In honor of graduation on Monday I thought I would start this new financial journey with my student loans.

Spring of 2007 I started applying to pharmacy schools. DH is in the Navy and we knew that it was possible for us to be stationed in one of the four corners of the US (Hawaii, Washington State, Maine and Florida). At the time I wasn’t aware of a pharmacy school in Hawaii, I missed the requirements for the school in Washington state by 1 biology credit (did I mention I was a biochem major in undergrad…how did this happen?!?!) and I was accepted to a pharmacy schools in New Hampshire (the closest to Maine) and University of Florida.

If we ended up selecting Washington or Hawaii, I’d put pharmacy school off for a while or go into something else. The base in Maine was closing so we knew eventually DH would come back to Jacksonville if he was stationed there, but we were holding out hope he would get Jacksonville and we could live together. Well the DAY of orientation, during my lunch break, we found out that DH had been selected to go to Maine and be the first squadron to come back to Jacksonville. I remember asking him “so that means I’m going to stay here [at UF], right?”

So needless to say things were a little up in the air there for a while. We had no idea how much life would cost supporting two households or how much school stuff would cost or anything. So we decided to take all of the loans offered that first semester, both subsidized and unsubsidized. I took all of the ‘profit’ in our savings account. I say ‘profit’ because they give you a bunch of money, take out tuition and give you the rest to live on. Second semester we took out the subsidized loans and my in-laws offered to pay for tuition. For my second year we continued to take out the subsidized loans and then used that ‘profit’ from before to cover gaps. Each semester we took out the subsidized loans, but it didn’t quite cover tuition so after the ‘profit’ was gone we started setting aside $350 a month to save up for those tuition payments.

So now 4 years later I’ve got just over $44,000 in student loans which will continue to be on deferment until November (colleagues who took everything have 100K or more). Since I will be starting a residency, they can be put back on deferment. I’m not exactly sure for how long. My program lasts until June, so at least until then, but I’m not sure if I get another 6 month grace period or not. The unsubsidized loans are currently at 6.8%, and they all with be at that rate when the deferment ends.

Our goal is to pay it off in 5 years. However, I plan to put $1000 a month toward them, which, especially with deferment, should pay them off in about 4 years or so. The nice thing is that with our slush fund whenever we get sick of them we can just cut a check and be done with it. Probably not the best thing financially (paying higher interest than we are earning in our checking account), but liquidity and flexibility is key in the Navy.