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Do You Wanna See It? Do You Wanna See a Screenshot of My Last Student Loan Payment Ever?

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Many of my readers have been along for the ride for the full duration of this accelerated student loan repayment plan. And I understand that many of you find yourselves inspired by my progress in repaying these student loans. Well, I wanted to share another great little “feeling of accomplishment” moment with you. Below you’ll find a cropped screenshot of the confirmation page for the last student loan payment that I’ll ever make. Go ahead, take a look and let it soak in just like I did:

A screenshot of the confirmation page from my last student loan payment ever!

A screenshot of the confirmation page from my last student loan payment ever!

Setting up that payment for August 19th felt pretty good. Granted, I probably won’t be able to make any big announcement about my loans being fully repaid until a few days after August 19th, but now I know that this repayment is really just days away from being over. And it feels pretty good!

It reminds me of when I sent the last check to the New Jersey Higher Education Student Assistance Authority. Of course that feeling of relief was intertwined with the joy of no longer having to deal with rude, arrogant people at NJHESAA. I’ve never had a problem with MOHELA or the USED before they sold my loan. It was a pleasant experience. You know, “pleasant” in that the people were good to work with and responsive on the phone and via e-mail. I mean I could use all of that money that I paid in student loans if the government wants to give it back!

Ahem… “And Now, The End is Near, And So I Face The Final Curtain”

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As Frankie sang in My Way, “And now, the end is near, and so I face the final curtain.” After last month’s student loan update where I announced that I only had $3 thousand remaining in total student loan debt, you can probably guess what this update is about. As of a few days ago, my student loans are down to just $1 thousand. To be more precise, I’m down to about $1,150 left outstanding on the loans. And yes, I can absolutely tap into one of my savings accounts and repay this balance tomorrow if I wanted to, but the plan to fully repay the loan right after the middle of August remains in place.

Only $1 thousand remains...

For some reason, I feel a bit of a connection with this Sinatra song as it relates to my student loan repayment plan. I really did do this whole thing my way. I can’t tell you how many people have said to me over the years that I should slow down my repayment because student loans are “good debt” and the interest rate (which started at 4.50%, but went down to 4.25% when I accepted automatic payments from the United States Department of Education) is a “good rate.” Other people suggested that I should accelerate my payments even more than I was doing (which, frankly, would have been impossible). In fact, ever since these student loans went from a 5-figure outstanding balance to a 4-figure outstanding balance, I could have paid them off with little-to-no harm done to any of my long-term savings accounts.

But that wasn’t part of the plan.

My plan was to make a series of calculated payments that I charted out on a custom-made spreadsheet (a version of which you can download here) and to revisit that spreadsheet as well as my personal financial accounting on a daily basis. That was the plan and that’s what I did. And now here I am with just $1 thousand left to pay on my student loans. Regardless of the funds that I have sitting in any number of savings or checking accounts, the plan dictates that the final payment will be made slightly after the middle of August – and that’s when I’m going to make it.

Researching the situation, creating a plan, and sticking to the plan is what brought me here. I’m not going to change that plan just because I’m steps away from the finish line.

I know I don’t even have to tease the next student loan update, but why not? Stick around, everyone… The next student loan update will be coming in August just after the middle of the month and it’s going to be a pretty big one!

In July 2006 I began repaying $120,603.31 in student loan debt. This debt is comprised of $106,070.00 in loan principal, $12,434.58 in capitalized interest, and $2,098.73 in closing and refinancing fees. To date, I’ve repaid a total of $120 thousand in principal and more than $28 thousand in interest. My lenders include the United States Department of Education’s (USED) Perkins loan program, the USED’s subsidized and unsubsidized Direct Loan programs, the New Jersey Higher Education Student Assistance Authority’s NJCLASS program, and CitiBank. The USED sold my student loan to the Missouri Higher Education Loan Authority (MOHELA) in April 2012. I currently owe about $1 thousand in principal to MOHELA. Follow my student loan repayment story on JerseySmarts.com.

Some Thoughts on Interacting with the NJHESAA From Two Real-Life Borrowers

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Over the years I’ve gone out of my way to be as honest and truthful as possible when writing about my student loan repayment. If you’ve been reading this blog for a while, then you know that I do not keep quiet in my praise of what “works” and I am equally as vocal about what is broken in the student loan industry. I’m a fan of the United States Department of Education and the way that they operate their student loan shop. Granted, I wasn’t happy when they sold my loan to the Missouri Higher Education Loan Authority without my approval, but that’s part of the fine print. In the grand scheme of things, the USED has been great to work with over the years.

On the flip side, the New Jersey Higher Education Student Assistance Authority was a miserable service provider. In almost every aspect of the borrower-lender relationship, the NJHESAA failed. And according to the comments on this blog, the NJHESAA failed many other borrowers, too.

As I begin to wind down my student loan repayments, today I’d like to bring to you the story of another college graduate saddled with a large student loan debt. In particular, I’d like to bring you the story of Jennifer and the $27,000 that she owes to NJHESAA. The story below is the exchange that Jennifer and I had over e-mail and please understand that names have been changed to protect the innocent (because I know there are dubious folks from quasi-state agencies who troll this blog).

Jennifer’s First E-Mail to Me:

Hi Joe!
I have just spent a good hour or two reading some of your blogs about your student loan journey. I myself have a loan through HESAA that frustrates me to no end and I was wondering if you could give me any tips? I currently owe them about 27,000 and my minimum payment is 266.00 a month. I have other student loans but they are all federal and as you know with a much lower interest rate.

So as for my HESAA loan, I have been paying $400 a month on this loan and I pay a little extra on my other student loans each month as well. I pay the most on my HESAA loan each month because it has the highest balance and interest rate. Is this a good approach or should I be doing the snow ball affect you spoke of in one of your blogs?

I pay my HESAA loan online. Do they still have a 2.5% charge that you have talked about?! If that’s the case maybe I should mail them a check?

With my other loans, I am able to see my original loan amount and payments remaining but HESAA doesn’t show this?! I have called them to have them send me something stating my original loan amount and how many payments I have remaining and they can’t seem to do this?! Also no matter how much I overpay on this loan (I have tried the bi-weekly method of paying this loan) I still owe the $266.00 on the 12th of each month.

I just know you have experience with this horrible company and was wondering if you could give me any tips?!

I appreciate your time and your blog is inspiring!

Thank you,
Jennifer

My Response to Jennifer:

Hi Jennifer,

Thanks for reading about my journey with the student loans and I’m glad that you find my story inspiring. I’m currently at about $3 thousand and my projections show that I’ll be fully repaid in about 6 weeks. It’s pretty exciting.

The absolute worst part of my journey was with the NJHESAA. What frustrated me the most about them (and this may be useful for you to understand in your dealings with them) is that they automatically default to the position that the customer is wrong. So if you call them and ask any question about any loan that you have with them, be prepared to be greeted with arrogance, frustration (on their end because you’re so “stupid” in their eyes), and a ready willingness to tell you false information just to get you off of the phone. Quite frankly, their arrogance is worthy of a state investigation as a crime against any of their borrowers. And what I always got a kick out of when I called them was that here I am – a guy with a Bachelor’s Degree with three minors, a Graduate Certificate, a Masters Degree, and a healthy job in high-level finance – and they would act like I was the biggest moron in the world.

The NJHESAA is truly an astounding display of how unqualified people can rise up the ranks of a quasi-governmental agency. Shameful.

As for your situation, I always recommend the snowball approach, but it depends on your other loans. For example, if you have a loan with the federal government and the balance is very low (i.e. something that you can pay off in a matter of 4 – 6 months using the snowball effect), then pay that loan off first. Financial planners would disagree and say to always attack the highest rate loan first, but I think there is something to be said for moral victories. Retiring a student loan – even if the balance is low – gives you a great feeling of accomplishment. Plus, what the financial planners never really talk about (because it’s hard to explain and for a person to financially model in their minds) is the fact that even if you’re paying a higher interest rate on a loan, you’re not really realizing that interest rate in full if you pay it off early. In other words, if you focus on eliminating a lower balance, lower interest rate federal loan and then focus on retiring a higher interest rate, higher balance NJHESAA loan, well you’re not really paying the full interest rate on the NJHESAA loan because you’re going to pay it off early. True, you’ll be paying the full interest rate for the time that the loan is outstanding, but by decreasing the overall amount of time that you spend repaying the loan (by making additional principal payments), your effective interest rate falls.

I once found a good calculator online that explained this a lot better than I can. Of course, I lost that link. If I find it again, I’ll send it over.

I’m not sure if NJHESAA still has the fee for online payments. Once I repaid my loan, I pushed that miserable company out of my life for good. Although I have to admit, I don’t think that they’re done with me yet. I have a mailing list for my blog where folks can sign-up to receive a quarterly list of some of the better entries from the last quarter. Guess who signed up for that mailing list? That’s right – the NJHESAA (and it was their PR person who signed up, too). Probably has something to do with the fact that when you Google NJHESAA, my blog tends to be towards the top of the list…

In general, my advice to anyone repaying a large student loan is to learn to really get in touch with your wants, your needs, and your finances. By this I mean that I was only able to drastically reduce my student loans by living an extremely frugal lifestyle. After I graduated, when my friends would be in the area and wanted to go to the bar – I said no. I couldn’t afford to spend the money. When my buddies made a trip to AC and they wanted me to come along – I said no. My big gamble in life was taking on the student loans (which paid off; and now I go to AC once or twice a year). When I found myself in relationships where the girl I was dating was fixated on a lifestyle of consumption and acquiring material things, I left those relationships. Sure, sometimes it sucks to leave someone that you think you could really care about, but you must consider the bigger picture. If you date someone today who gets upset that you can’t go out to dinner a few nights each week or who wants to move in with you to live in a bigger, more expensive place or town, then what’s life going to be like when you’re debt free? Is that person going to demand more consumption and more keeping up with the Joneses?

Some folks think that is a bleak outlook on life, but I argue it’s the exact opposite. Think of how many people are divorced because of “irreconcilable difference.” That’s exactly what’s irreconcilable – constantly spending money without being smart or saving!

And the final bit of advice (which you probably picked up from my blog anyway), is to work your tail off. I spent my 20s and now the first two years of my 30s working around the clock. Nearly everyday would bring a new deadline to meet. Life has become incredibly crazy, but building this type of work ethic has opened two important doors for me. First, it allowed me to really increase my income to where I could make the over payments. Second, it gave me access to new and better money-making opportunities. A quick example is my work teaching at the local college. Because I was an adjunct there (teaching only 2 – 3 courses each year), the door opened up for me to work at an online college. The pay is much better and the hours are much easier with the online college and that door wouldn’t have opened if I didn’t take the opportunity at the local college – and I wouldn’t have been able to work the local college opportunity if I was out drinking and carousing with the guys.

Everything fits together like a weird, but awesome puzzle!

Before I hit send – a question for you: Do you mind if I use this e-mail exchange on the blog? Names would be changed to protect identities, but I think it’s a good discussion about student loans. Let me know.

Best regards,,
Joe

Jennifer’s Final Response to Me:

Hi Joe,

Thank you so much for your reply 🙂 I wasn’t sure if you were going to get my email or not. That’s really funny about NJHESAA subscribing to your blog. They are such scam artists it’s not even funny! I just received an email from them yesterday actually. After I called them a week or two ago and asked for something stating my original loan balance and how many payments were remaining I received a billing statement in the mail (stating nothing of what I had asked for). So I tried through email to get a response. They emailed me back saying to refer back to my original loan disclosure(which I obviously don’t have or I wouldn’t be asking them for this information) and informed me they were unable to give me a duplicate copy of the loan disclosure! This company is a joke and I can’t wait to be done with them! This is one of the main reasons I pay them more than my other loan companies. The other ones I am able to obtain any information I need without a problem…not NJHESAA!

Of course you are free to use our correspondence. I am sure there are plenty of others in the same boat as me wondering the same questions 🙂

Thank you so much for your time!

I hope you enjoyed this interaction between Jennifer and I regarding our student loans. The moral of the story here is that you are probably not alone in your frustration with your student loan servicer. In fact, you should be intelligently loud and make some noise about your student loan servicer if they are not meeting your needs or treating you horribly. And if all else fails, feel free to start your path to justice by leaving a comment on blogs like this one. You never know where it might lead you!

My Student Loans Fall to $3 Thousand With the Final Payments Already Planned

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Believe it or not, it was a little under a month ago when I last wrote about how I was coming to the end of this long, drawn out, extended student loan repayment process. Well, as the headline of this entry suggests I’m now down to approximately $3 thousand left in total student loan debt. That’s a $4 thousand drop in the last month. I wouldn’t be able to make this payment if it was not for the online college where I work part-time as a mentor. Folks, if you stumbled upon this site and you’re wondering how I’ve been able to repay $117,000 in student loan principal in just about 7 years (only half of which where I really focused on repaying these loans), the answer is a crazy mixture of being frugal and spending your free time working more than a typical 9-to-5 job. I expect that I’ll have a few entries prepared prior to the end of this repayment plan explaining in more detail about how I managed to repay this loan so efficiently.

Just $3 thousand left

For those of you who have been following along on this blog during my repayment journey, you know that I frequently reference the financial discipline that is needed in order to make this whole thing work. I also reference the different tools (spreadsheets) that I’ve created to help me along in this aggressive repayment plan. As of this entry, I’ve used those tools to determine what the date will be of my final student loan payment. According to my plans, that date should be coming right after the middle of this August.

The other somewhat exciting thing that my spreadsheets show is that almost immediately after this repayment plan is over, I’ll be able to finally reap the financial rewards that my many jobs should have been providing me over the years. For example, after this repayment plan ends in the middle of August, I’ll be just two weeks away from a new semester starting. And when the new semester starts, I’ll be teaching again at the local college which means I’ll begin earning the few bucks that they pay adjuncts; in the past I’ve always used that income to repay the loans. Then, two weeks after that job starts, I’m scheduled to receive the next payment from the online college where I mentor students. That’s all the while my regular pay continues to come in and the biweekly adjunct income continues through the week before Christmas.

Since I began teaching part-time in the Fall of 2007, I’ve never really held on to any of that money. Just about all of it has gone towards repaying these student loans. It’ll be a nice change to be able to take some of that money and bolster my savings, investments, and retirement accounts to the levels that they should be for a 32 year old. And that’s an important point to make: I’m not going to squander any excess income that may come from these secondary employment positions. Instead, I’m going to use that extra income to increase my investments and retirement accounts.

The next few weeks should be fun leading into the end of this repayment plan. And the few months following the end of the plan should be fun to say the least!

On May 14, 2006, I graduated from Rutgers University with a master’s degree and $120,720 in student loan debt. In July 2006 I made my first payment on these student loans and, so far, I’ve repaid a total of $118 thousand in principal. My lenders include the United States Department of Education’s (USED) Perkins loan program, the USED’s subsidized and unsubsidized Direct Loan programs, the New Jersey Higher Education Student Assistance Authority’s NJCLASS program, and CitiBank. The USED sold my student loan to the Missouri Higher Education Loan Authority (MOHELA) on April 16, 2012. I currently owe about $3 thousand in principal to MOHELA. To date, I’ve repaid over $35 thousand in interest to these lenders. Follow my student loan repayment story on JerseySmarts.com.

The Next Big Thing, Part 1 – What Should I Tackle After Student Loans?

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This entry is the beginning of a three part series discussing what the next big thing will be for me after my student loans are fully repaid. Today, I’ll discuss two areas that are worthy of my hyperfocus while on Wednesday I’ll let you know which direction I’ve opted to move in for this big decision. Then on Friday, I’ll wrap-up this three part series with some thoughts about how I might begin the next hyperfocus. I hope you enjoy reading this miniseries!

The full repayment of my student loan debt should be coming up in the next few weeks. And if it’s not in the next few weeks, then it will certainly occur at some point this summer – and hopefully sooner rather than later. Those of you who have been along for the ride via this blog, my twitter feed, and through our personal discussions know that I’ve spent the last few years hyperfocused on repaying my student loan debt. There is a lot of discipline and new skills that come along with successfully hyperfocusing on one aspect of your life. With my student loans, for example, I’ve crafted some exceptionally useful spreadsheets using Microsoft Excel to track my income and expenses. These aren’t your run of the mill spreadsheets that one can find for download off of any financial website. Instead, these are highly customized spreadsheets that I built from the ground up and that I’ve been using day in and day out for years to track my income and expenses, short and long-term financial goals, and debt repayment.

Honestly, I’m not sure if I would have been able to quickly and successfully decimate my student loan debt without the organizational help and long-term planning provided by using these spreadsheets on a daily basis.

The big decision - which direction do I go in next?

The big decision – which direction do I go in next?

When you set your mind to completing a long-term goal, your mind will use your innate abilities to adapt your environment to help you achieve that goal. For me that innate readjustment was spending more time doing long-term financial planning through the use of highly customized spreadsheets and highly customized budgeting. And I couldn’t be happier with the end result (no student loan debt!) of this hyperfocusing.

Now, when it comes to hyperfocusing I have a decision that I need to make. When I sit and think about what my next big hyperfocus might be there are two items that come zooming to the front of my mind. The first is improving my health and the second is completing a doctorate. I don’t list these as first and second because that is how I rank them; either of these two items could be the next big thing that I hyperfocus on. Below are some of my ideas on each of these items and since I listed health first and a doctorate second above, I’ll give my thoughts on the doctorate first and my health second.

First, completing a doctorate would allow me to accomplish my long-term academic goal. As a high school student, I thought that I would eventually go on to become a lawyer. During that process, I would have obviously needed to earn a juris doctorate and thus would have obtained a doctoral degree in that manner. As we already know, though, I ultimately didn’t go in the direction of being a lawyer. Instead, I earned a master’s degree and I’m in the process of completing a post-master’s certificate. Frankly, you can’t get many more education credentials than what I have right now… except for a doctorate.

And even with these various certificates and commendations, obtaining a doctorate is still a very real goal of mine and one that I think about somewhat frequently. Not only does a doctorate open up the possibility of becoming a full-time professor, but there is a unique air of certainty that comes from someone speaking as a doctor versus speaking as an “expert” in a field. And since most “experts” have doctorates anyway, enrolling in a program to obtain one wouldn’t be out of bounds for what I do in my work.

Second, I could hyperfocus on improving my health. Whether we like it or not, our health is that one thing that we can’t get away from in our lives. Of course when we do get away from it our lives typically aren’t as robust as they could be or they just downright don’t last as long as they should. For each of us, our health is that thing we see in the mirror each morning and that thing we are somewhat consumed with when engaging in and interacting with the outside world. Let’s be honest, folks. We live in a very superficial society where a person’s appearance matters. You can be a brilliant scientist on the verge of curing cancer, but if you’re fat or generally out of shape, the superficial American public doesn’t give a damn about you. That is, they don’t give a damn about you until you can do them some good by providing a cure for their sicknesses!

I am confident that once I am no longer hyperfocused on repaying my student loans, I’m absolutely going to focus on one of the two items above. It’s either going to be the full completion of a doctoral program or a sincere focus on improving my health. Stick around the blog for this Wednesday’s entry where I’ll let you know which of the two I’ve selected. See you then!