From $100K in Student Loans to Debt-Free in 28 Months

Sarah Reese
Apr 19, 2021

Their story

As an engineering student, Ruth had planned to work part-time throughout the school year as well as the summer to fund her education. Her goal was to complete her Master’s degree immediately upon graduating. She didn’t realize however, how little most jobs paid and how many hours she would have to work in addition to studying.

As her semesters got harder, her grades started to slip and she needed to quit her job to focus on studying. Like many graduates, Ruth had a hard time finding work in her field after school. She took a job in an office and tried to pay down her debts. Still wanting to pursue a Master’s program, she hoped that furthering her education would lead to more job opportunities and higher pay in the future, but knew it may mean taking on more loans to do so. 

Aaron and Ruth met through a mutual friend a few months after graduation. Aaron was working as a Lab Assistant and living downtown Minneapolis. They hit it off right away and after two years of dating, they were engaged. Quickly after announcing their engagement, the pair decided to move in together to save on rent costs. 

Looking at the math gave Ruth and Aaron a reality check

As they started to crunch the numbers for a wedding, they became overwhelmed and disheartened by the expenses. Even with a substantial contribution from Aaron’s parents, they would still be out of pocket more than $20,000.00.

Ruth started to feel overwhelmed by the math. She’d barely made a dent in her student loans over the last two years, and Aaron had over $60,000.00 left to pay towards his own loans. If they were to add the costs of a wedding on top of their debt, they would be looking at over $100,000.00. 

This figure was terrifying to Ruth, who still had plans to go back to school for that Master’s degree. She voiced her concerns to Aaron and luckily, he’d been thinking along the same lines. 

Advice from a financial planner

They decided to consult a family friend who used to work as a financial planner. It was easy for the financial planner to identify the critical mistakes the couple were making in managing their personal finances. 

Making a plan makes a difference

He created a plan for the couple to follow that would help them pay off their debt over the next two years and save towards a wedding. 

The snowball method

First, they used the snowball method to pay off their smallest debts and then started tackling the larger loans.


Income-driven repayment

With credit card debt out of the way and some of the highest interest rates eliminated, they were able to start paying down Aaron’s line of credit. Ruth looked into an income-driven loan repayment plan, and was able to get her monthly payment lowered. 

Small changes that add up

They moved to a smaller apartment, sold one of their cars, and were diligent about sticking to the budget the financial planner had created for them. Together they agreed that finishing Ruth’s education was more important than a fancy wedding. The fund that had once been for their dream wedding became Ruth’s going back to school account. Feeling driven to help his future wife accomplish her dream, Aaron asked for a raise at work and added all the extra income to their savings. "It wasn’t easy,"  he admits. 

"In fact, it was the hardest thing I’ve ever done. It felt like a lot of sacrifice, especially in the beginning. Not being able to go out for dinners, cancelling subscriptions, and making every dollar stretch made us feel resentful at times. Sometimes, during weak moments we would talk about going out and splurging. We'd both dream up an item that we really needed, and agree to go out and get it."

 Ruth says the guilt of sabotaging their hard work always stopped them before they could act on their impulses.


"In our hearts, we wanted to be successful together. I didn’t want to disappoint him and he didn’t want to let me down either so we never acted on our urges to spend outside of the budget. Sometimes unexpected expenses arose and we needed to adjust for car repairs and dental work, we couldn’t be wasting our hard earned cash on new sneakers! Seeing the financial planner was the smartest thing we did. He showed us how our minimum payments were doing nothing towards our debt repayment and the real cost of the accumulating interest. He also helped us look into other financial aid and refinancing options for going back to school that were really helpful."

The couple managed to clear their debts in 28 months, and Ruth was able to apply to her Master’s program with zero debt

She earned a scholarship and qualified for bursaries that lowered her tuition costs. She and Aaron worked while she was in school, and using the money they had saved for her education and a contribution from Aaron’s parents, she was able to complete her program without accumulating new debt.


After her Master's graduation, Ruth found a much higher paying job in her field. With what they had learned about saving and debt repayment, they were able to save enough for their dream wedding within one year.


"As much as it was stressful and really difficult at times, I’m glad we did what we did and learned to manage our money. Now, I never carry a balance on my credit card and if we ever need a loan again in the future, we’ll know how to do the math on repaying it."

Says Ruth about the whole experience. 


"I’m happy to know that we have started our future together on the right foot.

We’ll be able to save for our children’s futures so they don’t have to experience what we did but I’m still planning to teach them as much about financial literacy as possible. I hope people will learn from our story too.

Debt isn’t insurmountable, the way it may feel at times. But it does take a plan.

It won’t just pay itself off, and banks make money off your inability to pay it down.

So do research before you make decisions and make sure you know what you’re doing and stick to the plan. Otherwise, you could be in over your head before you even finish your education."