My primary goal this year is to pay off my student loans and finally become debt free.
As of today, I owe $7,539.90. I owe $5,204.07 (2.25%) to my Alberta Loan and $2,835.83 (4.75%) to my Canada Student Loan. I’ve mentioned this before, but to any new readers – I currently focus lump sum payments on my CSL because it has the lowest balance and the highest interest rate.
My default repayment schedule is $75/month to each loan.
So I did up this little chart on my spreadsheet to see what I need to do to get these suckers paid off by the end of the year. I’ve added interest but considered the total interest I would pay for the year if I didn’t pay off any of the balance rather then figuring out the interest owing after each payment made (much easier to figure out and I prefer to round up). For context, I have 10 monthly payments left and 21 pay periods left.
As of today, I owe $7,539.90. I owe $5,204.07 (2.25%) to my Alberta Loan and $2,835.83 (4.75%) to my Canada Student Loan. I’ve mentioned this before, but to any new readers – I currently focus lump sum payments on my CSL because it has the lowest balance and the highest interest rate.
My default repayment schedule is $75/month to each loan.
So I did up this little chart on my spreadsheet to see what I need to do to get these suckers paid off by the end of the year. I’ve added interest but considered the total interest I would pay for the year if I didn’t pay off any of the balance rather then figuring out the interest owing after each payment made (much easier to figure out and I prefer to round up). For context, I have 10 monthly payments left and 21 pay periods left.
It would make the most sense (to me) to pay an additional $240 to my Canada Student Loan until it is paid off, and then make that payment plus the $75 default payment to my Alberta Student Loan once the first is paid off. In my student loan plan of attack post, I thought I could get away with lump sum payments of $175 - but I now think I need this extra $65 bi-weekly to make it.
Does that make sense? I'm a missing anything? Is this doable?
I've looked four pay periods ahead (until the end of April) - and it looks like I can IF IF IF I stay away from my credit card and stick my variable spending allotments and don't go over.
You would have to be sure that this is your #1 priority. You might also want to find another OT project so you can have a bit of a life. When will you know about the April salary review?
ReplyDelete@ Mom - I'm sure there will bits more of OT in there - but I don't want to count on it. I should know at the latest by the end of March - crossing our fingers on that!
ReplyDeleteThe plan looks good. Here's a question though...what happens if you do go over and end up needing a credit card? Would you cut the payment back to the student loans?
ReplyDeleteThe plan can be great. The execution requires that life stay status quo for the remainder of the year. We both know life doesn't like doing that. Do you have a contingency plan you can meld in with this current one?
@ Finding my way to Debt Free!: If another emergency or some such thing comes up - I would put a hold on the extra payment that I plan on doing manually each pay day (the $75 is fixed).
ReplyDeleteHopefully things stay steady (except for the raise i'm expecting in April!)
You wrote:
ReplyDeleteI owe $5,204.07 (2.25%) to my Canada Student Loan and $2,835.83 (4.75%) to my Alberta Student Loan.
I think you transposed the Canada and Alberta ... 5.2k to AB and 2.8k to CSL according to your sidebars.
@ Anon - thanks for the catch!! You're right, I did. I'll fix it straight away :)
ReplyDeleteThis isn't related to today's post but you've mentioned before you're in Calgary so I thought I'd send a link of a grocery comparison that was published today:
ReplyDeletehttp://calgary.ctv.ca/servlet/an/local/CTVNews/20100309/CGY_grocery_basket_100309/20100309?hub=CalgaryHome