Student Loans? What Student Loans?
How does a pair of wide-eyed PTs go from $200K in student loan debt to debt free in less than 2 years? Travel PT!
Heres the scoop.
Ellen and I met in PT school back in 2008. We graduated as DPT’s in 2011 along with the 6-figure tab of student loan debt each, and took our first outpatient PT jobs in Southwestern Colorado. We were saddled with over 250k in total student loans – enough debt for a small house.
With some big plans for our future we were working our butts off. All of our spare change was going towards loans instead of ski lift passes. Prioritizing debt relief over knee deep pow!
Although we started at jobs paying $60-70K/yr (pretty good for new grads in 2011), we were only able to knock out approximately 10% of our debt over our first two and a half years, partly thanks to the nice sign on bonus that Ellen’s job provided. It was about this time that we decided something had to change!
Married in June 2013 we had a combined debt of $200K hanging over our now legally bound heads (“bound” seems a very appropriate term when discussing debt), we began to set things in motion to hit the road as travel PTs. Travel PT was something that both of use were interested in even before we started dating, so we set out to see the world – and find out if travel PTs really did make more money.
The way we looked at it was simple. We already lived conservative lives in one really amazing location – worst case scenario we would still have to live conservative lifestyles, but in MANY really amazing locations.
Our first contract was in Berkeley, CA and we were flabbergasted to be paying $1,800/mo for an apartment in someones basement… then our first paychecks rolled in.
In the next year we would pay down the balance of Ellen’s student loans by $50K! During this time we paid the minimum on my loans opting for the “snowball effect” to maintain our motivational momentum.
Snowball Effect – Lumping payments on a single loan while paying the minimum on the others, preferentially paying off the loan with the highest interest rate first (though there is benefit emotionally to paying off the loan with the lowest balance first if you need that boost). Watching the number of loans (or debts) tick off is shockingly encouraging. Depending on the analogy you prefer, it is either like the African Proverb about how the only way to eat an elephant is one bite at a time – or for you Anne Lamott fans, you just go “Bird by Bird.”
As we continued to travel over the next 9 months we finished a year in Alaska and then back to California all the while paying off Steve’s loans one group at a time.
Due to the interest accumulating on my loans progress seemed slow at first, but as each loan group was slowly paid off we began to gather speed towards freedom.
Within 21 months of traveling we finally became PT school debt free in December 2015. Less than 2 years after we started traveling!
Sure, you all paid $200K in loans off in less than 2 years, but you had to live like paupers!…Right?
Nope! Not even close!
Anyone who has stalked our respective Facebook feeds can thumb on down far enough to see proof for themselves of just the type of lifestyle we lived during this time. For those of you less inclined to act like a creeper, here is a brief highlight list:
- Climbed Half Dome and Mt. Whitney in the Sierra’s
- Warriors and Giants games
- Biked San Francisco and the Golden Gate Bridge
- Multiple backpacking trips into the Lost Coast and Trinity Alps wildernesses
- 2 Alaskan Whale/Glacier Cruises
- Salmon fishing on the storied Kenai and Russian Rivers
- Hiked Matanuska glacier – 5 times!
- Multiple flight-seeing trips
- Obtained a coveted Denali Drive Through Pass to photograph Brown Bear
- Backcountry Skied the Chugach Mountains
- Landed VIP passes to the Honorary Start at the Iditarod
- Sea kayaked with whales and dolphins – twice
- Lived 1.5 Blocks from a secluded California beach
- Obligatory Disney Land vacation
- Countless wine tasting excursions in Napa Valley, Paso Robles, and the Central Coast
- Visited 8 different National Parks
But wait! It doesn’t end there!
For those of you who have followed us over the last few years, pre-blog, you might recall that December 2015 was also when we attempted to transition back to “perm life” in Colorado.
We took positions back in our tax home and made plans to settle down and buy a house. Everything seemed to be going smoothly up until this point. We were graduate school debt free, had countless stories from our amazing time traveling, and were now going to settle down in our dream town… then we looked closer into buying a home.
Apparently our dream town was also other, wealthier folks dream town as well. With house prices starting in the high $300’s for a 2-3BR fixer-upper, the wind was quickly taken out of our financial sails.
Given the cost of living in town, just to pay rent, and what we were now making as permanent staff (which was less than half of the after tax income compared to traveling), we calculated that it would take 7-8 years to save enough for the full downpayment. Clearly not being the types to feel comfortable with shouldering a huge loan, we just could not wrap our minds around only putting the minimum 5% on a home.
Conveniently, in hindsight, our permanent positions soured (it was a crazy situation to say the least) and within 3 months we decided that traveling was going to be our lifestyle for the foreseeable future.
Talk about a blessing in disguise!
Flash forward 16 months – we now have more than our 20% down payment socked away and ready to go. During the course of our travels we purchased a Tundra for ultimate travel flexibility and have paid it off in full (taking a car loan at a lower interest rate than our student loans we took the full cost of the truck out as a loan and dumped our car savings onto loans, saving nearly $3,000 in the process). We also took a total of 8 weeks off in 2016 – a huge 6 week chunk during the summer of 2016 with additional long weekends throughout the rest of the year. We are now in the final stretches of preparing for another 8 weeks off to welcome our baby girl into the world!
Thanks to our aggressive attack on our student loans we now have the freedom that comes with actually getting to KEEP the money we make! While we have no idea what our future holds – yes, we plan on traveling as new parents – we now have eliminated our debt burden and subsequently reduced our minimum required monthly income enough to free up one of us to be stay at home parent for the time being and continue making progress towards retirement and other financial goals.
Please do not take this article as bragging or boasting. We simply are trying to further illuminate the benefits of travel PT and how it truly has been life changing for us. The overarching goal of this blog is to demonstrate and promote the freedom that being a travel PT brings. In this case it gives you the freedom of having total control over the money you make. Want to save for retirement and attempt to retire early? – you can. Want to throw caution to the wind and travel the world and only minimally save for retirement? – thats ok too! Had we never traveled who knows where we would be financially. Dreams of language school in South America or extended service trips overseas would have never even been a possibility with the debt of PT school lingering over our heads.
*Full disclosure: We have one loan remaining for my undergraduate education. At 2.25% interest we have chosen to front load our retirement savings over the next few years to capitalize on the time benefits built into the magic of compounding interest.
Written by Stephen Stockhausen