As a dual-military couple, my husband and I used 7 strategies to pay off $40,000 of student loans in a year

• I inherited $110,000 in student loan debt when I married my husband and knew we had to pay it off.
• As a dual-military couple, we live one pay grade below our current grade and use the rest for debt.
• We also use just one of our Basic Allowances for Housing to pay our mortgage and save the other.
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When I married my husband, I inherited a not-insubstantial amount of debt in the form of his student loans. I accepted that this was pretty much par for the course; almost everyone I know has student loans (I was lucky to graduate without them). But our number horrified me.

After bloody dissection of our finances, it turned out that we owed $110,000, all student loans except for $5,000 in credit card debt. And even though we are both active-duty military officers, my husband would not qualify for Public Service Loan Forgiveness because the majority of his loans are Parent Plus loans in his father’s name, not his own.

I reasoned that, between our two military salaries and benefits, we could pay everything off in five years. But then, we found out we were expecting our first child. Suddenly “the money thing” took on a stronger sense of urgency.

We created an airtight budget, itemized every dollar we spent, made spreadsheets to track our progress, and forsook all unnecessary expenses. I read several books on personal finance (which I borrowed free from the public library) and scoured Military OneSource for opportunities to save more money.

A year has now passed since my husband and I had that first painful conversation about our finances, and we’ve paid off more than $40,000 in debt – twice as much as I’d predicted. Now we’re projected to pay the remaining balance by this time next year.

Here are some of the key ways we’ve maximized our military pay and benefits to accelerate our debt payoff.

We live one pay grade below what we currently make and save the rest

Basic military pay is determined by rank, grade, and time in service. The Department of Defense publishes charts that show the amount service members should receive each month based on this information. My husband and I use that chart to see what we would make at the next lower grade and plan our budget with that number in mind so that saving the remainder is automatic.

My last department head gave me this tip and it has saved my family hundreds of dollars a month. Plus, we only use one of our incomes for living expenses. The other goes to savings and debt payoff.

We use our Basic Allowance for Housing (BAH) to our advantage

BAH is a tax-exempt, US-based housing allowance for service members. The amount varies by geographic location and pay grade, but it’s usually enough to cover the cost of rent and more.

For my husband and me, a portion of my BAH alone covers our mortgage. We use the remainder, and my husband’s full BAH, to pay student loans and save for housing-related expenses like maintenance, repairs, and utilities.

We put our pay increases towards our debt

Military pay increases every year on January 1 based on the growth of private-sector wages and salaries. In the last 10 years, it has increased an average of 2.1% annually, which has resulted in an extra $80 a month for me, or almost $1,000 a year. I put that extra money towards student loans and never miss it.

We shop smart

We buy almost all our meat from the deep freezer at the commissary, where prices are steeply discounted on stock the store couldn’t sell, and our meal plan revolves around what we find there each month. This saves us at least $150 a month on groceries.

We also shop at BJ’s and Sam’s Club to buy staples we use frequently in bulk, like beans, rice, yogurt, and eggs. BJ’s offers discounted memberships for the military, so the savings are worth the small annual fees.

We also shop our base’s “free and for sale page” on Facebook for things like tools and household goods and have saved at least $1,000 on needed items doing this. These pages are easy to use and there is at least one in the area of every military installation.

We use free tax filing software

The Department of Defense provides MilTax, a free e-filing software that is “tailored to military life,” according to the MilitaryOneSource website. Through the site, military members can connect 24/7 with military tax consultants, a huge deal for large families and individuals with complex tax situations.

We applied for fee assistance

Child Care Aware of America offers fee assistance programs that help military families find affordable, reliable childcare. The Child Development Center (CDC) on base closed temporarily due to the pandemic, so we enrolled my son in a childcare center off-base – at more than twice the cost. Once our application is processed, the program will free up another $500 to pay off loans.

We always ask for military discounts

Many places offer military discounts if you ask, and the little money we’ve saved doing this is worth it. We’ve adopted the mindset that every cent counts, and it has added up to more than we expected.

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