Featured,  Finance

How I Paid Off over $65K in Student Loans

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Melody Johnson Financial Coach

I never understand how life worked, until I received my first student loan bill. At 22, I was broke, without a job, and slapped with a degree that had little potential for earning money. Getting a job sounded easy, like standing in line waiting for your turn at the checkout. I feel so silly typing this now, but I now realize how naive I truly was. I was over $65,000 in debt and without a hope and a prayer of getting out of it.

I was over $65,000 in debt and without a hope and a prayer of getting out of it. Click To Tweet

Melody Johnson Faily

My Background

So how did I get here? I was raised with strong women in my family, including my mom who worked tireless hours in her work in order to afford a better life than she had. My grandparents came from the Philippines and my grandmother on my father’s side came from Mexico in search of a better life. My parents worked their way up from a small house in National City, San Diego into a three-bedroom home in a middle-class neighborhood. We called our first house the “Shack” because it was a one-bedroom, one bath house seated in a poor neighborhood. Our car was broken into multiple times. I grew up in a concrete jungle. So while my parents grew up in a poor community, I reaped the benefits of their hard work. My parents eventually earned enough money to put me and my sister into dance school, go to a private school (even if it was a not-so-nice area), and go to the zoo every once in a while. I was fortunate.

Melody Johnson paid of 65k in debt

My Degree

I was the first person in my family to get a college degree. My parents were supportive of me growing up. At one point in time, I would call myself the favorite of the family. I paid attention in school, got good grades, and had what I thought at the time, my whole life figured out. Boy, was I wrong. I had always loved self-expression and Theater was something that helped me cope with my social anxiety and depression. It gave me a chance to speak out in the world, and I felt strongly that I wanted to help others find their voice too.

So I applied to a small private school in one of the most expensive cities in California and thought nothing of it, because I figured everyone had loans and it was okay. Click To Tweet

Well, I got into school and I signed up for loans. I was already deep in debt and had not realized what I had gotten into. Of course, my degree in Theater Arts would pay for itself, or so I thought.


Melody Johnson Financial coach

My Career 

I’ve always considered myself a hard worker, so I was surprised when nobody called me when they saw my impressive resume with zero real-world experience. I landed a summer job after I graduated helping kids a summer camp in Big Bear. It was beautiful but really didn’t pay me enough money. I was devasted because the bills started to roll in and the money really wasn’t. At the time, I met my husband (boyfriend at the time) who encouraged me to reconsider pursuing Theater as a career. I felt like he had poured ice cold water over me in the middle of winter. I was angry at him, at the world because I was broke and nobody could help me. I was stuck in a rut without knowing where to go. Well, at least I thought.

Related: How to Pay off Your Student Loans Faster

I decided to go back to school to study early childhood education and moved back to Orange County with five other girls. My aunt helped me pull together money for the first month’s rent. I need to repay her for her kindness. I didn’t even have a car because I couldn’t afford one. I lived literally on rice and beans and still could barely pay the minimum payment. I rode my bike to work every day, by the way, I learned how to bike that same year because I never learned before. I eventually landed a preschool job teaching full time and I was finally able to make my minimum payment. But the interest was killing me. I felt overwhelmed most of the time and still felt like I wasn’t getting anywhere.

Marriage & Moving

Melody Johnson on a vacation

I got married and moved to Michigan to save money, live closer to Pete’s family, and pursue a new teaching opportunity. To put this in perspective.

I was paying $420 plus utilities for rent and my student loans were $365 a month. Click To Tweet

My income was between $1,000 – $1,200 a month. I had just gotten used to the idea of paying my student loans and bills on time. I had finally saved $1,000. I felt like I was on top of the world, but I was still only scraping by! That year I signed up for teaching elementary school through a program called Teach for America. I knew it would be hard work, but I thought I would be okay. My husband went to get his Master’s and we financed our first home.

Related: How to Qualify For Student Loan Forgiveness

I overworked myself trying to pay extra money towards the loans while I worked as a teacher in an inner-city school. It was rewarding but emotionally exhausting. I found a new job as a Loan Processor at a big mortgage company in Detroit. Feel free to guess which one. All the while, my husband went to graduate school and we cash flowed his entire program on my salary. I funneled every single extra dollar we had towards my loans, and over the course of two and a half years, we paid it off! We took a trip to visit Europe for the first time to celebrate and I decided I wanted to help others accomplish the same goal and live life the way they wanted to.

I funneled every single extra dollar we had towards my loans, and over the course of two and a half years, we paid it off! Click To Tweet

We paid off $72500

How To Payoff Your Loans Early

In this next section, I’m going to share with you how I paid off my student loans. Now, personal finances are personal, meaning that they are customized to you and what you value. While this is my recommendation, I would encourage you to really think about what you want your life to look like before you put pen to paper.

Don’t forget, I have a free 5-day email course that helps you with exactly this process.

Money Master's Challenge

Write It Down

Write down a list of all of your student loans including balance, interest rate, and the type of loan such as (private, subsidized, unsubsidized, etc.). Writing it down will certainly help you see truly how much money you are paying towards your student loans and how much is going towards interest each month. 

Separate your loans individually
If you have a group of loans that are under (Dept. of Education ) like mine, you’ll want to call the organization (My loans were serviced through Navient, previously SallieMae) that is collecting these bills to separate your loans individually. 


I used the debt snowball approach, but there are plenty of other ways to do this. I put my the most amount of money towards the lowest balance and paid the minimum amount towards all of the remaining student loans until I paid off the first loan. Let me show you some numbers. If your minimum payment is $800 and Loan A minimum payment is $80, Loan B’s minimum payment is $48, Loan C’s minimum payment is $137, etc. look at the lowest balance and put more money towards that loan. Let’s say that Loan A’s minimum payment is $80, but the balance is $1,600, you can adjust the payment to be $180 if you have an extra $180 and make the remaining minimum payments equate to $800 in total. This way you aren’t paying over the minimum payment amount (if you can’t afford it).

Related: How to Payoff Credit Card Debt Faster

eNROLL IN automatic debit

Most servicing agencies will provide a small percentage discount of fees if you enroll in automatic debits and make a certain amount of on-time payments. Of course, if you don’t have a savings account set up, that will be the first step in sustaining and meeting your financial goals.

Why It’s Important

  1. You can get reimbursed for interest! If you file for your taxes and claim your student loan payments, a portion of interest will be returned to you via tax refund through the 1098-T.
  2. Did you know that over the life of a 25 year student loan with an interest rate of 6% and a balance of $5,000, you will actually pay over $4,665 in interest over the life of your loan?!! That’s nearly double the principal amount with interest! Calculate your student debt calculator here.
  3. Did you know that if you defer or have your student loans in forbearance that the interest is still accruing? That basically means that the loan servicing company is still charging you money on top of your principal “original” amount borrowed. Yikes!
  4. Most private student loans are not even dischargeable through bankruptcy. See Forbes article here.
  5. Your high balance student loan could impact your eligibility to purchase a home or take out additional debt. See the article here.

Besides the reasons above, I also want you to consider how paying on these student loans impacts your mental, emotional, and spiritual health.

How I paid off my student loans and how you can too


Constantly worrying about your finances can take a toll on the way you communicate with loved ones and also the way you perceive the ability to run and design your own life. If you are a person or woman of faith, I would encourage you to pray and think about how much you are loved by all around you and consider what small baby steps you need to take when moving forward in your financial goals.

Please feel free to comment below about what your financial goals are and in what ways you are going to commit to paying back your loans and live your designed life!