How This 29-Year-Old Paid Off $113,000 In Student Loans In 7 Years: Part 2

By Mentor Staff | Edited By Mentor Staff

Updated On September 14, 2022

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Student loan repayment in less than 7 years. Meet Jessica Elberfeld – the Millennial who did it and shared her story with Mentor.

Jessica Elberfeld paid off $113,000 in student loans in less than seven years.

In Part 1 of How This 29-Year-Old Paid Off $113,000 In Student Loans In 7 Years, Elberfeld shared with Mentor (and Forbes) her inspiring student loan journey and her strategy for student loan repayment. With interest rates as high as 10.75%, Elberfeld knew she had to do something about her student loans than make an interest-only payment.

Here is Part 2 of our interview, in which Elberfeld discusses student loan mistakes, Dave Ramsey, Robert Kiosakyi, IRAs, her financial goals and more:

Top Picks For Student Loan Refinancing

December 2022

Variable APR ?APR, or Annual Percentage Rate, is the price you pay to borrow money. Variable APR means that your interest rate can fluctuate over time, which can increase or decrease your monthly student loan payment. Typically, a variable-rate loan has a lower introductory rate than a fixed-loan rate loan. Variable APR includes a 0.25% discount when you enroll in autopay.
Fixed APR ?APR, or Annual Percentage Rate, is the price you pay to borrow money. Fixed APR means that your interest rate will always stay the same. Even if interest rates change, your interest rate or monthly payment will not. Fixed APR includes a 0.25% discount when you enroll in autopay.
APR
4.49% - 8.99%
4.49% - 8.99%
4.49% - 8.99%

View Details

on SoFi's website

Overview

Variable APR:
4.49% - 8.99%
Fixed APR:
4.49% - 8.99%
Minimum Credit Score:
650
Minimum Income:
None
Fees:
None
Minimum Loan Amount:
$5,000 ($10,000 in CA)

Details

Eligible Loans:
Private & Federal
Eligible Degrees:
Undergraduate & Graduate
Loan Terms:
5, 7, 10, 15, 20 years
Borrower Residency:
All states
Hardship Deferment:
Yes
Co-signer Option:
Yes
3.99% - 8.29%
4.39% - 8.99%
3.99% - 8.99%

View Details

on Earnest's website

Overview

Variable APR:
3.99% - 8.29%
Fixed APR:
4.39% - 8.99%
Minimum Credit Score:
650
Minimum Income:
None
Fees:
None
Minimum Loan Amount:
$5,000

Details

Eligible Loans:
Private & Federal
Eligible Degrees:
Undergraduate & Graduate
Loan Terms:
5-20 years
Borrower Residency:
All States except NV
Hardship Deferment:
Yes
Co-signer Option:
No
3.99% - 8.29%
4.39% - 8.99%
3.99% - 8.99%

View Details

on NaviRefi's website

Overview

Variable APR:
3.99% - 8.29%
Fixed APR:
4.39% - 8.99%
Minimum Credit Score:
650
Minimum Income:
None
Fees:
None
Minimum Loan Amount:
$5,001 ($10,001 in CA)

Details

Eligible Loans:
Private & Federal
Eligible Degrees:
Undergraduate & Graduate
Loan Terms:
5-20 years
Borrower Residency:
All States except NV
Hardship Deferment:
Yes
Co-signer Option:
No
3.53% - 7.24%
4.48% - 7.29%
3.53% - 7.29%

View Details

on ELFI's website

Overview

Variable APR:
3.53% - 7.24%
Fixed APR:
4.48% - 7.29%
Minimum Credit Score:
680
Minimum Income:
$35,000
Fees:
None
Minimum Loan Amount:
$10,000

Details

Eligible Loans:
Private & Federal
Eligible Degrees:
Undergraduate & Graduate
Loan Terms:
5, 7, 10, 15, 20 years
Borrower Residency:
All States
Hardship Deferment:
Yes
Co-signer Option:
Yes
2.50% - 8.65%
3.99% - 8.49%
2.50% - 8.65%

View Details

on Splash's website

Overview

Variable APR:
2.50% - 8.65%
Fixed APR:
3.99% - 8.49%
Minimum Credit Score:
640
Minimum Income:
None
Fees:
None
Minimum Loan Amount:
$5,000

Details

Eligible Loans:
Private & Federal
Eligible Degrees:
Undergraduate & Graduate
Loan Terms:
5 – 25 years
Borrower Residency:
All states
Hardship Deferment:
Varies
Co-signer Option:
No
5.09% - 11.67%
5.39% - 11.87%
5.09% - 11.87%

View Details

on Citizens' website

Overview

Variable APR:
5.09% - 11.67%
Fixed APR:
5.39% - 11.87%
Minimum Credit Score:
Not disclosed
Minimum Income:
$24,000
Fees:
No prepayment or origination fees
Minimum Loan Amount:
$10,000

Details

Eligible Loans:
Private & Federal
Eligible Degrees:
Undergraduate & Graduate
Loan Terms:
5, 7, 10, 15, 20 years
Borrower Residency:
All states
Hardship Deferment:
Yes
Co-signer Option:
Yes
2.50% - 6.80%
4.49% - 6.90%
2.50% - 6.90%

View Details

on Laurel Road's website

Overview

Variable APR:
2.50% - 6.80%
Fixed APR:
4.49% - 6.90%
Minimum Credit Score:
660
Minimum Income:
None
Fees:
None
Minimum Loan Amount:
$5,000

Details

Eligible Loans:
Private & Federal
Eligible Degrees:
Undergraduate & Graduate
Loan Terms:
5, 7, 10, 15, 20 years
Borrower Residency:
All States
Hardship Deferment:
Yes
Co-signer Option:
Yes
3.27% - 6.87%
3.99% - 10.68%
3.27% - 10.68%

View Details

on LendKey's website

Overview

Variable APR:
3.27% - 6.87%
Fixed APR:
3.99% - 10.68%
Minimum Credit Score:
680
Minimum Income:
$24,000
Fees:
None
Minimum Loan Amount:
$5,000

Details

Eligible Loans:
Private & Federal
Eligible Degrees:
Undergraduate & Graduate
Loan Terms:
5, 7, 10, 15, 20 years
Borrower Residency:
All states, except ME, ND, NV, RI, WV
Hardship Deferment:
Yes
Co-signer Option:
Yes
-
3.94% - 9.08%
3.94% - 9.08%

View Details

on ISL's website

Overview

Variable APR:
-
Fixed APR:
3.94% - 9.08%
Minimum Credit Score:
670
Minimum Income:
None
Fees:
None
Minimum Loan Amount:
$5,000 ($10,000 in CA)

Details

Eligible Loans:
Private & Federal
Eligible Degrees:
Undergraduate & Graduate
Loan Terms:
5, 7, 10, 15, 20 years
Borrower Residency:
All states, except OR and ME
Hardship Deferment:
Yes
Co-signer Option:
Yes

Zack Friedman (ZF): What student loan repayment mistakes, if any, did you make along the way?

Jessica Elberfeld (JE): My “extra payments” to Sallie Mae came in the form of lump sum payments to my savings account. So instead of putting my extra $200 one week directly toward a student loan payment, I would put it into my savings account. Then, I would only transfer my savings to repay my student loans once my savings reached a certain amount, which was usually $3,000 – $4,000.

ZF: What would you have done differently?

If I would have put every dollar directly towards a student loan when I had it and not put it into my savings account first, I could have avoided some interest.

ZF: What student loan mistakes do you see your friends make?

JE: Throughout this journey, I have found that some friends are pretty content with living paycheck to paycheck and some friends are 100% content with having debt.

Some have student loans, car payments, mortgages and credit card balances; several of them have all of those combined, plus others. Once I found my way with debt payoff, I all but shouted it from the rooftop as I wanted those close to me to understand that this was the way we should be going. But, as time went on, I learned people are going to do what they want, and their want is not the same as mine.

ZF: What advice would you offer to your friends?

If I could suggest one piece of advice, it would be to stop financing everything just because the financing option is available; and on the items that are already financed, make a payoff plan. Knowing some friends will still have their student loans when they are in their mid-40s is tough to witness.

ZF: What, if anything, would you have done differently in terms of student loan repayment?

JE: I would have tried to refinance my loans again in 2014 versus 2015.

Between 2009 and 2012, I tried refinancing with Sallie Mae, Chase and Wells Fargo. I was rejected 11 times total for the same reason: debt to income ratio. I kept all 11 rejection letters and possess 3 from Sallie Mae, 5 from Wells Fargo and 3 from Chase. That was a very discouraging time period for me so I knew I had to significantly increase my income and decrease my debt if I was ever going to qualify for student loan refinance.

ZF: Do you have a 401(k)? Do you take advantage of your employer’s 401(k) match?

JE: I have an IRA from a previous 401k that I rolled over. I do take advantage of my current employer’s match at 6%. I plan to open a Roth IRA this April and hope to contribute the maximum amount every year going forward.

ZF: How did you choose between student loan repayment and retirement contribution?

JE: When I decided to snowball my student loans, I read about Dave Ramsey’s advice to temporarily stop your 401k and stock contributions so that you focus all possible income on the loan payoff. Since it was only temporary, it made sense for my situation. However, throughout repayment, I never could quite commit to stopping so I always kept my 401k contribution at 1-2%. I understand this is not much, and it was definitely below the company match, but it was something.

ZF: Now that your student loans are repaid, what are your other financial goals?

JE: My first goal outside of being debt free is to fully stock an emergency fund in a money market account by this March.

Then, I have three different plans in mind for my monthly discretionary income:

  1. Open a Roth IRA and make monthly contributions (around $450) until I have hit the contribution limit.
  2. I will be saving for a car, since I am still driving the same SUV I have had since I was 16. I am 29 now.
  3. I will be setting a little bit aside to get my feet wet in investing – whether that consists of stocks, low-cost index mutual funds or something else that I have yet to learn.

ZF: Do you invest and, if so, what has been your investment strategy?

JE: Other than retirement and an existing Employee Stock Purchase Plan, not at this current moment. There are two financial gurus who teach opposing investment practices, and it is my goal to keep learning more about both approaches.

Dave Ramsey’s game plan (after fully stocking an emergency fund) is to play it safe by eliminating risk through diversification in low-cost index funds – all while being completely debt-free, of course.

Robert Kiyosaki’s plan is to not save any money, but invest it all into income generating assets which are all fruitful, therefore eliminating the need to diversify– and in direct contract with Ramsey, use “good” debt to finance all of these investments.

I’m on the hunt to see if I can find a middle ground between the two. Mentor can help you learn more about student loan options, investing and more:

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