How to Pay Off Student Loans in One Year

How to pay off student loans is a question that I would receive daily during my times as a finance advisor. It’s almost become like a pipe dream now right? You see these ads on social media that says “pay off student loans” and you are probably thinking that will never be your situation.

Well, what if I told you there was a student who paid off her student loan debt of $20,000 in one year!! Would I have your attention?

In Episode 85 of the Tuition Drop Podcast I actually interviewed this individual.

A Student’s Story

Kristy Epperson is a first generation student and in 2017 when she graduated nursing school she was in debt for the amount of $20,000. In just one short year she was able to pay it off completely.

A first generation student in the United States, Kristy wasn’t too knowledgeable about how the whole financial side of college worked.

She knew that it was expensive and knew that people took out student loans.

So she just thought that was what was expected of her….that she would take out Student Loans and just be paying on them forever, but it would be worth it because you get a degree.

Kristy was working quite a bit to pay off as much as she could while in school. She was trying her best not to accumulate more debt as she was going through school.

During her senior year of college she took a personal finance class just because she needed some extra credit hours. She said the professor was phenomenal and just wanted people to have a general understanding of finances.

She state that was one of the first times that she actually thought about her income and her finances even when she was making a lower income while working in school.

Kristy (who is from Ohio) attended a public college solely based on its affordability. She did indeed take out federal loans but she also worked at least one job throughout college. This included a job on campus which then gave her free room and board.

A-Ha Moment

Her “a-ha” moment came when after her college graduation she purchased a home. She states that:

“I didn’t know where my money was going. I didn’t have a plan for my spending or for my investing,” she said. “That’s when I realized that if something were to happen, if I were to lose my job or whatever, that I would be out of luck when it came to finances.”

That is when Kristy began to buckle down and began meticulously tracking and budgeting her money.

With her first real paychecks, she needed to figure out what she was going to do with her income. So that’s when she started to read financial books. She had no idea if she needed to be saving all my money or investing all of her money or like she ended up doing, putting it towards debt.

This was the foundation and Kristy sites as the catalyst for how to pay off student loans.

How to Pay Off the $20K in One Year

Armed with this newfound knowledge, what exactly was Kristy’s plan for how to pay off student loans? Also, how did she tackle a daunting amount of $20,000?

Here is her exact strategy!

Tracking Monthly Expenses

A tactic she received from Dave Ramsey’s famous book: “Total Money Makeover” Kristy began to track her monthly expenses very meticulously. She set up an excel spreadsheet that was pre-set for budgeting. She made great friends with her spreadsheet and made sure she was very familiar with every piece of data on there.

Silly Expenses

Kristy also realized that instead of throwing money away on “silly expenses” she could be paying down her debt. So that is what she started to do.

Eating Out

One of the toughest things she adds as everyone likes to go out to eat or go out and get coffee on a regular basis. She states that she still continued to go out to eat and get coffee but was just more selective about when she did it.

Lunch at Work

Once Kristy started working as a Registered Nurse, she was able to take advantage to use her badge to buy food at the cafeteria at work which came out of her account and therefore that was money she was never seeing on her excel spreadsheet.


At the beginning of each month, Kristy would withdraw cash for the month, divided it into envelopes and that was able to keep her more accountable. Cash is king!!!!


In her quest to become financially literate, Kristy continued to seek out knowledge by reading books and thinking of different and unique ways to maximize her paycheck.

Self- Discipline

Another tough one as self-discipline goes hand-and-hand with consistency. Kristy states that this trait was key and essential in keep her on task in her attempt to pay off student loans.

Establish Goals

Even though this is at the end of the list, this is where it starts. Kristy stresses how imperative it is to know and establish your goals. Her goals in this case was a student loan of $20,000.

Doing all the above really was able to have her paycheck stretch out and give her the cash flow needed to consistently pay off her student loan debt.

Tips for College Students

So we saw what Kristy did to pay off her student loan debt, but how exactly did she get there? Yes she had a total student loan debt of $20,000 but considering the average student loan debt is $38,390, which is a low amount.

So here are the tips Kristy had for college students.

Choose an Affordable College

It may not be your first choice and it may not be the “sexy” first but it may be the best choice. There are many hidden gems out there that just might meet your needs. In fact our last post talked about colleges that offer Free Tuition. Perhaps one may be out there that has the degree you are seeking.  

Student Loans are Just an Option

Don’t assume you have to take them just because it’s what the college or society tells you says Kristy. She’s right! Don’t be another sheep in the heard and know that you don’t have to be another in the long line of statistics that is up to their elbows in student loan debt.

Create your Own Financial Strategy

Planning and the research entailed in that planning is super important. You have to find a plan that works for you and your lifestyle ten years from now says Kristy. This may be hard for some people to conceptualize that think about. However, those that do will be separated from the rest.

Take on Extra Work

Work a job or maybe two. It’s a huge help. Look at jobs at the school where you can get some perks. The Federal Work Study program is something you may be able to take advantage of depending on your FAFSA results. Even those the coursework is going to increase, as a college student you also have time on your side. Make sure you are using that time effectively.  

Use Loans as a Last Resort

Kristy challenges people around taking loans for living expenses. If you work a full-time during the summer, you may not need to take out loans for those living expenses. Nevertheless, if you need to take out loans, then take out a very minimal amount. This gives you control and control is important when dealing with finances and student loans.

Kristy has become financially literate in just a short period of time. She is self-taught, read lots of books, and is now inspired.

She says: “I always tell people, ‘If I can do it, anyone can do it,'” she said. “I’m a nurse by trade. I have no financial background at all. I think with a little discipline people are way more capable than they think they are.”

There is hope for many of your out there. You see what Kristy did and it’s truly inspirational and shows us how we can ensure we are set up properly after graduation with our finances.

I hope everyone has found this to be of value. Thank you all for reading this and please leave a comment. I’d love to continue the conservation to hear about student’s plans to pay off student loans.

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