How I Paid Off My $20,000 Student Loan with a Poverty-Level Salary

In only 3 years, I achieved what seemed like an impossible goal.

Yael Wolfe
Nov 17 · 7 min read
Photo by Pang Yuhao on Unsplash

Not going to college wasn’t an option for me, my siblings, or my cousins. My grandfather was passionate about higher education — so passionate, in fact, that he set up college funds for each of his grandchildren after we were born so that we could go to school without accumulating debt.

Unfortunately, I wanted more than a bachelor’s degree — more than what my grandfather’s money could afford. I decided to pursue a master’s degree in teaching. At the time, the most affordable program I could find cost almost $30,000 — not counting books. It took me months to decide whether or not to take on that kind of debt, but eventually, I dove in. It felt like the right thing to do.

I’d be able to pay it off in a few years, right?

The Recession

Our professors told us it would be very unlikely that we would find jobs outside of subbing once we had graduated. A pall fell over our cohort — after 16 months of grueling work, night classes, and two sessions of unpaid, full-time student teaching, we no longer felt we had anything to celebrate.

Just as predicted, I ended up substitute teaching for years after I graduated. Though subbing pays fairly well, there are no benefits, and the work is not consistent. Month after month, I struggled to pay the bills, including my $170 student loan payment.

I felt like I was suffocating every time that loan bill arrived. I had thought I’d be free of it in 5–10 years, but with so little of my payments going to the principal, I calculated it would take closer to 20 years. (In fact, research shows that it takes the average person 21 years to pay off a student loan for a bachelor’s degree.)

That wasn’t, at all, what I had anticipated. I had dreams of finding a decent-paying job, getting rid of the student loan debt immediately, and buying a house. Before enrolling in graduate school, those dreams didn’t seem that far-fetched. But suddenly, they felt impossible to achieve.

By the time my relationship ended with all the financial mess that comes with a breakup, I left education entirely and started working at a nonprofit, where I made almost half of what I used to make as a teacher.

I was grateful for the steady work and for not having to substitute teach anymore. But I stopped believing I would ever get out of debt.

The Turn of the Tide

I became more and more determined to get myself out from under my student loan. It had been seven years since I’d taken out the loan and I still owed $20,000.

I didn’t know how I would do it. My take-home pay was $2,000 a month (an income that is just below the poverty level in my county) and in our ridiculously bloated housing market, I was living in a tiny duplex that cost $1,000 to rent. With all the other expenses I had, I was lucky to have $20 to spare at the end of the month.

I read articles constantly that claimed to enlighten readers with the secret of how to dissolve student loan debt. But none of them taught me a thing. I knew I had to rely on myself if I wanted to pay off that debt.

Here are my “secrets:”


Tracking Every Penny

However, I knew I had to start tracking my expenses and learning where I could cut back so I could make bigger payments on my loan each month. I had an old version of You Need a Budget software and began using that to track every penny — and I mean that literally. Nothing went by unrecorded.

I know from experience that this practice can sometimes feel magical, despite the anxiety it might initially cause. How can you explain that you have an extra $50 when your mental estimates put you behind by $75? Where did that money come from? The trick is, the more you start tracking your money, the harder it becomes to spend frivolously. And before you know it, you have a surplus at the end of the month.

Pinching Pennies

Thankfully, I’m a Cancer, which means being frugal comes naturally to me. But I really doubled down on this, putting off purchases and passing on my favorite expensive chocolate bars at the grocery store. Admittedly, I got into a bad habit of wearing pants until they were literally threadbare and avoiding coffee shop meetings with friends ($4 for a cup of tea seemed so expensive!).

But it was important to me to allow myself some fun — like keeping kombuchas in the fridge. Even as determined as I was, I knew that being too extreme might endanger my efforts in the long run.

Working on Financial Literacy

Despite my lack of confidence, I started taking free financial literacy classes offered by a local nonprofit. I started reading books on the subject. I even tried to talk about money more often with friends and loved ones. It’s such an important part of our lives, I realized, yet something I tended to ignore.

Always Overpay

Month after month, I put every last penny I had left over toward my loan payments. There were months when, incredibly, I was able to save $500 — all of it went toward the loan. Whenever I worked overtime, that money went to my loan. If I made extra money from my side hustles, it all went to the loan.

It didn’t take long to go from $20,000 to $10,000, and once I hit that number, I was filled with excitement. I knew I was going to make it.

The Final Payment

And yet, I did it. With only my poverty-level paycheck and the occasional hundred dollars I made from my side hustles.

It was one of the most liberating feelings I’ve ever experienced and I will never forget how proud I was to make that final transfer from my bank account.

There’s No Magic Formula

In the end, there’s really only one thing I did that got me where I wanted to be: I simply made the decision to do it. No excuses. No whining. No trying to find an exit strategy or dreaming about loan forgiveness.

I just had to do it. One penny at a time.

The Ascent

A community of storytellers documenting the journey to happiness & fulfillment.

Yael Wolfe

Written by

Sex positive, 40-something feminist. F*ck yes. {To see more of my work:}

The Ascent

A community of storytellers documenting the journey to happiness & fulfillment.

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