So one night back in August I decided to calculate how much we’ve paid toward our student loans so far because it had been exactly a year since we started paying. This wasn’t an easy task because just looking at the current balances and comparing them with the starting balances does not tell you how much you’ve paid. In fact, that’s what prompted me to calculate how much we’ve actually paid; I thought “wow, it seems like the balance hasn’t gone down much and it feels like we’ve paid more than this.” Spoiler alert: we had.
Long story short, I made a Google Sheet (because of course I did) to list each payment made and compare balances to payments, etc. What I found was pretty maddening (whichever definition of that word you’re thinking – you are right). Since a couple months have passed since August, I’m going to plug in our current numbers for this post. The total we’ve paid on student loans in 14 months is: *can I get a drumroll please*
THAT is something to be proud of. Over $15,000 in just over a year amounts to about a third of our total take-home pay for that time period. You’d think paying that much in one year would make a nice dent in our total combined $108,000 student loan debt, right?
Guess how much our total balance has gone down?
That’s $5,216.62 (yes, the 62 cents matters!) that feels like it doesn’t even count. About a third of the money we have paid is just gone. That’s how it feels, at least; it’s invisible because it went to interest and so our loan balance doesn’t reflect that 5K that has been paid. Instead of a balance of $92,400, our total balance is $97,700. I rejoiced when our balance went below the 100K mark, which is kind of depressing when you think about how much debt we have (I’ve said it before, this is MORE THAN OUR WHOLE HOUSE COST). And you might be thinking “yeah, yeah, that’s how it works, shouldn’t have borrowed that much, blah blah blah.” Or at least that’s how I picture some scolding baby boomer talking about how silly we millennials are (though I’ve never actually heard or seen anyone say things like that except from random commenters on Facebook articles. Going down the rabbit hole of reading comment sections is my guilty pleasure.). My response: Sure! But it still sucks!
Of course I felt the need to do these calculations right before bed (because who needs sleep when you’ve got crushing student loan debt, #amiright?). So I spent the next hour, when I should have been peacefully asleep, obsessing over the possibility of refinancing to get a lower interest rate. I’m still on the fence about that idea, but it’s on the table. Anyway, I hope this creates some solidarity for those of you who feel like you’re paying a lot of money and your balance just doesn’t seem to be reflecting that. That’s probably exactly what’s happening. Not really a comforting thought, but as they say, “the more you know.”
Maybe this just felt like me complaining. Well, it was, so… That’s just what we millennials do, you scolding baby boomer, you. 😆