How Joe Mihalic Paid Off $90K of Student Loans in 7 Months

by Will Chen

Joe Mihalic set a bold financial goal for himself in 2011 — he vowed to pay off all of his student loans, totaling $90,000, in ten months. Even though Joe had an MBA from Harvard and a solid job at a Fortune 50 tech company, he thought he needed to make some fundamental changes in his life to achieve this goal. To keep himself accountable, Joe started the blog No More Harvard Debt to chronicle his debt-fighting adventures. (See also: 15 Ways to Pay Back Student Loans Faster)

Often witty and always brutally honest, Joe’s blog captured the public’s imagination. While most of Joe’s readers have smaller debts and less ambitious payment schedules, nevertheless they identified with Joe’s gutsy determination.

Hundreds of people rooted him on with encouraging messages. “I actually find myself saying this when I’m thinking of buying something I don’t really need, ‘Okay, would Joe do this?’” commented Ryan Field, a fan of Joe’s blog.

In the end, Joe didn’t wipe out his debt in ten months. He did it in seven. Along the way Joe discovered a new, simpler lifestyle he continues to enjoy today. Recently I had an opportunity to chat with Joe about his amazing journey and his new book, Destroy Student Debt: A Combat Guide to Freedom

Q: Why did you decide to pay off your student loans so aggressively? What are the major emotional benefits of doing so?

Joe: I wanted peace of mind. One day in August 2011, I looked at my student loan balance and realized if I continue making only minimum payments, it would take me 15 years to pay it off. That fact blew me away. So I challenged myself to make some big changes.

I learned to live below my means — which is what I continued to do even after paying off my school loans. My life is now simple and stress-free. It’s a lifestyle I’ll never walk away from. The feeling of security and freedom I have right now is incredible.

Q: In your book you mentioned that you saved 75% of your income while you were paying off your debt. What are some steps you took to save money?

Joe: I learned to make things last longer and repaired things around the house on my own. I used duct tape on my car to patch a hole. When I went out with my friends, I brought a flask to cut down on alcohol expenses. I always brought my own lunch to work and I continue that frugal habit these days. I didn’t go to any movies and I didn’t buy new clothes. My favorite pair of shoes had holes in them but I kept on wearing them. I still haven’t even replaced them yet even though I have the cash to do so.

Q: Did you also take steps to increase your income?

Joe:  I tried finding extra work on the weekends, like pedi-cabbing, which didn’t quite work out. But I didn’t let that set back discourage me. I kept trying different things. My buddy and I started our own landscaping business on the side, which enjoyed some moderate success. I got two roommates from Craigslist. I also sold a bunch of stuff on Craigslist, like my iPod, second car, motorcycle, bicycle, and a pair of Burberry reading glasses I had since graduate school.

Q: How did you manage to stay positive while making these lifestyle changes?

Happiness is something we choose. If you think about it, most Americans have it pretty darn good. We’re a prosperous nation. It’s easy to compare yourself to other people around you and think other people have it better than you based on what they have, and that you don’t deserve happiness until you are driving this car or going on this luxury vacation. But at the end of the day if you have your health, and your basic living needs are met, what is so bad about life? Why can’t we choose to be happy?

Q: Was it hard finding friends who understand your frugal mission to pay off your student loans?

Joe: Not at all. My friends all stuck with me. They understand I’m going on a new journey.

Q: How about dating? Did you have to make any adjustments?

My debt payment experience improved my dating life. I used to take dates to expensive restaurants — it was kind of a crutch. But now I focus more on frugal shared experiences, like hiking, swimming, getting some bagels or just hanging out. I no longer rely on expensive restaurants to impress dates. This change has forced me to be more vulnerable and open, making me a better date. As a result I’m meeting great people who share my values.

Q: In your book you talked about how Facebook could be bad for you wallet. Can you tell us why?          

Joe: Some people treat Facebook like a product catalog. They use it mainly to post about stuff they own or stuff they want to buy. These people are overly concerned with consuming to keep up with the Joneses. Don’t fall into that trap. Try not to focus on those status updates on Facebook.

Instead, you should use Facebook to share experiences. For example, one of my favorite hobbies is rowing, and I love posting a picture or a status about a great practice on the water. I like sharing the fact that I had a great experience exercising with friends in the beautiful outdoors, and that I did something that made me happy. Sharing my happiness about this simple experience feels much better than posting a picture of an expensive gadget or a luxury vacation.

Q: Let’s say someone wants to get started on the same journey as you did. What is the very first step they need to take?

Joe: Decide why you want freedom — imagine your life without debt. Consider all the concrete benefits of a debt-free life. Would you act, think, or feel differently if you didn’t have a huge loan payment every month? Don’t just think about it. Actually sit down and write a list.

For example, my personal list of why I wanted to be debt-free included:

  • Avoid paying all that interest.
  • Save for my future kid’s college education.
  • Have the freedom to get off the corporate rat race and maybe open my own business.
  • Get more out of life by traveling (frugally, of course!).

I thought about this list often while I was paying down my debt and referred to it whenever I needed a bit of extra will power.

Q: Where did you get your best financial tips from?

Joe: My parents. They are great role models. When I was five they gave me a long list of chores and paid me a small allowance. If I wanted to buy a toy I had to save up my own money. I had a savings account when I was seven, and when I turned 12 they told me to invest in CDs for a better ROI.

Earlier I talked about fixing things around the house. I got that from my dad. He does most of the home repair work himself — plumbing, electrical work, woodwork, you name it. He taught me to be self-sufficient. My mom was an expert grocery shopper. She would spend entire Saturday mornings cutting out coupons out of the newspaper. She also refused to buy me name-brand clothing. All of this stuck with me. They taught me that saving money is not rocket science.

Q: Here’s one of my favorite quotes from your book:

“My mission to pay down my debt was not a means to an end, but a means to a beginning. I didn’t become debt-free so that I could take a vacation for the rest of my life. I paid off my debt so I could better understand my true purpose in life.”

Can you tell us more about what true purpose you’ve found in your life?

Joe: Absolutely. This whole experience has given me a new mindset about my life and my relationship with money. I love my life and I love my work.

I’m no longer a guy who works 80 hours a week, always looking for a promotion, trying to make money so he can go out and buy more stuff. Now I work 50 hours a week at a job I love, and this change has allowed me to enjoy my life — which is something I wouldn’t have done if my debt didn’t force me to rethink my priorities in life. My frugal life style allows me to draw a clear line between work and life. I’ve reached a good balance.

This interview excerpt only provides a brief overview of Joe's journey. If you want to learn more about Joe’s debt fighting strategies, I highly recommend his book Destroy Student Debt: A Combat Guide to Freedom. It is only $2.99 and free for Amazon Prime members. It is one of the best personal finance books I've read this year.


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