This Woman Had $60,000 in Student Loans. Here’s How She’s Saving $15K

Student loan refinancing
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“There’s nothing terribly unique about my story,” Caitlin Harren assured me when I asked about her experience paying back student loans.

She’s one of millions of former college students contributing to our country’s more than $1 trillion in student loan debt.

She’s probably right: She’s not alone.

But what is unique about Harren is her apparent financial literacy.

I don’t think she realizes how ahead of the curve she is in understanding the debt she took on and how it affects her financial future.

Funding Graduate School

Professionally, Harren is Amazon’s senior product manager in sustainability operations in Seattle. She’s helping the online retail giant reduce waste and increase efficiency in its packaging and shipping practices.

After five years working in the nonprofit sector, Harren wanted to move her environmental sustainability work into a more corporate environment. To do so, she went on to grad school.

An upstate New York native, Harren says she was fortunate enough to graduate from Smith College debt-free 10 years ago. Her parents funded her Bachelor of Arts in Environmental Science, and she took her skills to nonprofits after college, including The Sierra Club.

By the time she was ready to go back to school, her resources were relatively depleted. Five years working for nonprofits and living in the San Francisco Bay Area hadn’t been a boon to her savings.

This time, she applied for federal student loans and headed to the Erb Institute for Global Sustainable Enterprise at the University of Michigan.

Three years later, Harren returned to the West Coast armed with a dual M.S./MBA… and about $60,000 in debt.

This is where her “basic” understanding of personal finance kicks in — and where we can learn from her.

Many of us with student loan debt of that magnitude are simply drowning in it. We make minimum payments, defer payments, accrue interest, struggle each month and ultimately make little progress.

Maybe once things are completely out of control, we finally seek a better solution.

Harren knew she needed to address her student loan debt head-on from the start, and she found a smart solution.

When she graduated in 2013, federal interest rates were hovering around 6.8%, she recalls.

“I think that’s completely inappropriate,” she said. “I would have taken any lower rate.”

Finding a Fun Way to Refinance

Through other grads on Facebook, Harren heard about a then-new refinancing marketplace — SoFi.

The community aspect of the startup appealed to Harren — as did the opportunity to drastically reduce her student loan bill with a lower interest rate.

SoFi offers student loan refinancing and other financial services aimed at young professionals. It’s committed to a different approach from what you’d get with a bank.

When Harren found the company, she was attracted to its alumni-funded model, where students and recent grads would receive school-specific student loan funds from alumni and institutional investors.

Harren liked that she’d be sharing funds with people who also shared her experience.

Since SoFi’s financial offerings have expanded, it’s no longer alumni-funded, but has turned its focus to lending to — and supporting — financially responsible individuals.

Now it uses forward-looking factors like education, career experience and free cash flow to determine your loan eligibility, rather than relying on your FICO score.

And SoFi goes beyond loans in its commitment to empowering members to accomplish career and life goals.

The company also offers Career Strategy services, providing career planning and job search assistance to help members grow professionally and earn more money.

SoFi even offers fun, educational opportunities and local events that connect the SoFi community, like happy hours, community dinners and — I’m not kidding — skydiving.

How Much Money Can You Save with SoFi?

So it sounds fun, but how much money does SoFi actually save grads?

Remember Harren’s 6.8% interest on those federal loans? Refinancing with SoFi cut it down to 2.5%.

That’s a variable interest rate, which means it can rise over time. But it will likely be a while before Harren’s interest hits its original astronomical rate, so she can enjoy years of savings.

With the remaining $48,700 in loans she refinanced with SoFi, Harren estimates she’ll save between $11,000 to $15,000 over the 10-year life of her loans.

How to Pay Down Student Loan Debt Faster

In addition to refinancing early, Harren is making some other smart moves to pay down her student loan debt inside of 10 years.

Instead of the minimum $430 payment each month, she’s paying about $650 to stay ahead.

She said she could have been more aggressive and even paid off all of her debt by now, but she’s opted to put some of her extra money into high-yield savings each month instead — something she wouldn’t have been able to do easily under her original repayment plan.

She also took advantage of an opportunity to pay down a big chunk of her loans when she had it.

When Amazon hired her three years ago, she got a relocation stipend, which she was able to put toward her debt before refinancing. She moved to Seattle with just two suitcases and bought her flight with travel rewards — quite the Penny Hoarder!

With the money she can save each month, Harren wisely keeps a stock of “short– to mid-term savings.”

The bulk of that savings went to the down payment on a house last spring, and now she’s working back up to an emergency fund of six (or more) months’ expenses.

Is Refinancing With SoFi Right for You?

Harren was smart to look into refinancing early after graduation to secure a dramatically-reduced interest rate.

Even if you’ve been out of school and working on paying down your student loan debt for a few years, refinancing could still help you save money.

In addition to a lower interest rate, refinancing could mean a lower monthly payment and, like Harren’s, thousands of dollars saved over the life of your loans.

If you’re struggling to keep up with monthly payments, or you’re buried in interest and feel like you’re making no progress, refinancing with SoFi could offer some relief.

What would you do with an extra $15,000 in the next 10 years?

Your Turn: Have you considered refinancing to pay down student loan debt?

Sponsorship Disclosure: A huge thanks to SoFi for working with us to bring you this content. It’s rare that we have the opportunity to share something so awesome and get paid for it!

Licensed by the Department of Business Oversight under the California Finance Lender Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS # 1121636. (

Dana Sitar (@danasitar) is a staff writer at The Penny Hoarder. She’s written for Huffington Post,, Writer’s Digest and more, attempting humor wherever it’s allowed (and sometimes where it’s not).