Stop Whining about How Much Money Joe Mihalic Makes: He Made Sacrifices to Pay off His Debt

You may have recently seen the story of Joe Mihalic, a Harvard Business School graduate who paid off $90,000 in student loan debt in 7 months.

If you haven’t read the story, he graduated in 2009 with $101,000 in student loan debt.  He got a good job at Dell, and lived the lifestyle of someone in his position—he bought two cars and a house.  He regularly paid more than $1,000 a month on entertainment, and he dutifully paid $1,057 a month on his student loans.

After 22 months of making those $1,057 monthly student loan payments, he still owed $90,000.  Yes, he had paid over $23,000 in minimum payments, but only $11,000 of that money had made its way to principal.

Mihilac got angry then and vowed to pay off the debt in 10 months or less.  He sold one of his cars, his motorcycle, cashed in his retirement, cashed in an investment, and used his emergency fund.  Then, he gave up eating out and other entertainment; he didn’t buy clothes, and he didn’t go to visit his family at Christmas.  He missed two friends’ weddings.  He started a side job as a landscaper.  He found two roommates off Craigslist.  He wrote about his experience in his blog,

I find Mihilac’s store inspiring.  He got made, got to work, and made the debt go away. 

What I find annoying are those who dismiss his achievement by saying, “Sure, he could do it because he has an MBA from Harvard and he made $100,000 a year after taxes.  I could do pay off all of my debt too if I had those resources.”

I don’t think that.  I think he made significant sacrifices and reaped a great reward—he is now debt free.  Yes, he makes more per month than we do, but his debt was also greater than ours.

Honestly, our debt is about equal to our income for a year, as was his.  We have kids and he doesn’t, but that just tells me he was smarter to tackle this all before he had dependants.

Could you reject all consumerism and not set foot in a restaurant or a movie theater for 7 months?  Could you avoid buying clothes and having a hole in your shoe?  Could you miss out on two friends’ weddings?  Those are memories you will never get to make and events you will never get to share.  Could you work at a Fortune 50 company and start a side job as a landscaper?

He did what he had to do to get it done.  I congratulate him for that, and I take inspiration from his story.

What do you think of Joe Mihalic’s journey to debt freedom?


  1. I think he is very inspiring. I too have college debt and we make sacrifices every day so they get paid off earlier then expected. No cable, no junk food, extra clothing in the winter, make our own food. He worked to pay off his debt. Isn’t that what everyone does? he just did it in 7 months apposed to 30 years! High five to him. OH and is he single?

  2. I love his story! Thanks for linking to it.

  3. It’s certainly an impressive feat. If I were in a situation where my debt were about as much as my annual income, I’d certainly take some drastic cost-cutting measures. I’m not sure whether I’d forgo weddings or other important life events, but I would try to make them as inexpensive as possible, and accept that debt repayment would go on a little longer in exchange for spending that money instead.

  4. $90,000 in one year is a ton even if you make $100,000. After taxes that $100,000 gross is no where near $90,000 net. Good for him and I’m glad he is getting some attention because it is well deserved.

  5. I thought it was a pretty inspiring story also. Even though he has a good income and no dependents, he made that debt go away quickly and aggressively. However, when I read the original story, he said that school loans are not like a home or car–“You don’t have anything to show for it.” There I disagree. An MBA from Harvard is a valuable asset, and I”m sure it helped him to land a six-figure job at age 26.

    It’s obvious he made financial mistakes, but so have most of us. I wonder if he could have lived more frugally while at Harvard. And of course, he burned through a lot of cash after graduation, but he is young and on a good track now!

  6. I think his story is amazing. Guess what? I have an MBA and a good job too. We have lots of debt. We’re not quite at the point Joe was at – we’re not willing to make ALL those sacrifices to get out of debt. I admire him for doing it.

  7. I loved his story and really connected with him. It was interesting to see how quickly his perspective on things like money and value change as he dove into this journey.

  8. Seriously says:

    You’ve got to be joking. A lot of his money came from his assets – selling a car and mike, taking money from his retirement account (which, btw, is a stupid thing to do). It would be a different ball game if he had paid his loans back a year after HBS, but remember he worked for two years before deciding to pay off his debt.
    And lets step back – he went to Harvard and he didn’t know how interest and principal on his loans were calculated? This is just a stupid publicity stunt and I can’t believe so many people fell for it.

  9. Renee Aldrup says:

    Not inspiring at all. You left out that he bought a flask and kept booze in it when he went drinking with buddies instead of buying drinks at the bar and tipping that hardworking bartender or waitress. He owned a house he could rent out. Did he as a single man need 2 cars and a motorcycle? Totally not impressed.
    He has no dependents, no ill health, etc. One week long hospital stay for a serious injury or illness can wipe a families’ finances out even with insurance coverage.
    You know what impresses me? My son, who will graduate college in May 2013 with his BSN in nursing. He worked hard enough to get and keep a full scholarship and several outside scholarships to pay for school. He’s been on the dean’s list every single semester. He will graduate with $2700.00 in student loans that he had to take out to cover his summer semester. Instead of moving out of our home he still lives here even though he is 21. He drives a paid for 2003 Neon. He shops at thrift stores when he needs something. And he doesn’t ask us for money. That’s impressive.

  10. BRowanheart says:

    I think they’re right — it has A LOT to do with the fact that he made 100k a year. And you can’t just assume that everyone who’s in debt has a job who’s salary is about equal to their debt.

    I’m 96k in debt, too.

    I make less than 30k a year — a LOT less. I’ve been working at friggen Macy’s since I graduated because there’s nothing else in the area that I can get without having 5+ years experience.

    I’m blessed because I don’t have to pay rent, or for health insurance, or car insurance, or food, because my mother is a cosigner on my loans and wants me to put all my money towards paying my monthly bills. Even then, I can’t afford anything else because all my money DOES go to my monthly bills.

    I’m not saying he didn’t sacrifice — I’m just saying that this scenario still only works if you make enough money in the first place. I mean, after all, he DID still pay rent and EAT, didn’t he? I couldn’t do that if I didn’t still live at home. I’d have to choose between eating, or shoveling money into the dirty mouths of Sallie Mae.

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