Student loan interest is just around the corner, and as always, we’ve got your back! This won’t just be about your debt; it is for everyone trying to incorporate their student loan payments into their budget and financial goals. In this episode, let’s talk about all things student loans, debt, and prioritization to live an intentional and values-based spending life!
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Let’s discuss prioritization
The word “prioritization” may seem like a basic idea to understand, yet most of the time we struggle to implement it in our lives. Prioritization is deciding the level of importance or urgency of various items, goals, or tasks. In the books Jen loved, “The One Thing” by Gary Keller and “The Lazy Genius Way” by Kendra Adachi, they said to ask ourselves, “What can I do now to make something else easier or unnecessary later?” Everything in the world is fighting for our attention, but we don’t have the time or energy for everything. Some things might feel urgent, but what is actually of greatest urgency for you specifically?
Prioritization is going to help us identify what is of greatest value and importance. We often look at the big picture of our student debt and we think it’s way too much to try to pay off. When in reality it’s in sections. It can be different debts prioritized at different times and in different seasons. Likewise, Jill advises us to write down our goals and priorities in order to identify those we will want to pursue. The barrier we often face with prioritization is when we use our life circumstances and seasons as an excuse to not do it, because those are not excuses not to try or focus on for a time.
Discussion on Debt
Every microdecision we make everyday will have an impact on our financial goals. Jen follows a personal wellness trainer and influencer who said that we have told ourselves that there is good and bad food; that’s how we get into this diet-binge cycle, which is unhealthy. All food is neutral. Some have a higher nutritional density than others, and some don’t. That’s how we should also see debt. Some debt is beneficial, like our student loan, or it can be a weight around your neck because it is not doing enough for you. There’s no good or bad debt because it’s person-specific.
Jill personally doesn’t want to carry a lot of debt throughout her life, and we believe most of us do. Her goal is debt freedom, but it is important to take out the emotional and mental weight of it being a bad thing to do. It helps make informed and healthy decisions. One way to identify which debt you should pay first is by listing the types of interest on your debt. For instance, a simple 10-year interest loan of $25,000 with 3% interest has a total of $3,968.22 in total interest paid over the life of the loan, while 7% interest totals $9,832.54—that’s over doubled! We can’t control the interest we get, but all the more reason to pay off that debt with higher interest rates.
Now we Integrate
It’s an extreme way of life to think everything should be at the top of your priority list or be important. If everything is important, ask yourself, What’s the most important thing right now that’s going to make other things easier and more necessary in the future? Jen wants you to start small now to make saving easier later in your life. We are more easily able to say no to everything at once when we know we’ve got a plan. Consider your life stage and present circumstances, such as your age, relationship status, children, cost of living, etc. Evaluate your own mindset, emotions, behaviors, and values around money to help determine the path that’s right for you.
Just like in our personal lives, learn how to implement the concept of boundaries even in our finances. Give yourself permission to pivot like Jill, who took out more debt within her debt payoff journey, which she does not regret (paying off student loans and taking a minor private loan to purchase and renovate the RV). Our brains need shortcuts. Prioritizing is one of those shortcuts. When you do the work upfront, it’s easier later. Routines, habits, and motivation are other shortcuts that we’ll be talking about soon.
What was your most effective strategy in staying motivated and focused while paying off student loan debt?
Creating a challenge in her head is Jill’s way of staying motivated to pay off her student loan. She loved seeing the overall impact of challenging herself. Jen’s camaraderie and partnership with Travis greatly helped her stay focused, as did meeting other people on social media who shared the same goals as her.
Bill of The Week
Thank you Gaby for sharing your bill about getting an oil change ($2800 estimates for repairs)… speaking of priorities!! Well done getting a second opinion ($400 total). NOT URGENT AFTER ALL!
Thanks so Much for Listening!
Thanks so much for listening! Many of you know we have a private community where we do monthly money challenges and offer accountability groups. We want to congratulate one of our members for a big win:
Congrats! Thanks for listening and if you want to check out our monthly challenge community head to frugalfriendspodcast.com/club to see what challenge we have coming up next.
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