Goal to eliminate student loan debt in a year pays off
When Italina Kirknis decided to go to law school, her plan was pretty straightforward: graduate with a law degree, find work as an attorney and pay off her student loan.
Kirknis initially set herself up for success by working part time while she attended Lincoln Law School of Sacramento in California and used her earnings to slowly chip away at student debt.
So, while her friends were cramming for exams, Kirknis was figuring out ways to make her monthly payments.
Though she was only knocking off a few hundred dollars of debt each month, Kirknis’ early and continuous plan to pay off her 7% loan left her with a more manageable remaining balance of about $28,000 when she graduated in 2010.
After graduation, Kirknis, 30, who lives in Oakland, Calif., continued making monthly payments even before she won a full-time job.
"I knew exactly how much I owed. And I figured that after I got a job, I’d divide the payment by 12 months, committed to paying every single month regardless of what happened," she said.
But goals aren't always easy to achieve.
Kirknis had a change of heart about becoming a lawyer, and it took some time to find a job that suited her degree. After a lengthy search, Kirknis landed a job as an adjunct professor at Heald College in northern California.
"I wanted to stick with my original plan to get out of debt in a year — only it was going to be a lot harder to do that on a professor’s salary," she said.
Instead of extending her get-out-of-debt plan for another year or two, Kirknis instead decided to change her lifestyle in order to reduce her student debt by about $2,000 every month.
While she’d initially hoped to move into a bigger place, Kirknis realized that the only way to get out of debt in a short amount of time was to consciously live below her means, living frugally in a studio apartment.
"I bought nothing new. No new clothes, no new car. I ate at home. I lived as though I was a student," Kirknis said.
She lived well enough, but not luxuriously. “I didn’t walk around with holes in my clothes. I didn’t live in a dump.”
Kirknis’ accelerated plan to emerge from student debt worked out.
"I graduated from law school in summer of 2010, I got a job in January 2011 and in December of 2012 I made my last payment," she says.
And while she admits to having started to enjoy splurges including manicures and massages again, Kirknis has permanently changed her spending habits.
"I would tell anyone, just because you’re making more doesn’t mean that you have to increase your spending," she says. "I would tell people to continue living below their means."
One of the benefits of spending significantly less is that now that Kirknis earns more, she has a steady and ready cash flow.
“I love having cash flow, instead of having it tied up in car payments. Regardless of how much I’m making, I like having the cash available.”
Kirknis has since left teaching and has opened her own public relations firm — Italina Image & Branding — with no loans.
Kirknis offers the following tips for recent college graduates who want to pay off their loans quickly:
- Have a get-out-of-debt plan and modify as needed. Kirknis had a clear plan to pay off her student debt. What she didn’t have was a job. When she found a job that paid significantly less than expected, she changed her spending habits to keep to her payment plan.
- Live below your means. Having a long-term goal sometimes means forgoing everyday frivolities. Kirknis learned to do without while paying back student debt and permanently changed her spending habits and lifestyle.
- Invest in yourself. While Kirknis ultimately did not choose to practice law, her investment in a law degree proves lucrative to her personal brand. "My degree gives me credibility and people ask about my education, my background, and they seem impressed with it," she says.