Shortly after I started this little thing I call Let Luc Finance, a reader emailed me with questions about her student loans. This reader had 7 loans with outstanding balances totaling just under $17,000. That’s no small balance! She asked me some questions about how to pay them down and whether she should refinance.

I was able to easily review her loans because she was so organized. She knew the exact amount, to the penny, of every outstanding loan and the interest rate on each. (Note: This is an important part of managing your personal finances. You have to know where you stand. How else can you track your progress?)

I determined that refinancing did not make sense – it often doesn’t. She was willing to aggressively pay down her loans using the best approach, which, in her case, meant paying down the loan with the highest interest rate first, then the next highest, and so on.

There was no fancy trick or shortcut to paying off the debt. This person had to spend less in other areas to aggressively pay down the loans. And she wanted to do it as fast as possible. Together, we determined that it could be done in 2 years (1.5 if she was really aggressive). And she was! Over the last year, I would regularly get messages that another loan had been paid off – and that momentum proved to be motivating. In one year, almost to the day, $17,000 in student loans were all paid in full! (And thousands of dollars in interest payments were saved!)

That’s the secret: you just have to do the work.

There’s no shortcut except to spend less and pay off (or save) more. You can do it. Don’t hold out for some get-rich-quick-scheme or make excuses. Stick to basics, spend less, and achieve your goals…it just might take a year!

What’s your current personal finance goal? If you need someone to keep you accountable, just send me an email.

Until next time,

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