How do you put together the finances for your travels, long-term or short-term? What do you sacrifice in order to save up the necessary cash? What's your best money-saving tip on the road? Share your money tips - and pick up a few - right here.

The student loan blues?

keifer94

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Joined: September 12th, 2008
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  • Added on: April 21st, 2009
I paid off my student loans at the most accelerated payment plan they offered, and I added a little more each check. This is saving me thousands in the future, even though paying on the slowest program was much cheaper and tempting. But, I made sure I paid the student loans off before I traveled and it feels great.
It sounds like you're chomping at the bit to go, if you haven't already. I would say slow down and take some time and consider all the money you will need to save and think of things like ATM and Foreign Transaction Fees and other hidden costs of a long-term trip.
But, on the other hand, you can defer the loans for about six months. However then you are making no payments and still earning interest. If you follow this route they give you the option of paying the interest only and I recommend you do that, IF you are going to defer the loans.

Jurori

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  • Added on: September 17th, 2010
It's been a while since anyone posted in here, but I figured I would reply anyway since this is a current concern of mine. I have about 35k in SL debt, and I've been trying to figure out how best to pay things off in order to get to my travels as quickly as possible. Sadly, no matter how I look at it, things will take at least a couple of years, whether I try to pay it all off immediately or not- because if I'm not putting money toward my loans, I'll have to save up extra for my travels so I can pay loans as I go! And really, I'd rather not do that.. I mean, what's the fun of having to pay off loans every month while I'm supposed to be focusing on traveling around? >.>

I was wondering if anyone's recently done/ is doing the whole "paying loans while traveling" thing... The only way I can see myself leaving any sooner is if I go off and teach English or something in another country... anybody doing that instead?

2wanderers

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  • Added on: September 20th, 2010
We created a trip budget which allowed us to travel while still paying loans, rather than delay the trip to fully pay them off first. I'm of the opinion that it was the right decision for us, even though it was certainly not the cheapest.

- At the time our jobs were somewhat disposable, and because we knew we wanted to leave, we weren't going to put a whole lot of effort into improving our careers. Our incomes have increased substantially post-trip, something that may have been delayed if we had stuck around home longer to pay off loans. Saving the extra $2000 we needed to carry the loans took a lot less time than saving the extra $30k+ to pay them off.

- The corollary of that is that it was an easier time to leave. The longer you stay in one place, the more responsibilities you tend to accumulate. Leaving when we did was undoubtedly easier than leaving substantially later. If we'd waited too long, we may never have taken an extended trip.

- I've discovered that for myself I prefer liquidity over low debt. This isn't directly related to the trip, but in general I'm averse to paying off low interest debt at a faster rate than necessary. Our student loans are cheap money, and the tax deductible interest makes them even cheaper.

I have continued to pay our loans at something close to the minimums, and have wiped out about 1/2 of them over the past 4 years since we got back. But I've also built up enough in cash and investments that I could pay off the other half tonight if I wanted to. But I choose not to because I like options. Having those savings allowed us to build a budget that gets my wife through law school, which she's just started a few weeks ago. If we'd paid off the loans in their entirety, we wouldn't have the assets to pull that off.

It's all about what works for you. While I'd love to see no debt on our balance sheet, it turns out that there's a lot more important things to me, and I have no regrets. I can certainly understand that zeroing that debt might be much more important to someone else.



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