On Friday, I called up our student loan provider (the third company we've worked with in the eight and a half months since graduation, since they keep selling our loans) and paid off the last $1,793 of our debt.
We are now, officially, debt free!
At graduation, our student loans totaled $33,000, some in my name, some in Bart's, all happily subsidized (meaning they didn't start accruing interest until six months after graduation, rather than accruing interest from the moment the loans were issued at the beginning of the semester) .
The loans were all for a period of ten years, with a 6.8% interest rate, which was a much higher interest rate than either of us thought we'd have to pay for student loans.
If we had paid them off over the 10-year term of the loans, we would have paid not only our $33,000 in actual loans, but an additional $12,570 in interest. Instead, we paid less than $250 in interest in all because we paid off a large portion of the loans just before the grace period ended, and the rest within another three months.
We committed to paying off the loans as fast as we could the moment we started our full-time jobs 9 months ago, and that allowed us to make huge headway on them before the interest caught up with us.
Today, student loans are extremely common, and are viewed probably second only to mortgages on the "good-debt" spectrum. And I'm sure there are financial advisers who would have recommended we invest our $33K instead of paying our loans off right away.
"You could see a return of 10% or more on your money over those same ten years. That would cover the student loan interest and net you a return of 3%! How do you like THEM apples?"
And yet, somehow, we just weren't interested in doing that. I don't know if it's "the great recession," our parents' examples, the peace that comes from being debt free, the certainty of the interest we'd have to pay, the looming responsibility of new parenthood, or a combination of all of those things, but we just wanted to be done with our student loans and move on.
I'd take the financial surety of being debt-free over a possibility of a 3% return any day.