Drowning in Student Loan Debt? 4 Ways to Become Debt Free

Drowning in Student Loan Debt 4 Ways to Become Debt Free - F

Are you drowning in student loan debt? Too many of us are. Here’s a story of a recent conversation I had that sparked me to put together this info for you. Enjoy.

Recently at my son’s baseball game, I began talking with my old neighbor, Stew, who used to live across the street. We were reminiscing about the old days (cook outs, New Year Eve’s neighborhood parties, etc) and he said, “Jeff, you know if we would’ve stayed in that house, we would have paid it off about ten years ago. It sure would be nice to NOT have a mortgage.”

Stew is right, it is nice NOT to have a mortgage and be 100% debt-free. But you may be sitting here asking yourself,  “Jeff, How am I EVER going to get out of debt?”…let me help you show you how easy it is with a plan in place.

Proverbs 22:7 says “the rich rule over the poor and the borrower is slave to the lender.”

4 Ways to Become Debt Free

1 Make a List Of All Your Debts

Some financial “gurus” will tell you to start paying off your loans with highest interest rates first but I stuck with the Dave Ramsey way whenever I created by debt-free plan. His reasoning behind paying off the smallest debt FIRST is purely psychological which makes perfect sense.

This same strategy is also something that we routinely recommend with people that come into our practice that haven’t seen a dentist in years. If we “overwhelm” them with a HUGE treatment plan, more than likely they won’t do anything.

Overwhelm/confusion = no action

Instead, we start off by treating something small (typically their chief complaint) before tackling the rest of their mouth.

If you graduate with hundreds of thousands of dollars in student loan debt, plus you have credit card and car loans, then things can become overwhelming. Don’t forget about needing a place to live, schools to send your kids too plus you need some R&R down time with vacations, right?

Disney anyone?

“Look ma, no hands!”

This is the MAIN reason I agree with Dave to start off with the smallest debt & throw every thing you can at it BEFORE moving to the next one. While you are attacking each done, pay minimums on the rest before moving to the second largest. Make sense?

2 Cut Up The Credit Cards

One of the stupidest things people ask me when they are up to their eyelids in credit card debt and I tell them to cut up their credit cards is, “But Jeff, how will how I build up my credit score when I want to borrow money in the future?”


Well, let’s think about that for a minute. How did you get upside in debt in the first place? I’m sure credit card debt was one of the MAJOR reasons, right? So in that case, WHY in the freaking world would you NOT want to get rid of them and NEVER use them again?

It’s like a someone that has gone through Alcoholics Anonymous wanting to keep a bottle of beer in the fridge “just in case” they get the urge to take a sip in the future.

My goal is to have a ZERO CREDIT SCORE. Why? Because now that I’m debt-free, what do I need credit for anymore? If my wife and I can’t pay for it, guess what, we DON’T BUY IT!

3 Don’t be a loser


I see too many docs that get out of school that have visions of becoming wealthy but don’t have a clue where to start. One of the first questions they ask is,How much money should I start saving?

Before that question can be answered, ask yourself if you are paying interest on any credit cards first. If you are, it makes no financial sense to even remotely think about investing money.

Why? Let me show you…

The next time you get mail from a company wanting you to open up a new credit card with them, do me a favor, flip the application over and look at the big box on the back. Read through it and I can assure that somewhere in that box it will tell you that borrowing money from that credit card will cost you somewhere between 18% and 24%.


Bottom line: If you are NOT paying off your credit cards at the end of each month, then your friendly credit card company (the one that always asks “what’s in your wallet?”) is siphoning your money that could have been invested instead.

It doesn’t take much common sense to realize that paying 18-24% credit card interest and investing money that you hope & pray will provide you returns of 8-10% makes much sense.

I can tell you right now, if I could find an investment where I can earn between 18-24% interest, I would dig up the cans in my back yard, sell off all my prized possessions and scrape up every cent I had to invest.

Do me a favor. “Google” visa or master card headquarters and search for “images.” Nice BIG buildings they’re in, right? NOW you know where where your 18-24% interest payments are going.

Many docs think it’s OK to carry a balance on their credit cards too. Look, my rule is to get rid of them all together… unless of course you’re a millionaire and are using your reward points to purchase airline tickets or hotel rooms.

4 Pay Off The Mortgage Early

I know what you’re probably thinking…”why would I want to pay off my mortgage early, I have such a LOW interest rate.”

Reminder: The name of this site is DebtFreeDr.com!!

I want you out of debt, wealthy, financially independent and enjoying life as quickly as possible. Why would you want a 15 or even worse 30 year mortgage hanging over your head almost your entire career?

Why We Paid It Off Early

A. Personal Goal

After taking out a 15 year mortgage, we set a goal to pay off the mortgage as early as possible AFTER all other debts (student loans, vehicle, practice, family debt, etc) were paid off. What can we say, we like to meet our goals!

B. Free Up Cash

We can now take our previous mortgage payment and use that for something else. I take 80% of it and invest it in Vanguard Index Funds (I’ll talk about which ones in future posts) and 20% in our Vanguard Money Market account which is earmarked for vacations, vehicles or any other high price item. In addition, this lowers our fixed expenses and thus our need to replace that income in a financial independence/early retirement scenario.

C. Lowers Our Insurance Needs

When I first purchased my life insurance through Great West, I had to factor in the policy paying off our mortgage in case I bit the dust. Now, I no longer need it as the mortgage is gone.

D. Because We Could

There are too many people to thank that have helped me get to where I am today. I’m sure looking back and reflecting on your life, you can say the same thing. Because of their guidance, education decisions, hard work/sacrifice from my parents putting me through college, and financial common sense, we were placed in the position to pay off our 15 year mortgage after only 11 years.

For one thing, it seemed hypocritical as a multi-millionaire teaching others (including my kids) about debt while still lugging around our mortgage. It brings us one step closer to our financial goals.

What do you think? Do you plan to or did you pay off your mortgage early? Why or why not? Do you carry credit card debt or are you now ready to get rid of them forever? When do you think the typical doctor should pay off his mortgage?

Comment below!

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