Student loan debt can make financial independence feel impossibly far away. But carrying a large student loan balance doesn't necessarily mean you have to put every other financial goal on hold until the debt disappears.
Trusted Company Reviews personal finance expert Brett Holzhauer graduated from college with approximately $72,000 in student loan debt. In our conversation, Brett explains what that debt looked like early in his career, how he approached paying it down, and how his financial priorities eventually expanded from simply eliminating debt to investing and pursuing financial independence.
His experience also illustrates an important idea: Building wealth doesn't necessarily begin after every debt reaches zero. Depending on your circumstances, debt repayment, saving, and investing can become parts of the same long-term financial plan.
Key Takeaways
- Brett Holzhauer left college with approximately $72,000 in student loan debt, but that debt didn’t prevent him from pursuing long-term financial goals.
- Understanding your interest rates and repayment options can help you decide how aggressively to repay student loans.
- Student loan refinancing may lower borrowing costs, but refinancing federal loans means giving up federal borrower protections.
- Investing consistently can gradually shift your focus from eliminating debt to building wealth and pursuing financial independence.
Can You Build Wealth While Paying Off Student Loans?
Paying off student loans and building wealth don't always have to happen one after the other.
One of the best lessons from Brett's story is that personal finance doesn't have to be an all-or-nothing exercise. The mathematically fastest way to eliminate a loan may be to throw every available dollar at it. However, that approach can also delay saving and investing.
A more balanced strategy can often include making required student loan payments, building an emergency fund, contributing to retirement accounts, and making additional debt payments as you go.
For example:
Your loan's interest rate matters.
Paying additional principal reduces the balance faster and lowers the amount of interest you pay over time.
Borrowers with relatively low-rate debt may also decide that investing some available money toward long-term goals makes sense.
However, there isn't one correct formula for everyone.
How to Start Taking Control of Student Loan Debt
1. Start by understanding exactly what you owe.
List each student loan, its balance, interest rate, monthly payment, and whether it's a federal or private loan. That last distinction is particularly important because federal student loans can include protections that private loans don't.
2. From there, look at your options.
If you have private student loans with relatively high interest rates, refinancing could potentially reduce your interest rate, monthly payment, or repayment period.
However, it's important to note that refinancing federal student loans through a private lender eliminates federal benefits, including access to income-driven repayment plans and certain forgiveness programs.
You can compare our best student loan refinancing companies to learn how refinancing works and determine whether it's worth considering.
3. Then look beyond the debt itself. Decide how much you need for emergencies, whether you're receiving an employer retirement match, and what other financial goals matter to you.
The objective isn't necessarily to make the student loan disappear regardless of cost. It's to make intentional decisions about where each additional dollar can do its best work for your overall financial situation.
How Student Loan Repayment Can Lead to Financial Independence
Getting control of debt can create something extremely valuable: cash flow.
Money that previously went toward monthly loan payments can eventually be redirected toward savings and investments. Over time, investment growth and compound returns can begin doing more of the work for you.
That's where Brett's story moves beyond student loans and into financial independence.
One milestone on that path is known as Coast FIRE.
Coast FIRE generally means you've accumulated enough invested assets that, assuming sufficient time and investment growth, those investments could potentially grow to support your future retirement goal without requiring the same level of continued retirement contributions.
It doesn't necessarily mean you can stop working. Instead, reaching your Coast FIRE number can provide greater flexibility in how you approach work, saving, spending, and future financial decisions.
Related: Coast FIRE: What It Is and How It Works
Want to see where you stand?
Our Coast FIRE Calculator can help you estimate your Coast FIRE number based on your current investments, expected retirement age, and long-term assumptions.
The Bigger Lesson From Brett's Story
The most useful part of Brett's experience may not be that he started with $72,000 in student loans or eventually became focused on financial independence.
It's what happened between those two points.
Financial progress is typically defined as a series of decisions rather than one big money move. Paying a little more toward debt, improving your income, controlling expenses, investing consistently, and allowing time and compound investment growth to work can gradually change what's possible.
Your numbers won't look exactly like Brett's.
They don't have to.
The best question to ask is simply: What's the next decision that moves your finances in the right direction?
Frequently Asked Questions
Conclusion
Brett’s experience shows that carrying significant student loan debt doesn’t necessarily put FIRE retirement or other long-term financial goals out of reach. Your path can involve paying down debt, evaluating opportunities for refinancing that debt, investing consistently, and gradually shifting your focus from managing what you owe to building what you own.
Whether your goal is Coast FIRE or another form of financial independence, the important part is understanding your numbers and making deliberate decisions that move you closer to where you want to be.
About Author
Deane Biermeier
Deane Biermeier is a certified financial educator through the University of Minnesota and a respected authority in financial research, writing, and editing, renowned for his in-depth analyses and expert advice. With a distinguished career that previously spanned home improvement, real estate, and finance topics, Deane's role at Trusted Company Reviews focuses exclusively on finance. Deane has contributed to leading publications such as Forbes Home, US News and World Report, Newsweek Vault, and others. Since joining TrustedCompanyReviews.com in 2023, he has solidified his reputation as a crucial resource for clear, factual financial guidance.