How to Pay Off your Student Loans, from Someone who Vanquished $100k in Credit Card Debt

Your debt doesn’t have to control your life

Cat Bradley
Nov 6 · 7 min read
Photo by Alice Pasqual on Unsplash

Millennials dealing with student debt came of age during the great recession. High divorce rates led to lower household incomes. A bad economy resulted in record number job losses. The housing bubble popped and some of our families lost their homes. We wanted to make sure that never happened to us, so we went to college. But rising tuition and college expenses led to the biggest student debt crisis that this country has ever seen.

Now that most millennials are post grad, the economy is seeing the realities of that debt. Statistics show that millennials have lower income and fewer assets than previous generations. As more members of this generation put their life on hold — waiting to buy homes, get married, start families, or start businesses — the concept of the American Dream grows further and further out of reach. CNBC reports that housing prices in the U.S. are projected to rise at twice the rate of inflation and incomes, making it even more unrealistic for an entire generation to purchase those homes in the future.


The sad truth is that student debt is a $140 billion-a-year industry with the lobbyists in Washington to prove it. Debt handlers like FedLoan Servicing hire ex-lobbyists to run their federal relations, ensuring that their position in Washington remains strong. This relationship began in 1965, when the Federal Family Education Loan Program was signed into law. It was theoretically designed to make it easier for everyone to access a higher education, but unfortunately opened the door for private debt handlers to step in and make a profit on students. Since 1978, tuition prices have increased by 1,375% , as has the profit from agencies like FedLoan.

But it’s not just debt handlers. Flatly put: “The federal loans issued between 2007 and 2012 currently are projected to generate $66 billion in income for the government.

It’s fair to say that the student debt issue ranks as a national crisis. So why aren’t we handling it like one?


Student debt doesn’t only negatively impact our economy, but also contributes to our national rate of depression. If you’re reading this, you are likely impacted by student debt in some way. It’s important to recognize that there’s hope.

The biggest reason that student debt can be so mentally debilitating is that it keeps you from building your future, because you’re so focused on your past.

A few days ago, I was in a meeting with a client, Isabel Varela. She’s a public speaker with an incredibly inspirational story. After dealing with a fashion addiction, she found herself in over $100,000 of credit card debt. She turned her life around through hard work, got out of debt, and now does public speaking to help people come out of their addictions and unhealthy habits to achieve true happiness. While credit card debt and student loan debt are very different, Isabel’s story has a lot of important lessons for anyone struggling to build their financial future.

Photo by Ryan Born on Unsplash

Here’s what she had to say about getting out of debt:

Realize Why You Got Into Debt in the First Place

Dig deep and figure out what you need to do to keep your focus. Build a strong idea of what your priorities are, and then build your student loan debt payoff strategy into those priorities.

Surround Yourself with the Right People

Here’s an example of what this can look like in real life. I know a group of friends, each with graduate degrees, who started a brunch club. They wanted to connect with their community, but didn’t have the extra cash to spend on weekly outings. Instead, they began a potluck style weekly brunch, rotating throughout the group who would host each week. It was an easy way to connect with community, save money, and have a great time on weekends.

While it’s great that they’re saving money, what’s more important is that they’re building a community of people who are striving to accomplish a similar goal together. They help each other to make better decisions, support each other, and share strategies on debt payoff. They’re reaching their goal faster because they’re doing it together.

Start Small and Be Consistent

Isabel paid off her debt using a method similar to the snowball method. She began making monthly payments at $200 a month. Then, she reduced her other expenses and picked up extra income as she could. She started slow, making one extra custom piece a month. Then, over time, she added more.

She soon doubled her monthly payments. Then $400 became $800. $800 became $1,000. Consistency was key, because she needed to learn to create more balance in her life, ensuring that she wouldn’t go back to unhealthy spending habits. While student debt is a different kind of debt, the payoff method can be similar.

Build a Life, Not Just a Debt Payoff Method

She stressed the importance of learning about yourself and what will make you truly happy. Because at the end of the day, if you’re unhappy and living a life that makes you miserable, you’re more likely to build unhealthy habits that provide short term happiness, instead of continuing to strive towards long-term happiness.

For me, that means keeping my gym membership, but deleting shopping apps off my phone. Working out makes me feel powerful, and ultimately buying new things makes me feel guilty. Identifying priorities helps to navigate those decisions.

The Side Hustle isn’t the Goal

Here’s what Isabel suggests instead: “You need passive income. If I didn’t have passive income, I wouldn’t have been able to pay off the debt.”

Isabel has her apartment listed on airbnb. She rents out her own bedroom, regularly coming up with creative ways to use her home as a shared living space. “It’s a great return for the effort I’m putting in,” she tells me, “I’m making an extra $1,500 a month just from that.” Her apartment is listed for less than $75 a night, with an up charge of $30 for each extra person. This is important because Isabel started with exactly what she had. She didn’t invest a lot of extra cash into getting a newer, nicer apartment. She just did it.

While giving up your privacy for the chance to make a passive income stream might not seem ideal, there are plenty of ways to create passive income for yourself. If you want to build a side hustle on top of that, you’re starting from an even stronger place.

I can’t tell you what your passive income stream should be because it really depends on you, but here’s what you can look out for:

  • It should be something you already have the tools for and are great at.
  • It should be something that will make you at least $1,000 a month or $100/hour.
  • It shouldn’t take up more than 20 hours of your time a month.

Isabelle’s side hustle checks off all 3.


Managing student debt can feel impossible, especially when you’re in over $50,000. And it’s not just a personal issue anymore, as several 2020 presidential hopefuls have added the elimination of student debt to their campaign platforms. Wiping away student debt has the potential to greatly boost the U.S. economy, and the more of an issue it becomes, the more likely it is to happen.

Until then, getting your head around how you can grow your assets and manage your debt while still having a healthy, productive life is incredibly important. But we’ve gotten to the point where this is a shared problem–and where there’s shared human experience, there are solutions.

The Post-Grad Survival Guide

We're confused twenty-somethings. We dish on our post-grad blues, successes, failures, and everyday life right here. Featuring topics related to work, relationships, travel, finances, and so much more.

Cat Bradley

Written by

Building power for women in entrepreneurship. Consistency makes an impact. Founder at SewEthico, SewEthico.com

The Post-Grad Survival Guide

We're confused twenty-somethings. We dish on our post-grad blues, successes, failures, and everyday life right here. Featuring topics related to work, relationships, travel, finances, and so much more.

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