Yahoo Finance | September 5, 2012
Whether or not to pay off student loans quickly is a question many recent college graduates wonder about. Between balancing retirement accounts, other debt payments, and having a life, many young people are stretched thin. But the stress of student loan debt causes many to put extra cash toward their payments.
From the article:
Feeling trapped under a mountain of student loan debt?
Joe Mihalic did. So a year ago, the 29-year old Harvard Business School graduate aimed to wipe out his $90,000 debt. He was earning just over $100,000 as a product line manager at a technology company in Austin, Texas, but was spending too much. He stopped eating out, rented two rooms in his house, sold his motorcycle and cashed out a retirement account. He paid off his loan in just seven months.
GET A ROOMMATE: If you don’t own a home, renting a place with a roommate will help keep housing costs down, says Lauren Lyons Cole, a certified financial planner.
Mihalic rented out two rooms in the three-bedroom house he owns. He hated losing his privacy, but says it was an easy way to bring in more money.
Mihalic has no regrets about the sacrifices he made during the seven months. He’s now replenishing his retirement accounts and continues to cut costs. But he’s not getting any more roommates. The last one moved out in August.
No longer burdened by student loans, Mihalic plans to use the extra money to start a business one day, or take time off work and travel.
If you don’t own a home, renting a place with a roommate will help keep housing costs down, says Lauren Lyons Cole, a certified financial planner.