Could you pay off your veterinary student loan in 26 months?
This practitioner offers his family's plan for budgeting and working to pay down $110,000 in school debt.
My wife, Kaysey, and I knew from the very beginning that we wanted to pay off our college loans as quickly as possible. We didn't want to look up 10 years from now and still have massive amounts of student loan debt hanging over us. We knew debt might hinder us from attaining some of our other major goals, such as becoming veterinary practice owners, becoming parents, and maybe even retiring early.
We were fortunate that Kaysey was able to graduate veterinary school without any student loans. This allowed us to focus on my veterinary school loan debt, which was about $110,000. Even with just one of us owing student loan debt, the monthly payment was still about $900. Considering that the loans were on a 30-year plan, we realized we would have ultimately paid more than $200,000 in interest by the time we had satisfied the debt. That alone was enough to motivate us. Just think, you could own a $200,000 house free-and-clear, or you could just be finishing paying off your student loan.
We made the decision to get serious about paying off the debt as quickly as possible. We knew that in order to do this, we would have to make some changes in how we handled our money.
Make do with less
Looking back at expenses from previous months, we realized we were spending a lot of money on things like eating out and going to movies. Some months we were spending upwards of $450 on eating out alone. When we started budgeting, we set ourselves a limit of $100 per month for restaurants. If you think that doesn't sound like much, you're right. There were many times we stayed home instead of going out with friends, or had to come up with cheaper ways to hang out. By doing this, we instantly saved $350 each month that could be applied to the student loan debt. We applied this principle to movies and groceries as well.
Over time, we were able to develop a budget we could meet with my income alone. Once that was achieved, we were free to apply Kaysey's entire income towards the student loan debt. Whenever we'd receive a bonus or a raise, we'd keep our lifestyle the same and apply that extra money towards the debt. Because every month is different, we revised our budget monthly. I would definitely advise not using a cookie-cutter budget month after month. Things change and you should plan for those changes, especially when you know what they are in advance.
Jonathan and Kaysey enjoyed going to Mississippi State football games while they were working to get out of debt because of the low cost to attend.
Keep the budget fluid
We set aside one night a month to look over the budget and make changes for the coming month. This included determining whether any yearly dues or expenses were coming due. We also included any special requests, such as the purchase of a special outfit or a special birthday gift.
We operated on a zero-sum budget, meaning that when money was added to a category, it had to be subtracted from another one. If we had an unexpected car repair of $200, then we'd review the budget and determine which category (or categories) we could transfer the money from. It was important to adhere to the budget as strictly as possible. Kaysey and I viewed it like a contract. Once the budget was in place and agreed upon we couldn't change it unless both of us knew about the changes and agreed. This helped keep us accountable and on track. The key thing to remember is budgets only work when all parties have an equal vote.
Sacrifice now for a better career down the road
The other major factor in becoming debt free was good old-fashioned hard work. Kaysey and I worked as much as we could. We were willing to sacrifice early in our careers so we'd have more flexibility as we advanced.
To paint a clearer picture, Kaysey wasn't offered a full-time position when she graduated. The only offer she received was a part-time job working two days a week. It wasn't her ideal beginning to her career, but she was willing to take what she could get. Through connections made in that first part-time job, she's reached a point where she's had to turn down job opportunities. It's also allowed her to be more selective in the jobs she takes and to demand more compensation. The point is that your first job doesn't necessarily have to be your dream job. Don't be afraid to jump in, network and learn new things.
Defer big-ticket luxuries
Finally, we delayed large purchases and lived frugally to aid us in becoming debt-free. We didn't buy an extravagant home. We purchased a home with a monthly mortgage payment that was only 15 percent of our take-home pay, instead of 2 to 30 percent, which is what the bank approved us for. We didn't purchase brand-new vehicles. Instead, we drove our 1997 Pontiac Grand Prix and 2000 Toyota 4-Runner. We didn't take extravagant vacations, instead choosing to spend a weekend in Gulf Shores, Ala., or somewhere similar.
Here Jonathan and Kaysey are on Caribbean cruise, which was their first real vacation after becoming debt free. They saved up for the trip before going.
With budgeting, hard work and frugal living, we were able to pay off our entire student loan debt of $110,000 in just over two years (26 months to be exact). Kaysey and I agree: The best time to tackle your loans is now. Keep your lifestyle simple, learn to delay pleasure and attack those loans. You'll be amazed at how much you can accomplish when you apply some of the same steps that we did.
Dr. Jonathan Faulkner graduated from Mississippi State University College of Veterinary Medicine in 2008, and now works at North State Animal and Bird Hospital in Jackson, Miss. His wife, Dr. Kaysey Faulkner, who co-wrote the article, graduated from Mississippi State University College of Veterinary Medicine in 2009, and now works as a relief veterinarian for multiple clinics in the greater Jackson area.