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Lessons learned from someone who paid off nearly $100,000 in student loan debt

Burdened with your student loans? CNBC Select gets some advice for borrowers from someone who chronicled her debt payoff journey.

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If you're someone who has student loans, you certainly aren't alone.

Some 42 million Americans (one in six adults) carry a federal student loan. Collectively, these borrowers hold over $1.6 trillion in student debt.

Yet it's no secret that a college degree puts you on track to earn more over the course of your career. According to various sources, that amount can range on average from 45.4% to more than 60% higher earnings compared to someone with a high school diploma.

But not long after graduation, the reality of student loan debt sinks in, making it harder to reach conventional milestones like starting a family or buying a home — let alone a sense of inner peace.

CNBC Select spoke about this conundrum with Melanie Lockert, author of the book, "Dear Debt," which is based on her long-standing blog of the same name. The blog that Lockert started while in debt chronicles her payoff journey and how her $100,000 in student loans dwindled down to $0 over the course of nine years.

After completing undergrad at California State University, Long Beach, and her master's at New York University (NYU), Lockert had a total of $81,000 in student loans, and what she estimates is closer to $100,000 with interest. It took a lot of side hustling and a career of freelancing, but Lockert was able to walk away debt-free and with a handful of takeaways to share.

Below are the debt payoff lessons she learned.

1. Find out what works for you

Paying off debt is personal. Lockert already had a minimalist lifestyle, cutting out nonessential expenses from her budget and selling her things for extra cash. Rather than focus on cutting out more, she had to find out how to build her income. Focusing on frugality alone wasn't enough.

Everyone's strengths and weaknesses are different. Lockert already knew how to cut costs so she focused on increasing her income substantially by blogging and freelancing. Another person may already have a stable income and need to pay better attention to budgeting and trimming costs.

Before you leap head-first into strategies that have worked for other people, take some time to learn how you budget, how you save and how you spend so that you can quickly prioritize your student loans.

Learn more: How to create a budget in 5 steps

2. Side hustle for fun

"If people are trying to side hustle to make more money, think of it as a way to experiment and have fun," Lockert says.

In her free time, Lockert would find odd jobs to make extra cash to pay toward her loans. What started as a necessity ended up feeling like a second hobby. She used TaskRabbit and Craigslist to find new opportunities and experimented with gigs like selling bottled water at overnight raves, helping someone plan a 50th birthday party and pet sitting.

Examine what your talents and interests are; there's likely a way you can make money from them — even during quarantine amid the coronavirus pandemic.

If you have a particular knowledge of a certain topic, you can explore tutoring virtually from your home through online services like Chegg Tutors. Online tutoring can also come in the form of teaching skills like crafting, cooking, music, language and fitness lessons. Check out resources like Skillshare for a variety of different teaching options and Verbalplanet for languages.

During this time, you can also resell items online through Facebook Marketplace, offer to clean your neighbor's house, walk their dog or help with their landscaping. If you have a laptop and a WiFi connection, get paid to take consumer surveys online through sites like Survey JunkieSwagbucks and Vindale Research.

"It's not a full-time job where you have to know everything you can," Lockert says. "Think of it as a way to learn something new."

Learn more: 5 easy ways to earn extra money from your couch

3. Make sure to reward yourself

When you start chipping away at your debt, rewarding yourself along the way will help motivate your efforts.

After reaching a certain payoff goal, such as $5,000 or $10,000, Lockert would treat herself to a dinner out or a massage.

For the many continuing to shelter in place these days, reward yourself with some self-care. Meditation apps like Aura allow you to relieve stress in just a few minutes or you can treat yourself with an art or gardening kit to take your mind off your debt.

While you still have to consider budget, know that rewarding yourself can be worth the periodic costs if it keeps you motivated and on track long-term to pay off your debt.

4. Think about interest in terms of daily cost

Lockert's interest rate on her student loans served as an expensive wake-up call about just how much her student debt was costing her. When she graduated from NYU, she realized she was paying $11 each day in interest alone.

Because student loans charge daily interest (like most credit cards when you carry a balance), Lockert recommends that borrowers calculate their daily interest amount. "That can be a huge wake-up call and why it seems like you're not making any progress," she says.

And whenever you can, try to pay more than the minimum to really make a dent in your debt.

5. Create a 'debt-freedom dream list'

When Lockert ever doubted herself, she would take a look at her "debt-freedom dream list" that helped her realize what she could do once she paid off her student loans: take her mom to Italy, get pet cats and move back home to Los Angeles.

"I realized I had to stay focused so that I could have a better future," she says.

Write down your goals to help you visualize what a debt-free life has in store. Maybe, like Lockert, you also want to buy a home, a new car or take a vacation.

6. Don't forget about your savings

For Lockert, who didn't walk out of graduation with a full-time job, having back-up savings certainly helps in the debt payoff journey. When you have an emergency fund or a safety net of cash you can use when times get tough, this allows you to continue paying off your debt while covering your basic necessities.

If you're new to saving, you don't need much to get started. Even putting aside $20 per week will help you save $1,000 in a year. The best savings accounts offer a high interest yield with no minimum deposits required to open an account.

For example, the Ally Online Savings Account does not require a minimum account balance to earn interest nor monthly maintenance fees. It also makes a good choice for anyone looking to do all their banking in one place. With an Ally checking and savings account, you have access to over 43,000 free Allpoint® ATMs, making it easy to withdraw cash when you need to.

Ally Bank Online Savings Account

Ally Bank is a Member FDIC.
  • Annual Percentage Yield (APY)


  • Minimum balance


  • Monthly fee

    No monthly maintenance fee

  • Maximum transactions

    Up to 6 free withdrawals or transfers per statement cycle *The 6/statement cycle withdrawal limit is waived during the coronavirus outbreak under Regulation D

  • Excessive transactions fee

    $10 per transaction

  • Overdraft fees


  • Offer checking account?


  • Offer ATM card?

    Yes, if have an Ally checking account

Terms apply.

If you want a high-yield savings account that gives you ATM access without having to open a checking account, then consider the Synchrony Bank High Yield Savings where withdrawing money is quick and easy if you ever need it. Synchrony Bank offers an optional ATM card for unlimited transactions to its savings account holders. The bank won't charge an ATM fee, but the ATM provider may. For these charges, Synchrony Bank refunds ATM fees in the U.S. up to $5 per statement cycle.

There is also no minimum balance requirement and zero monthly fees with this savings account.

Synchrony Bank High Yield Savings

Synchrony Bank is a Member FDIC.
  • Annual Percentage Yield (APY)


  • Minimum balance


  • Monthly fee


  • Maximum transactions

    Up to 6 free withdrawals or transfers per statement cycle *The 6/statement cycle withdrawal limit is waived during the coronavirus outbreak under Regulation D

  • Excessive transactions fee

    None, but may result in account closure

  • Overdraft fees


  • Offer checking account?


  • Offer ATM card?


Terms apply.

7. Take care of your mental health

Though Lockert worked full-time and side hustled almost seven days a week for multiple years to pay off her loans, she admits it took a toll on her mental health and she became depressed.

"I think it's not worth burning yourself out over trying to get out of debt," Lockert says. "For a lot of things in life, we have to try to enjoy the journey. Take care of your mental health because nothing else in your life will work if it's not intact."

If you're mentally and emotionally struggling with the burden of student loans, Lockert advises to think of "what makes you happy." The coronavirus pandemic has taught many about getting back to the basics of what's important in life: health and safety. Your student loans, in retrospect, are quite manageable.

To remind yourself of this, Lockert suggests repeating a certain mantra, or phrase, to yourself when you feel anxious: "Say, 'I'm healthy, I'm safe, I have a roof over my head,'" she explains. "In today's world, that's rich."

There are also people you can talk to. The National Foundation for Credit Counseling (NFCC) offers a portal for people to call and receive free credit and student loan guidance from a nonprofit credit counselor. You can access the NFCC's free credit counseling service either through their website or by calling 844-865-1971.

Learn more: A financial therapist shares 3 tips to manage your money and stay sane during the pandemic

Bottom line

Whether you have 6-figure student loan debt, like Lockert nearly did, or something smaller, the above advice can be helpful in paying it off.

Be aware that if you are having trouble affording student loan payments during this time, the CARES Act protection for student loan borrowers has been extended through the rest of the year. Federal student loan payments are on pause and any interest accrued during this suspension is waived.

Learn more: How to spend your money now that student loan payments are on hold

Information about Ally Online Savings Account and Synchrony Bank High Yield Savings has been collected independently by CNBC and has not been reviewed or provided by the bank prior to publication.

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.
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