We have paid our first loan! It is small but it is progress and is encouraging. The method though was probably unorthodox. My friends at The Total Money Makeover will probably not approve.
This school year I applied for $10,500 in student loans ($5250 for fall and $5250 for spring). I didn't need to take as many classes as I expected this last semester so I didn't use all the loan. When this happens the school writes you a refund check. I got a little over $2200 back. I use about $300 to pay for my books and used $919 to pay the first loan on my list off. I will be using the remaining $1000 to put towards my car loan which is next on the list.
So, even though I'm borrowing from Peter to pay Paul in this case, I'm not too worried. Debt is debt right? In the end, I have started my snowball and have been encouraged. This is the last time this will ever happen because I will NEVER HAVE A LOAN AGAIN!
So, I get to add $919 to my debt thermometer so it won't say $0 anymore. Yay!
1 comments:
Maybe I didn't understand your post correctly (or maybe it's because I haven't had coffee yet) but I don't understand how you can consider this a debt payment. Sure, you paid a debt... by taking on another debt. If I have a $2K balance on credit card A, and I sign up for a 0% credit card and use cash advance to pay off the $2K on credit card A, yes, I paid off a debt but my debt balance is still at $2K.
I really admire your can-do positive attitude. I wish you lots of luck, I'm sure you'll do it!
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