Student Loan Payoff update for 2016

 Hey it's that time of year when I go over the progress we made as we work on paying off Brandon's student loans.

First up we have some good news.  For the first year ever we have paid more in principal than in interest.  The red parts of this graph show the amount of interest we paid each year.  And the blue parts show the principal.  That blue part is pretty big this year.  That's good news.  

One reason we paid more principal was because we were able to completely pay off two loans in 2016.  Over the past six years we've paid off 5 of the 10 original loans.  All the small loans are now gone.  But we still have five very large loans left.  

 We paid more money on the student loans last year than any other year before.  The only year where we paid off more total debt was 2014 when we paid off the Honda as well as made a bunch of payments on the student loans.

 So those are all great things.  And I'm happy about them.

But there are some things I'm not so happy about.  One is that we only reached about 2/3 of the payment goal that I made for this year.  Yes, even with paying more than we ever did before we were still short of what I was hoping to do this year.

That's because that goal was based on the assumption that Brandon was going to spend the next six years in the Army. According to that plan we'd throw everything we had at the student loans while living in on-post housing or renting off post.

But when flight school didn't work out and Brandon decided to get out of the Army we had to change our financial plans.  The biggest thing was that we would probably have to buy a house.  And that meant we needed to start saving.

We already had $1000 in the bank as an emergency fund.  But that was about all we had.  Everything else was going to making extra payments on the student loans.

In June we stopped making those extra payments and went back to just paying the minimum amounts.  We started squirreling all our extra money into an account for buying a house/getting through this giant life change.

That account has been growing slowly but surely.  Thanks to Army reimbursements for moving expenses and the fact that we are currently living rent free we've been able to save quite a bit.  This savings combined with the tax refund we are expecting this year should help us have a good down payment on a house.  (Yes, I know the VA will help us buy a house without a down payment, but I'd like to have some equity in our house right away.)

I'm hoping that after we figure out our employment and housing situation we'll be in a good position to start attacking the student loans again.  But for now we are pretty much in a holding pattern with them until things settle down.

I want to add that I am so glad that we didn't put Brandon's loans into deferment while he was in active duty.  That was an option available to us, but the loans would have still accrued interest. It would have been terrible to add a huge student loan balance to our list of things to worry about as civilians.

Along those same lines, I'm also glad we didn't plan on student loan forgiveness if Brandon had been employed by the government for 10 years.  If we'd been counting on that he might have been forced with the decision to stay in the Army just to take care of the loans.  Ug that would have been disheartening.  

One final thing.  A few weeks ago I listened to a podcast from Reveal all about the student loan industry.  I highly recommend you listen to it if you have student loans.  I also want to warn you that you'll probably come away from it feeling pretty ticked off.  Here's the link. https://www.revealnews.org/episodes/whos-getting-rich-off-your-student-debt/

Slowly but surely we will get these stupid loans paid off.