My wife and I both have substantial student loans. However, I consolidated mine at 3.5%, but her’s were consolidated at 8.25%.
Just to pay her interest is $ 700/month. My payment is $ 300, with 1/3 currently going to principle. We also have about $ 8,000 on credit cards at 10% interest.
Our combined income is about $ 100,000 annually. Right now, I pay the $ 350 on my loan each month, and about $ 1,200 on hers. At that rate, her loan should be paid off in around 8 years.
I just feel like I may need to rethink this approach, as it seems like we make a lot of money, but are not getting anywhere fast against our debt.
Oh, we also have about 75G’s in our 401Ks and put away 10% of our salary. We’re early 30′s. Any thoughts on how to reduce this debt more quickly? Some days it feels like we’d be better off defaulting and going to work at MacDonalds…lol
Thanks to everyone for taking the time to provide such great information. Looks like the theme is to pay off the highest interest debt first, while reducing montly expenses.
I am going to stop overpaying my wife’s loan until the credit card debt is gone. Also, I think it’s time to track just how much money we spend on food and drink each month! Time to bite the bullet.
Oh yeah….wish I could reconsolidate her loan, but that will take an act of Congress. Not really fair that you can refi your house but not your student loans.
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