It was somewhat anticlimactic — a part of me wanted animated fireworks or a "Congratulations!" from the Department of Education website — but I've been feeling really good about it all week. This evening we're getting together with friends to hang out and celebrate.
Below is my entire payment history on my federal loans. It starts after I consolidated my loans. As you can see, I didn't pay the minimums for long: I paid off my private loan in May of 2012, and started paying this one off aggressively thereafter.
I mentioned in this post's title that I'm becoming a creditor. I've started investing with Lending Club. I first heard about Lending Club from Brave New Life, and most recently of course Mr. Money Mustache has taken the plunge. I decided that now my excess income has nowhere to go, I wanted to earmark most of it before it even shows up as a commitment device to keep saving and investing. One such commitment is $500 per month to Lending Club, which at $25 per note (the smallest amount you can invest at a time), means I can invest in 20 notes per month. This means I won't be fully diversified for quite a number of months, which is an additional risk. I am hoping to counteract this risk by being extra picky about which loans I fund — in this case, I intend to submit two or more questions per note I'm potentially interested in, and only fund the notes where I'm satisfied by the borrower's answers.
After building up a cash buffer of around $2k, I'm going to make a similar commitment of funds (probably via an automatic bank transfer) to a brokerage account. This way I won't burn a hole in my pocket, and I'll have spare cash around to jump on attractively-priced equities whenever an opportunity arises.
Paying off my loans is great, but it's one step in the journey. Now I can finally start focusing on asset accumulation which I've really been looking forward to. I'll also keep working on debt reduction since I feel like I won't feel truly free until I'm debt free. That will take a while but at this rate I know I'll get there.