Category Archives: Debt Destruction

Trust the system


What does that mean anyway?

It means a set path. Following steps. That if you do A it will lead to B and then C.

But I am having trouble with this one.

See I’m taking an online course. Or should I say retaking it because last time I got stuck… Lost momentum and then stopped.

Trust the system I said to myself after watching the video. What the heck does that mean anyways? Continue reading Trust the system

Over 100K paid off in 3.5 years

When I started this blog, Traveling Wallet, I wasn’t in the death grip of debt. Actually I was about to make my escape.

I have written a few posts about my debt and my repayment journey.  But I really wanted to take the time and give you the whole big picture.

When I look at the numbers it just really amazes me. And I think its inspirational. That is why I am sharing.

Like I’ve said before when I graduated I had a ball and chain of student debt attached to me to the tune of $46,695. With $10k of it at a horrendous rate of


Can you say Wow!

But that wasn’t all. I had a car and no mechanical experience. To translate I knew nothing about this machine and when it started giving me problems and I drop some money into it just to have it give me problems again. I said if a fix is going to cost more then 1k then I’d rather “invest” it in a new to me car.

I didn’t want to get into more debt. I wanted to conquer my student debt before adding anything onto my plate.

But as green as I was in the whole matter well all I could see was that I needed a car for work.  The used cars at dealerships were not really a good deal. If its going to cost me that much I might as well buy new. Long story short say hello to $18,417.81 more debt. The bright side? it was at the much more affordable interest rate of 2.99%. When you don’t know what you don’t know any one can convince you that was the right choice.

I just didn’t know enough. I didn’t know how to go about buying from a private party and I didn’t know it would be cheaper.

So instead I did what I knew about, I bought new and with in a few months since  graduation my debt climbed to 65k.

Roamer debt
Snap shot of my old records.

Mr. Roamer and I were married in 2012 so our finances weren’t combined until then. But to simplify we will just take a snap shot of his debt at the same time Jan 2011 after graduation.

Actually scratch that. Let’s just make a time line and save ourselves the trouble.

  • Jan 2011
    • The Roamer graduates 46.7k of debt
    • Mr. Roamer graduates ~29k of debt
  • May 2011
    • The Roamer buys a car 18.5k of debt
  • September 2013
    • Mr. Roamer buy car ~20k
  • July 2014
    • Paid off all debt totaling ~ $114,200. One hundred fourteen thousand dollars 

So all in all we paid off 114.2K in 3.5 years. Now that is what I call aggressive debt repayment.

Still its slightly bittersweet because seeing that I think wow if only it was all assets instead. So much dropped on cars I regret it now. How much sooner would I be able to retire with another year of spending saved up and earning interest.

I’ve even considered selling. But for now the Roamer family isn’t ready for that change.

So how did we do it?

From the beginning we both had really good habits. Before we were married Mr rented a room out in California and reduced his costs. He naturally started to accumulate money in his account.

I focused on aggressive debt repayment right from the beginning. Going from a student to a worker meant there was a huge increase in my earnings and I made sure that a chunk would go straight to debt. Working to reduce costs I shopped around for the most affordable housing. I tracked my spending and I created a budget.

I also read. A Lot. about debt repayment. I learned about the snowball and I used small tips like rounding up my car payment of  $332 up to $335. I learned and understood about interest and so I purposefully focus on my 10k loan first.

I was aggressive by general standards but never as aggressive as I could be. I had this need to have a cash cushion and so I also started to accumulate money.

During this stage I know that what I did involved going to work and then coming home to my son.  Spending as much time with him as I could. I don’t remember feeling like I sacrificed but I was the sole provider for a family of 3.  My mom, my son and me.

There were challenges being the sole provider in our family situation but there were benefits too.  I got and still get “free”childcare.

But during this time I also experienced a major personal loss that could have derailed me financially one day I’ll talk about it more. So much just in 2011.

Then when Mr. And I got engaged we moved in together further lowering our costs. We discussed bigger spaces and even looked around but I just didn’t see the need. So we stayed put saved up and then had a meaningful wedding. One that focused on the marriage.

I never had the option to not be smart with my money. I had people depending on me as soon as I graduated college. I had no family to fall back on financially.  But I could count on my family to help out in other ways. Like for example the free childcare.

Do you have a debt Mountain to climb.

Your challenge might be tougher because you’ve already succumbed to life style inflation. But maybe you are ready to buckle down or maybe I’ve caught you at the perfect time right after graduation and meager college living.

What ever your circumstance I believe these steps will help you.

First steps to pay off Debt

  • Get you mind in the right place.  This means take a moment and think about what you truly value.
  • Track your spending. Why? Because now you need to see if your spending is in line with your values.
  • Adjust spending to = values. Lower your spending drastically on all the expenses that fall outside of your circle of values

Sometimes two of your values will conflict and it will turn into a would you rather scenario. Would you rather have your own space or would you rather pay off your debt. I’m not saying there won’t be some tough choices but at least you’ll know that they’re in line with your values.

It really is inspiring to hear other peoples debt stories. That is why I Roamer around other peoples blogs.

Leave a comment and tell me are you in Debt? Are you seeing the end of the tunnel? Or did you just cross the finish line?


Why I don’t endorse student loan forgiveness

Are you telling me you want to exempt and forgive people from paying student loans that they consciously got into of their very own volition.

Have you ever heard the phrase necessity is the mother of invention.

In plain English that means if you need it you will figure out a solution.

As a person who just recently conquered student debt  I have to ask myself, Why is this topic even on the table?

The truth is the real problem is that so much money is being borrowed so let address the real issue not the symptom. People being way in debt is not the cause of the problem it’s the result. The real problem is that students go into college not really understanding how money works and what it will all look like when they get out.

Oh and they accept defeat. As in ” School is so high cost I can’t possibly get an education with out going so into debt that my brain will explode.  But hey, a degree is important it doesn’t really matter in what I just need one.  After all its the only way to get a job”

So instead of being reactive, lets get some stuff in place to prevent the problem in the first place. 

Simple rules I never heard of before college but that every student should know before picking their degree.

Before you get into DEBT 

  • Don’t get into more debt then your degrees starting salary. So, know what your degree is actually worth, not just the sticker price.
  • Work during school, to pay for school(work study or better yet attend a school where working is part of the graduation requirement, I did and made 15/hr right out of high school in my field of study)
  • Apply for scholarships merit or other.  There are scholarships out there for so many things not all based on GPA. It takes time but you can find them, ” I got a scholarship for 12k a year just for being from California, no joke”
  • Realize the cost of every hr of class, Don’t retake classes. Seriously I was not the best student and retook quite a few classes. IT COST ME DEARLY. In my last year of school, the extra one I had to take due to my lack of focus , I about doubled my debt, I owed 26K and jumped all the way up to 46K in one year. Bye bye scholarship only good for 4 years.
  • Don’t ignore the schools that pay you to go. Your financial aid package should definitely be one of the determining factors for where you study.
  • Student loans are not for buying cars ( seriously I saw a shirt in college that said Sallie Mae paid for my car, I was like what does that mean? Oh that they borrowed money to buy a car. Really what the F? )
  • Most all college/universities have free extracurricular activities for enrichment and entertainment purposes. Plan to use them.

After you are in DEBT

  • After you graduate keep living like a college student.
  • You can deduct some interest in your taxes if you make less then a certain amount so, Use the tax refund you get on interest, to pay the principle . Sorry no fun money.
  • Pay highest interest rate first.
  • Watch your balance like a hawk call the provider, suffer the long wait to make sure any extra money goes to the principle
  • Use the grace period to pay down principle. 
  • Pay interest if you can during school. ( some loans accumulate interest during schooling some don’t) This prevents it from capitalizing and having your interest earn interest.
  • Max out subsidized loans first
  • Realize that debt is bad!! It doesn’t matter if it’s for coffee or university  most debt means interest, and interest means you are paying (giving away) extra money. The sooner you pay it off the less interest you will pay over all.
  • Get your priorities straight.

Lets take a look at the first bullet point.  Don’t borrow more then your starting salary. Let look at a really over simplified chart.

oversimplified graph
oversimplified graph

In this chart we just looked at the numbers, if you borrow more then your starting salary you are already extending the payment years, because you couldn’t even cover it with all your new fancy salary. This chart doesn’t even take into consideration interest, add that in and you’ll get a really ugly picture for people who over borrow.

 Now let say you can save half, much more realistic well it will take you 4 yrs to pay it off if you borrow more then your starting salary. Now if it was less then your yearly salary it would take 2 yr to pay off saving half the income.

What message are you sending?

All this is asking is learn to pay your bills. Create good habits.

I recently read an article where the question was I’m drowning in so much debt I feel like I’ll never be able to buy a car or house..hmm lets see if you can’t pay off $ 500 a month what makes you think your ready for a $ 2000 a month house payment? Clearly this pain you feel is a red flag, but the lesson to learn is not how do I get out of the obligation, it’s how do I learn to manage my money better. Oh and it also means, yeah you can’t afford to buy that truck and house yet since you can’t pay off a debt 1/10 as big.

Sorry the truth hurts.

So I say let people learn how to manage their money now and look at the long term impact of their decisions so that you don’t train people to think its ok to borrow more then you can payback. Who knows maybe this will translate to all their purchases and we won’t have people who can’t even save 20% down for a house, maxing out the
limit of what they can borrow and later filing for bankruptcy ….(A Utopian financially literate world…HEY, I can DREAM can’t I)

With all these tips why should we forgive student debt . You got into it knowingly it’s just another bill.

But just for another visual I ran some more numbers

Student loan chart
Looking at numbers for different debt situations, and some alternative payment options.

In the above chart we have different debt situations but the message its trying to convey is how much bigger your minimum payment can get. It also shows how just adding a few more dollars to your payment reduces your term sentence and saves you lots on interest. Sure its not taking into consideration if you have children or just bought a house or new car. But if you follow the rule about not borrowing more then you make the alternative payment plan is reasonable. We were able to set aside $1480 per month for our student debt and that still included $400  of fun money in our budget.

I say start holding people accountable for their decisions specially if they are fabricated problems. As in you can spend $100 a week on a bar tab but you can’t scrape together the $300 a month to pay of some principle to your loan. ( If your sharp you noticed that $100 a week equals $400 a month and you could redirect that fun money to your job of paying off that loan money). Or if you are going on international vacations or any other unnecessary spending when you have a financial obligation. 

Do you know a high school graduate who is about to transition to the real world. Pass them the advice and set them up for success
It’s true that you can lead a horse to water but you can’t make it drink . But if you put a bunch of financial puddles around them you can at least hope they’ll get their feet wet.

What do you think? Do most people have a valid reason for needing their student loans forgiven?

– The Roamer

If you want to read more of my student loan debt pay off read my article University Debt Freedom.

University Debt Freedom

Hello Sunshine, Hello breath of fresh air, Hello Freedom!

Today was the day, I recently sent in the last payment on my last student loan and today I received the marvelous confirmation that proves it all.

When I started this student loan repayment journey it was 2011 and I was over $46,000.00 in the hole. The school loan companies(government included) in all their infinite wisdom gave me 10 years to pay it all off.  How thoughtful and generous of them??

Let me see I thought I am 23 soon to be 24+10=34. I would be 34 years old when I would finish paying off my loans! 34! really? No thank you. Plus what about all the interest? Lets see if I did my math right it would come out to about $18,000 that’s a total of $64,000 after everything is said and done. Nope. Nope. Nope.

I knew from the very beginning there was no way I was just going to give $18,000 away.  I mean that is what you do when you pay interest. No, instead I figured out what my payments needed be to pay it all off in 5 years. Heck, I even did the math to pay it off in 6 years in case I had some emergency or something but that was it, 6 years was my MAX and 5 years was my goal. That goal included dropping extra cash that came my way with things such as tax refunds.

5 year plan

With the 5 yr plan I would only give away ~$8500 in interest with a monthly payment of $880 and $2500 in tax refund money. This would save me about $10,000 and 5 yrs of worry and stress paying everything off by Jan 2016.

What really Happened

Its Early 2014 and I already reached my GOAL! Paying off my student loans in 3.25 years. I’ve included a table below to show how it all breaks down. Now the numbers on the table are ball park calculations using 7% interest rate but that’s not 100% since really my loans ranged from 4.5% to an ugly 10.63%. Even my payments for year 3 are the average. The way it really went down was starting off with the $880 payments to finish up in 5 years and then upping it all the way to $1480. With extra cash dropped in when it came along (tax refunds) . But I wanted you to get an idea and the difference in the interest rates is no joke even if you do think I’m off $100 its still several thousand dollars difference for every year you add on.

Isn't math fun!

Isn’t math fun!

 My Advice

So here is my advice for any graduating students use the grace period to your advantage and start paying some dollars right away. If it means you are not pay interest great for you.

1. Do the Math

Unfortunately nobody is going to advise you about this, thinking of what’s best for you. Most people will try to get you to extend the life of the loan to minimize the payment per month. That’s like buying a pizza on credit and by the time you actually pay it off it cost you $100 buck. Would you pay $100 for a pizza? Not likely so forget about the monthly payment for a little and do the math to figure out what it really is going to cost you down the line. Some interest rates are so high that by the end of it you end up paying double what you owe. Does that sound like a smart thing to do?(refer to pizza example and hopefully be saying no). I mean you could have gotten a second degree or gone on vacation with the interest you’re paying.

2. Pay Attention

Don’t submit extra money and assume it’s going to the most logical place. I have a secret its not! Yup this is the most annoying thing of all but as you learn about finances you’ll realize that you want to pay off the loan with the highest interest rate first. But nope the loan companies wont do that, that just makes to much sense they will most likely apply it to the loan with (GASP) the smallest interest rate. Well of course they would this means they can keep extracting from you the biggest amount of money. So PAY ATTENTION, CALL as many times as you have to make sure your money is going in the right place. For people with big balances this could be thousands of dollars in extra interest.

I’m really jazzed about this life event, And I hope this makes you realize that doing a little math can save you thousands upon thousands of dollars. ..And even though I am glad I got my education I don’t want to pay anymore then what its worth.

Do you have Student DEBT ? When will you reach freedom? Will you do the math to get there sooner?

-The Roamer Out



Happy New Year Debt!

Narrator Note:  So I've been pondering how best to make this post. I know it's an important one and highly needed to set the baseline of what I, The Roamer, am working with in regard to debt and to better highlight any accomplishments. So, I decided to take the plunge and just keep it short and to the point. 

The Start of 2014 greeted the Roamer clan with the following debt numbers, savings, and retirement contributions.

Student loan debt $9046.44 with 6%

Toyota loan $8902.75 with 2.99%

Honda loan $17,479.69 with 1.99%

That’s a grand total of $35,428.88

With a joint saving account with ~ $11,000.00

Actively contributing to a 401k 15% of one earners income so less than 15% of our total earnings.

But more significantly was the mindset we were actively only concerned with quickly paying off Student loan debt and had even just financed a new car in September. Effectively increasing our debt.

So there you have it the baseline for 2014

Break the Mold (Family, World and Riches)

Thanks for visiting me at traveling wallet.

This Blog is about money  and its relationship(role) to Parenthood, Travel and Early Retirement. (See tag line 😉 )

I’m here to talk about my journey in working to optimize these 3 areas. Currently we (spouse and I ) are working parents. My current goals in life are to spend more time with my family( i.e. kids) and still save enough money to Travel and reach Early Retirement. But  the first thing is  to get rid of all my/our debt.


– Destroy Debt!

– Actually raise our children

-Travel (1-2 trips a year any combination of  in state, out of state, and international)

-Early Retirement (as in 50 or younger shooting for 45)

So lets talk about why savvy spending and savvy saving are the best way to see the world while working toward other goals. I mean I  don’t know what can be more fulfilling than becoming financially independent (early retiree) while also having a chance to taste life with all its cultures,customs, people and dishes and have the people you love most along for the ride. I also want to help you get there, whatever your goals maybe. Life and trips are always better with friends so I hope to see you again.

– The Roamer