People always are curious about how we pay so much towards our student loans and travel as much as we do. We know that most people don’t want to talk about money but we feel that it’s important to be transparent about what we do and how we spend.

Hopefully, by seeing more of how we break down our finances it may help others fine-tune their budget and put more focus on paying student loans. Here is a detailed breakdown with actual number values so you can see just where our money is going.

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Our Loans

Since everyone's loans are different, it's important to note how many loans we had. Coming out of school we had over $160,000 of student loan debt.

We knew that amount of loans would be difficult to pay off but we had to make it a priority if we were going to get out of debt. After four years we paid off $180,000 in loan debt!

Monthly Payment

Paying off our loans meant a lot to us. When setting up our budget, we decided to make this category the main priority.

Our monthly payment was going to be very high but we knew that going into it. We decided we didn't care how high our payment was going to be as long as that meant we could pay off our loans very quickly.

Selecting Our Amount

We had a few options on what we wanted for our loan repayment option. We refinanced to a five-year loan term with a minimum payment of $3,100.

The long-term option would have lowered our monthly payment but raised our interest rate. The short term (which is exactly what we did) gave us a high monthly payment and the lowest interest rate.

For us, selecting the right amount was the first and probably most important decision we could make. We knew to pay off our loans as fast as we wanted, we needed to pick a more aggressive loan payment.

We wanted to feel like we were making a dent in our loans but not so beaten down that we couldn't afford other things. Since we love to travel we decided on a number that still ley that happen.

Considerations When Deciding On Your Amount

When deciding on your own loan payment options and budgeting, you have a lot of things to consider. The first thing to consider is when do you want to pay your loan off?

If you want to shorten your loan term from 30 years down to 15 years, that won't put as much pressure on you as shortening down to five years might. Make sure you consider what your ideal timeline is as well as what your worst-case scenario looks like if you can't make more than the minimum payment.

When considering your amount, make sure you look at the interest rate. Saving 1-2% on interest over 30 years gives you huge savings and makes refinancing worth it. Just remember, the best interest rate will come with the highest monthly payment.

How to Fit Your Loan Into Your Budget

When deciding on our budget and loan payment, we started with the loan payment. We decided how much we wanted to pay for our loan and then built our budget around that payment.

We think this gives you the most motivation to pay off your loans. This prioritizes your loans above everything else, which can be very hard when you have a very high loan amount as we did.

You can approach integrating your loan payment into your budget in any way you want. For us, prioritizing our loans meant building our budget around our loans.

Before we go over what we spend our money on its important to remember a few things about our income…

Our income is semi-consistent and more than we would make as permanent PT's

We sign 13-week contracts as traveling PT’s so there is always the chance we don’t make money for a couple of weeks. We feel that the flexibility and increased money we make is worth the risk of missing out on some paychecks. Plus we are pretty good at saving to make up for this. For instance, right now we are off for two and a half months to spend time with family and take some vacations. All of which we already budgeted for.

Working While Paying Off Student Loans

In the first two years that we worked, we took off only six weeks. We ended up taking off more time in the next two years while still really focusing on paying off our loans ASAP. We will be traveling more now that we have paid off our loans in 2019 but when we are on a contract we tend to have only a few extra days off.

To make it easier to look at we included a table below that breaks down our budget from 2016-2019. These were the four years we were paying off our student loans. We suggest focusing on the percentages rather than the total spending as that will help you with your own budgeting.

Our Spending For 2016-2019

*Original post for 2016-2017, updated for 2016-2019 on April 5, 2020, to include final numbers*

Our focus on our budget clearly reflects our main priority: Paying off our student loans. It may seem extreme but by putting almost half of our income to loans we were able to aggressively pay them off as soon as we possibly could. Of course, it's still important to save money for fun, hence why travel is our second biggest expense.