ScoreCard Research Kelly Russell - The Penny Hoarder

My name is Kelly Russell, and I have $92,670 in student loan debt.

It’s not as bad as it sounds, though. Last October, that number was $104,105. I also paid off the remainder of my $7,000 car loan in September.

We’ve all seen plenty of articles with titles like “How I Paid Off $20,000 in Student Loans in Two Years,” and these stories are worth celebrating. Paying off student loans is a huge accomplishment, no matter how big they are.

But while the average student loan debt is around $30,000, many of us have a much higher balance. Whether it’s from attending a private university or deciding to pursue graduate school, paying off a six-figure student loan means playing in a whole other league -- especially when that loan doesn’t result in a six-figure salary.

If you’re facing a massive negative number, know that you’re not alone and you can pay off that balance before you hit retirement age. Here’s how I’m working on paying off my student loans -- without making a huge salary or working two jobs.

How I Racked Up More Than $100,000 in Debt

I graduated from a small private college in 2011 with about $35,000 in student loans. I went straight into grad school, and my lender deferred my loans. Since I didn’t have to make regular payments during the three years I worked part-time toward my master’s degree, I didn’t -- and it was the biggest mistake I ever made.

I was always fully aware of my loans and the amount of interest that was accruing on them. But for some reason, I wanted to pay off a big chunk of my loans all at once. This sounds great, but in reality, it meant that while I was building up that extra money in my savings account, my loan balances were growing even faster due to interest -- which, for most of them, is 6.8%.

In my defense, I did pay almost $15,000 upfront while I was in grad school for various expenses, including tuition, parking passes and those vague student activity fees. It didn’t directly add to my loan balance, but it did mean I couldn’t put that money toward paying off the loans -- so the balance kept on growing.

Chipping Away at My Debt

Last fall, I awoke from my delusion of paying it all off at once and decided to get serious about paying off my debt. In September, I paid off the remaining $7,000 on my car loan so I could focus solely on my student debt.  

In October, I put $6,000 toward my student loans. In the following months, November through April, I paid an average of $1,400 a month toward my student loans. In seven months, I knocked $14,400 off my student loans. If you include my car loan, I paid off $21,400 of debt between September 2014 and April 2015.

However, if you look at my total balance in October and now, you’ll notice that the difference is only $11,435. Why? Even as I’m paying down my loans, interest continues to accrue and add to the balance. It’s like taking 14,000 steps forward, then 3,000 steps back.

My Most Effective Debt-Reduction Strategy

Here’s the thing: I don’t earn a six-figure salary (not even close!) and I don’t work multiple jobs. I have my 9-to-5 job and occasionally do some freelance work on the side.

But I do have a secret savings weapon: I live at home. Yes, at the age of 21, I moved back in with my parents. I’m now 25, and I plan on staying put for at least another year. Drastic student loan balances call for desperate measures.

While I would love to live on my own or with a roommate, I’ve consciously prioritized paying off my student loans. Not only does living at home let me avoid paying Massachusetts rent costs, but I also do not have to pay for food or utilities. And instead, all of that money can go straight toward my loans.

This might not be an option for everyone, and I know how lucky I am that I’ve been able to move home. But if your family’s open to the idea, try it for at least a year. It might seem like a big sacrifice now, but it will be well worth it when you’ve paid off your loans in five or 10 years instead of 15 or 20.

Create a Budget and Prioritize Loan Payments

A budget helps you see exactly where your money is going. Take your monthly income and look at what it needs to cover -- the essentials -- plus what you’d like it to cover -- hobbies, socializing, etc. Look at what you absolutely must put toward your student loans each month, and then find ways to boost that amount by cutting down on other expenses.

Decide what expenses or nice-to-haves, like a cell phone plan or cable, you can cut from your budget to pay back more of your loan each month. While I splurge occasionally, I don’t spend a lot of money on shopping or going out to bars with friends. Instead of buying a new shirt I don’t really need, I put that money toward an extra loan payment each month.

Pick a Payment Method

Most people focus on paying off their loans in one of two ways. With the snowball method, you focus on paying down your smallest loans first. Each month, you pay the minimum amount on all your loans, except the smallest one -- you put as much money as possible toward this loan. Once you’re finished paying off the smallest loan, you move on to paying extra each month on the next smallest loan.

In contrast, the avalanche method involves putting more money each month toward the loan with the highest interest rate. It may take longer to pay off that loan because it may have a higher balance, but you’ll save more money overall by knocking down the total amount subject to the highest rate of compound interest. Once you’ve paid off the loan with the highest interest rate, you shift your focus to the loan with the second highest interest rate.

Other than living at home, my main strategy for paying down my debt is similar to the avalanche method. Each month, I make a little more than the minimum payment for each of my loans, and then I put larger sums toward my two loans with the highest interest rates -- . Coincidentally, these two loans also have the highest principal balances.

In addition, instead of making one big payment each month, I break the “loan payments” section of my budget into four amounts -- one payment for each week. This strategy helps keep my interest amounts a bit lower. Making payments more than once a month means less accrual of daily interest, so more of each payment goes toward the loan’s principal.

Paying off a six-figure student loan balance isn’t going to be easy, but I’m on my way. If you’re facing a similar amount of debt, I’d love to hear your strategies for paying it off!

Kelly Russell is a marketing professional with a goal of paying off her student loan debt in five years. She currently resides in Massachusetts.

If you’re hoping to increase your income over the long term, you may be considering going to grad school. This decision comes with many pros and cons, and grad school expenses vary greatly depending what school you go to, what region of the country it is in, what you choose to study and for how long.

There are the obvious upfront costs of tuition, textbooks, and room and board. But what about the not-so-obvious costs?

Here’s my story and how I learned -- the hard way -- about the price of furthering my education.

The Back Story

I majored in communications with a minor in marketing for my bachelor’s degree. After graduating in 2011, I decided to specialize in public relations and enrolled in Boston University’s graduate program. I was a part-time student who also worked full time, and it took me three years to complete my master’s degree.

Although I worked throughout college and lived at home after graduating to save money, I was unable to save much during those initial three years in grad school. For a while, I couldn’t figure out why.

Finally, I sat down and crunched the numbers. The problem is, going to grad school is expensive. (I know, that much is obvious, right?)

However, aside from tuition -- which added a whopping $65,000 onto my existing student loans from undergrad -- I paid almost $15,000 out of pocket for various expenses.

Here’s where I spent my money.


Because I had to drive to work every day and attend night classes two to three times a week, I had to pay for a parking pass for one of BU’s garages.

I paid $85 for a part-time pass every semester, which worked out to $595 over the course of three years. (I went for seven semesters because I took a summer course one year).

Student Activity Fees

I also paid $70 each semester for a vague “student activity fee,” supposedly to fund various events throughout the year. I never went to these events because after working 40-50 hours, sitting in class for six to nine hours, and spending countless hours tied up in driving, studying, homework and trying to see my family and friends, I never had the time.

Because I didn’t go to any of the student events, I tried multiple times to get out of paying this fee, to no avail. This came out to a total of $420 for six semesters, since you don’t pay in the summer.

Excess Tuition

The biggest out-of-pocket expense was tuition. The federal student loans I took out didn’t cover the full amount, so I had to pay $1,000 at the beginning of every semester for a grand total of $6,000.


I started a new job one semester and wasn’t sure what my workload would look like. Therefore, I decided to only take one class instead of my usual two.

It turns out this meant my student status technically became “less than part-time,” so I no longer qualified for the federal student loan. My options were to either take out a private loan with sky-high interest rates, or to pay for the entire class upfront. I ended up dipping into my savings account to pay for the $5,500 class.

To graduate on time and make up for the semester I only took one class, I took an accelerated six-week summer course a year later. That class cost $2,400. By that time, I had built up my savings again and once more paid for a course out of pocket. I paid $7,900 for these two classes.

In total, I paid $14,915 out-of-pocket during the three years I was in grad school. These expenses hindered me from being able to make more payments toward my already-existing undergraduate loans -- causing them to balloon into the six-figure balance I’m still working on paying down.

Had I known about the additional costs up front, I’m not sure I would have gone through with grad school. However, I do believe it was a worthy investment and will be beneficial in the long term.

That is, of course, once I finish paying off the remaining mountain of student debt!

Your Turn: Are you thinking of going to grad school? If you did go, do you regret the decision?

Kelly Russell is a marketing professional with a goal of saving more and paying off her six-figure student loan debt in five years. She currently resides in Massachusetts.

Since I started getting serious about paying off my student loans, I’ve been taking a hard look at my spending habits to figure out how to cut down on my costs.

One area I’ve hit hard is beauty. Through a combination of strategies, I’ve been able to save approximately $2,400 over the past two years on my beauty routine. I would much rather save that money for other things (future new home, I’m looking at you)!

Here are the tactics I’ve used to slash my beauty and personal care spending. How much could they help you save?

Save Money on Hair Care

I used to spend around $150 every six months to get my hair cut and highlighted, and $100 every three months for highlights only. This worked out to be about $500 a year. I now go to a friend of mine who gives me a great discount, so I pay about $180 a year. That’s a savings of $640 over the course of two years.

For those of you rockin’ the bangs, some hairdressers will trim them for free in between your regular cuts. It never hurts to ask -- but don’t forget to leave them a tip!

While not everyone knows someone who can give them a discount on hair care, it’s worth asking around. Check with friends, local Facebook groups, Yelp or even local beauty schools for potential options.

If you can’t find a hairdresser who can give you a good price, try saying good-bye to coloring your hair. Reuniting with your natural hair color for a little while will revitalize your hair -- and your wallet.

Save Money on Nail Care

I rarely went for manicures and pedicures before I cracked down on my spending, but I’ve now given them up almost completely.

Sure, the massage with the hot stones feels good on your legs when you get a pedicure, and it’s nice that they cut your cuticles and all, but you can do all of this yourself! Why spend $50 or more on a manicure and pedicure when you could spend $10 on some nail polish that will last you months, if not years? Plus, recent reports suggest there’s a much higher cost to that “cheap” mani-pedi than the price you’re paying.

Save Money on Makeup

I know a lot of people are 100% loyal to specific brands or products. I’ll be upfront: I am not one of those people. I don’t know much about makeup (can someone please explain contouring to me?), but I do prefer certain brands.

However, my loyalty will definitely waver if I come across a similar product that is much cheaper. Tons of drug-store brands do just as good a job as higher-end products; you just have to find the ones that work for you! These beauty-focused YouTube channels can help you learn which ones are worth checking out.

You can also get your generic beauty items, like cotton balls or makeup remover pads, at a dollar store for the biggest savings.

Don’t Waste Beauty Products

I used to use far too much product, especially shampoo and conditioner. I’ve realized that a quarter-sized amount of shampoo is usually enough, as you only really need enough to get at your roots. Conditioner is a different story; my hair is rather long, so I always use more conditioner than shampoo. However, I still try to use as little as possible to begin with, and then I can squeeze more out of the tube if I need it.

The same goes with other products like face wash, hair spray, nail polish remover, ointments, moisturizers, creams and more. Be cognizant of how much you are using each time, and you may start seeing that your products last much longer!

At the end of the day, you don’t have to give up all your favorite products and services to help your beauty budget.  Instead of completely shutting down your beauty spending, cut back on one or two expenses.

If you have your heart set on getting your nails done regularly, do it! Don’t deprive yourself to the point where you feel frustrated or resentful of your budget, as that’s just going to tempt you to blow it on a Sephora binge.

Your Turn: How do you save money on your beauty routines?

Kelly Russell is a marketing professional with a goal of saving more and paying off her six-figure student loan debt in five years. She resides in Massachusetts.