Loans! Why Loans?

NOVEMBER 15, 2010; the date that we have all been dreading. The grace period for Sallie Mae Student Loans has ended and now is the time to pay back all of the money we owe. If you are like Julia and I you had to take out loans in order to pay for college and now that they are due back you have no idea what is the best way to pay them off. Here is a top ten list for information on how to pay back your loans.

1) Pray! Ask God for wisdom and guidance during this process. One of the many names for God in the Old Testament is Jehovah Jireh which means the God who provides. God will help you through this, ask Him for wisdom and guidance.

2) Go and find your diploma, serious, go and find it. Look at it and take a deep breath, you are a college graduate. Going to college was a good thing, do NOT regret it. You are better off for having gone.

3) Lay out all of the papers you have received from Sallie Mae. Figure out how much the minimum payment will be each month for the loan. Also, figure out how long you will be paying back your loan. Do NOT worry if it is a lot or a long time, remember God will provide.

4) Create a budget in order to make sure that you will be able to make minimum payments each month. Julia and I use a simple Excel spreadsheet as well as Mint.com, both of these are extremly useful. You need to know where your money is going, you work too hard for your money to spend it on NOTHING!

5) Call Sallie Mae and ask them to send you every month an amerization score, this allows you to know how much of your payment is going to the interest and how much is going to the principal. This is VERY important to know.

6) Call Sallie Mae and ask them if you pay anything extra if they will apply that payment to the principal only. (The principal is how much your actual loan is.) You want all EXTRA money to go to the principal in order to pay off the loan quicker.

7) If you have multiple loans take all of your extra money and apply it to the lowest loan amount, while staying current on your other payments. This will build steam and will allow you to pay off your loans quicker.

8) BE CREATIVE! I know most of you have read "extra" money and you may be thinking what "extra" money, all of my money goes somewhere. Here is where you need to be creative or work harder. Any money that you get whether that be a birthday check, christmas money, IRS refund, put that money to your loans (make sure though the money goes to the PRINCIPAL ONLY and not the interest). For example Julia and I both watch one year olds on Sunday night for "extra" money to pay back loans. I took another cleaning job in order to have "extra" money and I baby-sit on Fridays. All of this has provided "extra" money in order to pay off loans quicker.

9) It will be hard! I have learned that anything in life worth doing is usually hard. Work hard, trust God and He will provide. Dave Ramsey says, "live like noone else now so that one day you can live like noone else." Look to the future when one day you will be away from the bondage of loans. Remember Proverbs says the borrower is slave to the loaner. Pay off the loaner so you no longer need to be a slave.

10) Pray! We end where we start, pray! Give it all to God, I know that I get worried, I stay up half the night worring that Julia and I will end up on the street. Trust God! Give it to Him and He will provide, He is a good God!

One day we will go from the sad baby to the win baby.