2012 Student Loan Debt Update and 2013 Goals!
Happy New Year everyone!
So, 2012 is over, and what a crazy year it was. I’m not sure how it passed me by so fast. The last half of the year was very busy for me between a lot of extra work at my day job (including some overtime) plus a side project eating up all of my time. Fortunately both opportunities allowed me to funnel some extra money towards my student loans.
Looking back at 2012
Last year I set some financial goals for myself that I thought would be realistically achievable. How did I do?
Goal 1: Reduce my private student loan debt to under $80K.
So…I got so close to this goal! After my December payments processed, I was at $80,702.53. Just $700 off.
At then end of 2011, my Sallie Mae loan balance was $90,962.54, so I paid off $10,260.01 (plus a TON of interest) over the course of the year. I didn’t hit the goal, but I am proud that I was able to eliminate $10K of debt.
Goal 2: Reduce my monthly payment amount to less than $900
Well, I doubted my ability to reach this goal when I set it, and I didn’t reach it. This was partially because I didn’t expect Sallie Mae to suddenly start postponing my monthly payment due dates instead of lowering my payment amount.
At the end of the year my monthly payment amount was at $953.67, a reduction of $43.30 from last year’s payment, so not too shabby.
Goal 3: Increase emergency savings to $3000
BAM! My current emergency fund is $3,059.21.
SLAYED IT!
2013 Goals
2013 should be a fun year. There’s a lot of things that are up in the air right now:
My Take Home Pay – With all of the fun things going on with taxes and increase in health insurance costs, my take home pay will probably go down. I should be getting a raise this year, but it’s unclear when or how much. I also am doing some freelance writing on the side of my day job which should earn me some extra cash, but how much remains to be seen.
My Monthly Student Loan Payment Amount – I haven’t made any payments on my federal student loans because my income has been so low (thanks 2 years of unemployment!) since graduation. This should be reassessed this month and I think I make enough now that they will require me to pay something. Until I get that bill, I won’t know though. This will mostly like take away from the extra amount that I usually send to Sallie Mae, so while I have the money, I don’t like the idea of it cutting away from paying down that high interest debt.
With those variables in mind, here are my goals for the year:
Goal 1: Get my total student loan debt under $100K
So I don’t ever talk about my federal loans on the blog, since I don’t have to pay them right now. Since that will probably change this month, I have to start thinking about them and figuring them into my budget and goals.
My total student loan debt is over $105K. While my Sallie Mae balance goes down each month, my federal loan balance goes up because I’m not making payments, but some of the accounts are still accruing interest. The interest rates are 1/2 to 1/3 of my Sallie Mae rates though, so I would rather focus my money on that while I can.
I think this goal is very achievable–it’s something I’ve been working towards since I graduated with about $130K in student loan debt and interest. I can’t wait to reach it!
Goal 2: Reduce my monthly payment amount to less than $900
Yep, I’m just rolling this goal over from last year. This means reducing the payment by $53.67. I can do it! Right?
Goal 3: Increase emergency savings to $4,000
Yeah, that’s only an increase of $1,000, but the budget is going to be a little bit tighter for me this year. Everything is going up and my take home pay is going to be less than it was last year. Hopefully side projects and a raise at work will make up some of the money, but that remains to be seen.
So that’s it! Hopefully when I sit down to write this post next year, I’ll be writing about success.
What are your goals (financial or otherwise) for 2013?