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In the USA, wedding wishes often include the line “for the richest or the poorest”, but many people do not take into account the amount of their partner’s debt before saying “I do”. College lovers LeVar Harris and Reanne Swafford-Harris, who married in 2015, were open to each other about their finances from the start, and they made another vow to put their quality first. life while focusing on repaying their significant debt.
As young professionals with graduate degrees, that meant getting off to a good start in paying off six-figure student debt and two mortgages.
In just five years, LeVar and Reanne have paid off around $ 250,000 in debt, including:
- Law School and Undergraduate Loans: $ 150,000 (paid after graduation)
- MBA School Payment Plan: $ 30,000 (paid over a two-year program)
- Mortgage: $ 70,000 (with approximately 20 years of remaining payments)
To select spoke with the couple about their debt repayment journey and how they manage to have fun along the way.
Here are some takeaways.
The couple met as undergraduates at the University of California at Riverside, but they only merged their finances four years, a mortgage, and $ 150,000 in law school loans later. After their marriage, LeVar added another $ 30,000 bill to their household budget when he decided to attend business school. They made a plan to pay for the degree during his two-year program. And when the couple moved to Oakland, Calif., For Reanne’s job, they added another mortgage to the total.
But as they took on new debt, they adjusted their plans.
“I’m a pretty strategic person,” Reanne told Select. “I knew I was going to join my [law] closes in the fall [after graduation]. And so I figured out that what I was gonna do was more than what I took [in loans]. “
Before borrowing student loans to return to graduate school, consider your expected salary and the cost of living you expect after graduation to see if the loans will be worth it.
“It’s an investment,” says Reanne. “I think some people don’t see it that way. Then you could take out loans that aren’t necessary, borrow more than you need, or start a career that wouldn’t recoup that amount. loan. “
You should also ensure that the degree you are pursuing is necessary in your field, she says.
When LeVar decided to get an MBA, he opted for an online program in order to lower the overall cost of the degree.
While some might not want to pass up the school of their dreams, LeVar leveraged his previous work experience and his new, cheaper degree to focus on building his resume, not his debt load. .
And he has no regrets: “An MBA is good to have just for business acumen, but it’s not really necessary for my day-to-day job,” says LeVar. “I ended up not looking USC for example. It was $ 100,000. The school I attended has almost the same name in the US, but it’s like a fraction of the cost. “
Most of Reanne’s income was used to make aggressive payments on her six-figure student loans. This suited her husband, who took care of household expenses and the lion’s share of their long-term savings and investment goals.
The couple did the math to determine what was the most aggressive payment Reanne could consistently make to pay off her debt plus interest in five years.
“We are committed to that number,” LeVar said. “We said, ‘whatever it takes.’ And then any extra income we had, like a bonus or a raise, we would just pay more. “
This division-to-win strategy worked well for the couple. Both earned good salaries and saw debt repayment, savings and investment as part of the same goal: to increase their combined net worth.
“We both contributed to our mortgages,” explains LeVar. Meanwhile, they split the rest of their monthly budget like this:
- Current expenses (food, utilities, etc.)
- Rental mortgage in LA (when not occupied by tenants)
- MBA Student Loan Payment
- Part of the primary mortgage in Oakland
- Student loan payment (approximately $ 4,000)
- Majority of primary mortgage in Oakland
The biggest line item in Harris’ budget was Reanne’s $ 4,000 student loan repayment. She was paying about $ 2,800 more than her minimum payment each month, which was about a quarter of her pre-tax income.
LeVar and Reanne are proud of how they have managed to preserve their quality of life while paying off $ 180,000 in student debt and approximately $ 70,000 in their mortgage.
First and foremost, they decided to be honest and transparent. They spoke openly about money – a topic friends and family may have once considered taboo – and overcame any negative feelings about their debt.
People around them found their demeanor refreshing, so the couple launched a YouTube channel and designed a Online course help others. It gave them a fun new project and another opportunity to help people.
The couple also learned to maximize their credit card rewards so they can take a memorable vacation while prioritizing debt repayment.
“We were able to travel because we had the Chase Sapphire Reserve® map and the Uber credit cardThe couple said. Together they earned thousands of credit card points which they used in combination with Expedia points to pay for a large portion of their travel.
“We were able to pay for at least 70% of our trips with our points,” says LeVar.
The trip helped make the monthly student loan payments of $ 4,000 a little less painful. “We were making these aggressive repayments on my loans, but we could always be like, ‘Okay, we’ve got this big trip at the end of the year.
Otherwise, it may feel like work and no reward, she says.
Over the years, the couple have visited Greece, Italy, France and more. Currently, they are taking a break from their travels as the world awaits the coronavirus pandemic.
“At least for this year, we don’t see ourselves getting on a plane.”
Many travel credit cards, such as the Chase Sapphire Reserve, now allow cardholders to use their rewards for other purchases during the coronavirus pandemic.
As of November 1, new and existing Chase Sapphire Preferred® Card and Chase Sapphire Reserve Card Members can earn 2X and 3X points on grocery store purchases, respectively, up to $ 1,000 in purchases per month. The new grocery store reward rates apply for six months until April 30, 2021.
10X points on Lyft trips through March 2022, 3X points on worldwide travel (immediately after earning your annual $ 300 travel credit), 3X points on restaurant meals, including delivery services eligible, takeaways and restaurants, 1X point for $ 1 on all other purchases
Earn 60,000 bonus points after spending $ 4,000 on purchases in the first 3 months after opening the account
Variable from 16.99% to 23.99%
Balance transfer fees
Foreign transaction fees
Once you have a clear idea of where your debt is, you can make a plan to pay it off, as LeVar and Reanne did.
Experiential offers a free credit monitoring service that allows you to register without providing a credit card number and gives you an overview of your entire borrower profile. View all your credit cards and loans, along with their balances, in one place. Keep track of your payments on time and monitor your accounts for fraudulent activity.
Keeping control of your finances and accounts will help protect your credit rating and make sure you have access to the right kinds of products at lower interest rates for years to come, whether it’s going back to school, buying a home, or taking out a loan for a car.
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The Uber credit card information was independently collected by Select and was not reviewed or provided by the company prior to posting.
Editorial note: Any opinions, analysis, criticism or recommendations expressed in this article are the sole responsibility of the editorial staff of Select and have not been reviewed, endorsed or otherwise approved by any third party.