a graduate program of my choice to save me from financial turmoil. When I received my acceptance letter for graduate studies, I was given stellar scholarship package. After three months of studies, I had to drop out of school because the idea of living beyond my means and making less on student handouts did not cover my cost of living. I found it difficult to keep my scholarship obligations at the school; I accepted my fate and left the university.

After series of job searches, underemployment, dropping out of school several times, I had to get it together. I had dropped out of graduate school three times, “almost” faced homelessness due to underemployment. I quickly learned that financially desperate people are not to be allowed in the financial aid office because many poor decisions are made there. I maxed out on the annual student loans offered, personal campus loans to make ends meet.

Now take note that all through this I wasn’t just carelessly maxing out for no reason, I was working full-time in the non-profit sector to cover for my medical expenses/insurance premiums, transportation and food costs. I was barely covering housing and utilities with my salary. Now six months before I graduated I had to repay back some personal loans through the campus, minus my federal loans. I started delaying the payoff date by taking fewer classes each quarter and apply extra money from my federal student loans to my campus loans. Eventually I completed all my classes and was forced to get a higher paying job. After three months of searching I found better pay, benefits and I was overjoyed. My hard work was finally paying off.

How I paid it off:
My student loan six months grace period went past me and all my loans were on repayment, all seven active accounts. My campus loan had a pending 7k for me to repay. I was a fool to not have read the fine print. For two years, I lived in financial misery and that lead to other problems in my life including my health. My pending campus loan stopped the school registrar from providing access to my records. The school withheld important things such as my degree verification and transcripts. I began working long hours for overtime pay, I worked a second job, I worked 70-80hrs a week for a full year and suffered burn outs and a mini stroke due to chronic stress and high blood pressure. I applied every tax return towards this loan; I requested other federal loan repayment plans and even used my sick status to appeal for hardship forbearance. (Long process: I won the fight and I was granted 4 months of no repayment to catch up on other debt.) All through this, if I had lived on credit cards, I would have filed for bankruptcy. Unfortunately student loans cannot be cleared through bankruptcy.

Road to hard lessons learned:
Through my journey of living beyond my means and in debt, a simple 10k loan ended up being 18K at the time of total repayment. For two years, I learned a painful lesson that almost cost me my life. I learned to live within my means, to not stress and accepted my desperate decisions.  I had to drastically cut my expenses to save me from overworking. All though, I am still not done with loans, I have 57k unpaid student loans waiting. In due time, my own personal home loan will be added.  We all have loans in some shape or form, but we really need to access if the loans are necessary. Did we get them from being responsible, reckless or desperate?

Lessons learned:
1. Live within/below your means at all cost. Especially as a student.
2. Don’t use school loans as your financial lifeline
3. Plan your academic career to every dollar that you don’t have
4. Always be employed at whatever cost
5. Build a saving account enough to last you 3-6 months of joblessness.
6. Appeal any decision you do not like and have documentation to make your claims
7. Save your tax returns
8. Seek professional help when all fails
9. Financial stress is #1 killer and can destroy other parts of your life
10. Always have a plan