student loans

#10 March Madness: Putting $5,000 Towards My Student Loans In One Month

Student loans suck. Let’s be real. It’s a slow-bleed of your bank account for years and a heavy weight to carry on your financial shoulders. American’s are living with a collective $1.5 trillion of student loan debt which is insane. That’s why it’s important to begin chipping away at your loans as quickly as possible and start making overpayments on your high-interest loans. Let’s see how I’m managing to take chunks out of my student loans.

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Chunking My Student Loans

Hey! Welcome back to my Hustle Young, Retire Early series, where I am documenting my journey to financial independence from $30k in student loan debt! If this is your first time here, I recommend starting from the beginning!

As of the beginning of March, I had paid off about $2,000 worth of my student loans since January. Since I’m not currently earning significant revenue from Minted Millennial, my paychecks from my full-time job are the only income source I’m currently using to pay off my loans.

So this puts us down to a little over $28,000 left on my loans.

At the beginning of 2020, I had set a goal to get my loans down to at least $20,000 by the end of the year. In order to achieve this, I would have to pay $10,000 over the course of 12 months, which averages out to about $850 per month.

In the month of March 2020, I plan on blowing this number out of the water. 

We are going to be putting $5,000 this month towards my loans. This is a lot for me considering my monthly spendable income is only $2,500.

As a small disclaimer, this is not meant to come off as me bragging or anything. I simply want to promote the mindset that we should always be planning ahead with our finances and be fully aware of where our money is going.

I want to demonstrate the importance of going all in on your financial goals.

So how will I put $5,000 towards my loans in one month with no supplementary income? Let’s break it down. 

Breakin It Down

First up, it’s tax szn.

Last year in 2019, I was a full-time student for half the year then started working at my full-time IT Consulting job for the second half of the year.

As my first full-time job, I had no idea how much of my taxes to withhold, so I didn’t withhold anything. And since I was a full-time student for half the year, this led to a sizable tax refund. 

A little over $4,000. Nice. 

As tempting as it was to put it all towards my student loans, I decided to follow my Spending Roadmap: The Ultimate Guide and round out my emergency fund first.

This meant allocating about $1,000 of my refund to put me at 3 months expenses in my high-yield savings account.

This left me with $3,150 to put into the loan with the highest interest! Check it out:

student loan payment

And yes, these are federal loans.

Sweet, that just brought my loans down to a total of around $25,000. We’re already at the halfway point of my total yearly goal of paying off $10,000!

But wait, there’s more!

Some companies send out paychecks on the 1st and 15th every month. Some companies pay biweekly. Mine happens to pay biweekly.

Since I’m on a biweekly payroll, there are a few months out of the year where the stars align and I get 2 paychecks in a row that I don’t have to pay rent with. Take a look: 


The circled dates are my biweekly paydays. If my rent is due on the 5th of the month at the latest, that means I had to pay March’s rent with my Feb 21 paycheck.

However, I am then able to pay April’s rent with my April 3rd paycheck, leaving both of my March paychecks open. 

I can spare $925 out of $1,250 from each of March’s paychecks, which comes out at 74% of the months income going towards paying down student loan debt! 

So, adding together $925 from both paychecks along with the $3,150 I got from my tax refund puts me right up at $5,000!

After accounting for the interest accruing on my loans, I will be down to a total of about $23,500 left at the end of March. 

Not too bad!

student loan payments

What's The Next Step?

We’re making strides, but we still have a long ways to go.

My focus over the next few months will be to:

  1. Spend less money
  2. Increase my income
  3. Allocate more towards my student loans

I want to keep accelerating my monthly payments by following these three focal points. 

It’s pretty clear I will definitely surpass my goal of getting my loans down to $20,000 by the end of the year considering I will be at $23,500 by the end of Q1. 

So let’s adjust that goal to get it down to HALF by the end of the year: $15,000!

Hell yeah.

I know this isn’t exactly a very replicable strategy, but the big takeaway is that how you spend your tax refund and take advantage of your spendable income is very important.

I could’ve easily just blew my money on clothes, electronics, and food (believe me, I wanted to), but I stayed the course and made a huge dent in my loans.

Keep chipping away at your debt, put every spare dollar towards it. No payment is too small. 

I also recommend looking into refinancing options! Personally, I can’t refinance since I have federal loans.

If you have private loans, I highly recommend seeing if you can get a lower rate.

Big moves were made in March. Let’s keep the foot on the pedal and keep grinding to become debt-free.

Thanks for reading, stay tuned for more posts in my series, Hustle Young, Retire Early (HYRE).

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