Being in Love Helped Us Tackle Massive Student Loan Debt
A couple strengthens their relationship by facing money issues head on.
Tori and I were in college when we started dating. I paid for my schooling with the help of my parents, some part-time jobs, and scholarships.
(There is hope, though; a lot of student loan debt can be refinanced at a lower interest rate.)
Some people would run for the exit if they found out their future spouse had $80,000 in student loan debt. Luckily for us, we were in love and talked at length about the future financial challenges the debt would cause.
We were on the same page with our future financial goals. The first goal was to pay off Tori’s student loans. We lived a frugal lifestyle so that we aggressively pay down the debt for the first three years after she graduated from college. Every single extra penny went toward the loans — even our “fun money.”
It takes effort to put so much money toward debt, but it’s worth it. If you are in the same position, remind yourself that this challenge is temporary, and you’ll be free of a great burden when you’re done paying it off.
Combining Finances after Marriage
Before we were married, we kept our finances separate. However, Tori and I strongly believed in combining finances once we were married. And within a month of marrying, we did just that.
Next, we used the large chunk of money I saved before our marriage to knock out a big portion of her student loan debt.
Less than three years after she graduated, we paid off the $80,000 in full. We both felt as if a huge weight had been lifted off our shoulders. But we knew that wasn’t the end of our financial journey.
(Need more inspiration? Here’s another student loan success story written by a woman earning only $30,000 annually!)
Saving for Emergencies
Next, we aimed for a fully stocked emergency fund with enough money to survive for six months. We redirected the freed-up money that had been going toward the loan repayment and our emergency fund was full in a few months. (Want to know how we created our emergency fund?) This led us to our most recent financial challenge.
Tackling Investing Head On
It was now time to start investing. While we contributed to our 401(k)s and a Roth IRAs for retirement, our next goal would be to kick our retirement investing into high gear.
As a personal finance blogger, I know one of the biggest challenges in investing is determining risk tolerance — the ability to ride out market swings that can result in major losses. I knew I could handle large downturns as our retirement was at least 30 years away.
After talking with my wife, I realized she shared my her views about investing and we decided to invest most of our money in equities.
Next, we discussed how much we wanted to invest in our retirement. We hope Social Security will still be around when we retire, but we don’t want to rely on others for our financial future. So we decided to set aside a more aggressive percentage of our income toward retirement than a typical couple our age.
These Challenges Strengthened Our Relationship
I can’t express how awesome it is to be on the same financial page as your spouse. It helps you avoid one of the most common fights in marriage, the money fight. Thankfully, we’ve been able to talk about our finances openly.
(If you are struggling with money with your spouse, you may want to check out Cat Alford’s video on how to stop money fights.)
To find out whether you’re on the same page, start talking! Ask questions, and listen. Then, you can understand why your partner feels the way they do. Then, you can hopefully come to a consensus about how to manage your money that makes both of you comfortable and happy.
Whatever you do, don’t keep putting off the conversation. The earlier you and your significant other can understand each other’s views and goals are, the sooner you can work toward financial security.