23-year-old with 23 X 3 in debt

[JFisher29]

Hello everyone,

I have read the Millionaire Fastlane and my entire worldview has shifted.

I am 23 years old and living in Minneapolis with around 70k in student debt. I currently work in corporate finance with a salary of 75k; this will never give me freedom. I am currently laying the seeds of thought for my future fastlane business so I can earn asymmetrically.

My question to all of you is this, how should I think about my debt? I have advice coming from every direction about how to handle my wealth. My dad loves Ramsey and says to throw everything at it and save as much as I can, the slowlane. I am making $800 monthly payments, and my minimum payment would be around $200. How should I balance my debt with wanting to save funds for entrepreneurial ventures? How much is a realistic amount to save for a first swing?

I believe that the entirety of our experiences and actions as people are downstream from our mindsets, so what mindset should I have about my debt? (Of course, practical tips would be appreciated too.)

Take care everyone,

J

 

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[MJ DeMarco]

If you were making $50K/mo, would you be asking this question? The fact is, you wouldn't.

I paid my student loans off in about 3 years. In 2 years and 364 days, I paid off about 20% of the balance by just making minimum payments. Then one day, on day 365, I paid off the rest with one big check. That's the power of having a bigger income.

Obviously the above is generalized, but the point is ... a big income fixes debt issues real fast.

Likewise, I owe about 17,000 in credit card debt. Am I worried?

Nope. It will be paid off in full by the end of the month.

A big income resolves debt, quick.

Or you can follow Dave Ramsey and have it paid off in 22 years.

 

[Kak]

Another case of Ramsey doing more harm than good.

The fact that you did it in the first place was a bad decision. To think you need 75k in student loans to get a 75k a year job is absurd.

Either way it’s already there.

I paid the minimum, made more money, and paid mine off with one last payment.

 

[JFisher29]

Another case of Ramsey doing more harm than good.

The fact that you did it in the first place was a bad decision. To think you need 75k in student loans to get a 75k a year job is absurd.

Either way it’s already there.

I paid the minimum, made more money, and paid mine off with one last payment.

It was a horrible decision. Pretty crazy what a college can get an 18 year old who is itching to leave home to agree to. Pretty ironic that my degree is in economics…It’s ok though, the past is the past.

 

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[MJ DeMarco]

It was a horrible decision. Pretty crazy what a college can get an 18 year old who is itching to leave home to agree to. Pretty ironic that my degree is in economics…It’s ok though, the past is the past.

Great attitude to look beyond it. That will serve you well in the future. Forward and onward...

 

[socaldude]

On the bright side you are making decent money in a Job.

At least your degree is earning some kind of ROI.

I worked at a car wash after college so that wasn’t fun. LOL.

I would make minimum payments and put the rest of the savings into an asset that earns income. Then pay off the loans with that income.

 

[MitchC]

The answer to this question needs to come from within you, and then you wouldn’t even be asking us.

Do you believe within yourself that you could better use that money to start a Fastlane business?

The people on this forum believe you can so they will tell you what to do based on that.

But that isn’t going to be enough to actually get you to stick to that advice and actually spend that money starting a business.

 

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[MitchC]

Another case of Ramsey doing more harm than good.

He’s kind of like the opposite of a guru

Take someone potentially great and inspire them to be mediocre

 

[REV5028]

For what it's worth ... I'm in a somewhat similar situation. My approach is currently to pay off debts aggressively (paying much more than minimum and also paying in weekly chunks to help reduce the effects of interest). As for having money for fastlane ventures, I'm starting smaller with projects that don't require a ton of money, still adhere to CENTS, still help ease my financial burden, still teach me about entrepreneurship, and still help me develop various skills. From there I will grow into bigger projects. For now I need my job, and even though it's a 9-to-5 I am starting to see opportunities that will possibly help me in entrepreneurship (networking, coding, seeing pain points, etc. etc.). Some may call this risky, but I actually don't contribute a whole lot to my 401K & IRA right now; to me, that money is better used right now to pay off debts because I fully intend on not working 9-to-5 for 30 more years to have a measly return on those kinds of investments. Remember, there are plenty of millionaires here that started a fruitful business with $1000 or less.