This week's episode of Money Diaries: The Podcast is a really tough one. Our caller is not spending $300 a month on wine or lamenting the fact that her husband doesn't want to take a beach vacation. Alex is 29 and has $90,000 in student-loan debt. She's also woefully underemployed, helping to care for her disabled mother, and doesn't see a future where she's earning enough money to make a dent in her debt.
"It was kind of embarrassing and shameful," Alex says of her ballooning debt. "But we have to talk about these things because I'm not the only one." Indeed, a staggering 44 million Americans have student-loan debt, and there are estimates that 40% of borrowers will default on their loans by 2023. And there isn't an easy fix to this problem — this is not the time to give Alex shit for buying a latte.
In this episode, my co-host, Paco De Leon, and I dig into the complicated student-loan forgiveness program, how to manage the stress and anxiety of carrying so much debt, and why it's important to focus on a plan for earning more in the future. Maybe it's hard to hear, but it's true: The fastest way to pay off debt is to make more money.
If you're struggling with student-loan debt, Paco shares a lot of resources during the episode. She talks about her friend Melanie Lockert, who wrote extensively about paying off $81,000 in student loans on her blog, Dear Debt. Paco also recommends visiting Student Loan Hero, Student Loan Planner, Boston Student Loan Lawyer, and Ask Heather Jarvis. And of course, if you want to know if you qualify for the federal student-loan forgiveness program, make sure to visit studentloans.gov.
Also remember that you're not alone. There's no quick answer, but if you look at it like a mortgage — a long-term investment you can pay down slowly — it can make it seem (slightly) more manageable.
You can also listen to the episode on iTunes, Spotify, or your favorite podcast app. And while you're at it, please subscribe, give us a rating, and leave us a comment if you like the episode! You can read more about Alex and her struggle to pay off her loans here. Also, I have a whole chapter on debt, with lots of great resources for anyone with student loans, in my book Refinery29 Money Diaries: Everything You've Ever Wanted to Know About Your Finances...and Everyone Else's. You can pick up a copy here!