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- When I graduated from college, I became a teacher with $20,000 in student-loan debt.
- Since I couldn't pay down my debt, I bought a house, flipped it, and then sold it.
- I used the money I made to pay off all of my student loans, and now I feel free.
Growing up in a family of 11, we had to watch our pennies. Being raised in these circumstances always made me appreciate the value of a dollar.
When I had to decide which college to attend to earn my bachelor's degree in education, I looked at everything based on dollars and cents. So, I did the sensible thing and attended a community college for my associate's degree first.
During those two years, I worked at a local gym while taking my classes. I was essentially able to pay off my courses as I took them. It's amazing how affordable community college can be, especially while living at home.
Once community college ended, I went on to a state university to keep costs down as well. Still, by the time I graduated with my bachelor's degree, I owed about $20,000 to Sallie Mae.
My first job in teaching didn't pay enough
There I was, completing my first two weeks as a teacher and finally seeing my paycheck. Yikes! To break it down, I was earning $750 every two weeks — or $1,500 a month. I made more money working part-time at the gym. Between rent, utilities, car insurance, and student loans, I was breaking even every month.
I knew if I kept paying only those minimum payments, it would take me 20 years to officially pay off the loan — but also with tens of thousands of dollars extra because of those pesky high-interest rates.
I wondered how I could pay back my student loans within a few years instead of decades, and I started brainstorming ways I could save money. I realized my rent and utilities were costing me about $1,000 a month. I thought I could do better.
At first, I started to look at cheaper apartments. But the ones that would save me a hundred or two every month were almost unlivable.
I then got the idea to buy a house
I've always been a big fan of HGTV. I watched most of the house-flipping shows and thought to myself that I could probably do something similar.
I started thinking outside the box.
I had very little money in the bank. There was a combined $1,500 in all my accounts. Still, I started looking at houses for sale. I came across a two-bedroom, two-bathroom house in Lake Thunderbird, Illinois, with a good yard and some privacy as it was surrounded by woods. It was listed at $120,000 but had been for sale for a year. No one had been living in it for at least six months. After negotiating and playing hardball, I bought it for $95,000 in 2010.
I only put down $1,500 and used private mortgage insurance.
I got to work flipping the house while I lived in it
The house had good bones. It had a decent layout and was about 1,100 square feet with a detached two-car garage. I didn't have to tear down walls, but I did have to do some sweat equity.
I stained the cabinets, changed out faucets, replaced countertops, painted all the walls, and replaced the flooring. I'm not the most handy of men, so I pulled in help from knowledgeable friends when needed.
I tackled each project one at a time as I was living there. My mortgage, including property taxes, was about $750 a month. As I essentially had no money to put down on the home loan, I was paying another $40 a month for the private mortgage insurance.
In three years, the house was immaculate. Could I have finished it quicker? Certainly. But while I was living there, I was teaching, too.
When all was said and done, I sold it for about $120,000. I'd paid the mortgage down to just under $85,000 by that point, so I left the sale with a good-sized check in my hands.
I immediately paid off all of my student loans
With the money from the sale, I brought my student-loan debt down to zero. Sallie Mae could no longer control me. Plus, I still had enough money left over to find another place to live.
Waking up each day and knowing I'm not in debt other than my current mortgage makes me almost giddy, especially considering where I came from. Plus, it wasn't too difficult to achieve.
By keeping an eye on ways to limit expenses for college and focusing on how much money is coming in and going out, many people can do what I did and pay back their loans faster.