A Public Declaration: Debt Free by December 31, 2013

I’m sick of it. Absolutely sick of this feeling. I’m tired of seeing that negative sign. I’m tired of shoveling $500 a month into a financial black hole. I’m tired of being another college-grad statistic.

I want to be debt free, and I want to be debt free now.

I’ve made real progress since I began paying down my loans three and half years ago – progress that I’m proud of.

But the one thing this debt has taught me is how impatient I am. I have no tolerance for being in a negative financial situation. I need to dump this debt once and for all.

And I need to do it this year.

Debt Free

Why Now?

Simply put, I want the freedom to do what I want while I’m still in my twenties. I don’t want massive debt payments weighing down my options for what I do with my money, how I earn it and where I take my career. I’ve stopped caring about the return on investment of my money. To me, debt is more than just a compounding interest rate – it’s a psychological, emotional and personal burden, and it matters more than the possible return I could get somewhere else.

My Public Declaration: Debt Free after 2013

So here it is, my public declaration to hold me accountable: as of December 31, 2013, I will be debt free. I will have spent 4 years and have paid off $30,000+ in student loans. I’ll be replacing the shackles of my $500-a-month student loan payment with the freedom of being able to choose what to do with my money.

December seems like a long way off, but it’s a daunting task with $7,600 left in debt. I have 287 days left for me to pay off $7,600 in debt. That’s about $30 a day, or $900 a month (give or take with interest still accumulating).

I don’t know how I’m going to do it, but I’m going to make it happen.

2013 is the year I become debt free.

But I know I need to set a few ground rules to make it happen.

My Rule to Becoming Debt Free

1. I can’t dip into my savings.

I spent a few weeks debating whether or not I should use my savings to pay off my student loans (at the time, I was breaking even with $13,000 in savings and $13,000 in debt). My savings are almost important to me as my debt – it provides me with freedom and flexibility. I don’t want to stop contributing to my emergency fund, my travel fund and my other big picture goals, so if I’m going to pay down my debt this year, it’ll be with money I earn

2. I’ll gradually increase my monthly payments.

I want to start slowly increasing my monthly loan payments and find my pain point. Right now, I’m putting about $500 toward my student loans. I bet I could put an extra $100 or $200 a month toward my debt. But $250? $300? How far could I take it without sacrificing too much of my savings or my day-to-day well-being?

3. Any extra money I earn will do toward my loans.

It felt great contributing part of my tax refund toward my student loans; it didn’t take away from my bi-monthly paycheck and I didn’t miss the extra money. I plan on using any “extra” money that comes my way to knocking out my debt, too. 

I may be crazy, I may be setting myself up for failure, but I think I can do it. So I’ll need all the words of support and encouragement I can get 🙂

Has anyone else done the seemingly impossible lately?

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