A Case of the Financial Blues

  • kuroshiro

    Posts: 786

    Aug 13, 2011 12:09 AM GMT
    I just seem to keep rolling with the Debbie Downer threads lately. icon_sad.gif

    At the sake of losing my sanity, I was curious as to whether people have any sound advice on a few things. I'm currently in quite a bit of debt. How much you ask? If I were to aggregate everything I'm looking at $101,000. I'm 25 years old... this shouldn't be. Mind you, a HUGE portion of it is education loans but let's just say that a part of it isn't feasible to... defer.

    I've recently gotten a full time position with my current employer and will be switching over to a graveyard shift next week Saturday. I'm happy because I'll not only have a full forty hour work week but time and a half on Sunday plus overtime and what not (plus a dollar differential for working overnight). But, here's my sticky situation I'm trying to sort out: I'm trying to save money. Ideally, I'm trying to take $100 from my check each week and put it into a bank account that I can't really tough (Hello ING Direct).

    That's all fine and dandy, but trying to figure out what that leaves me with every week is a tricky situation. Currently I make around $240 a week. This isn't really stellar at all. I slap almost all of it on medical bills and expenses that are always piling up. I have very little to work with for groceries in the end so you can see why I'm itching to save. The reason why I want to do this is to pretty much trick myself into living within my means... because I'm horrible when it comes to money. If I have it, I spend it on needless things... which I regret later on. Mind you, my current predicament has been one hell of a learning lesson for me and I've come a long way. My needless purchases are pretty much zero. Save for stuff at work that is. Damn grocer.

    Anyways, I'm not sure what to do. I have medical bills, one credit card (maxed out), outstanding debt with my university (currently at a creditor), plus a HUGE monthly payment I owe Sallie Mae every month. The only good thing is my car will be paid off by the end of the year so that'll free up $300 bucks a month to put towards my school loan with SM. So what do you think I should do? Should I forgo any sort of savings account and just put as much down on my bills as possible and THEN save or should I try and make further concessions elsewhere by just slowly chipping away at medical bills and what not with the minimum possible amount?

    I'd love to get a second job, but unfortunately I don't know many that would allow me to work from home... especially since I'd be too exhausted after 8hrs at work (overnight) plus time at the gym afterwards. It's a very frustrating situation for me and when my entire paycheck goes out for bills, I'm insanely frustrated until I get paid again because I wish I had more money to put towards them.

    Hope some people have a spot of advice =)
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    Aug 13, 2011 12:15 AM GMT
    Pay off the debt! Hopefully you dont need much to live off of but pay all the debt off as fast as possible!

    Then start to save, then save for retirement.
  • kuroshiro

    Posts: 786

    Aug 13, 2011 12:32 AM GMT
    I'm trying to plug away at it as best as possible. My "full" monthly payment with Sallie Mae is $520. Without interest that's nearly ten and a half years. Sadly that won't be disappearing anytime soon. I'd love to just fucking double that shit and get it done in like... 5 or 6. I'm already trying to save for retirement as best I can. It'll probably be 5% of my paycheck (~$25/week).

    My "savings" plan is pretty much my "get the hell out of my parents house and out of the area" fund (aka move closer to someone I've grown akin to). New place, better job prospects and better debt bailing. Then again there's always the Marines like I'm trying to get into... ~_~
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    Aug 13, 2011 12:34 AM GMT
    kuroshiro saidI'm trying to plug away at it as best as possible. My "full" monthly payment with Sallie Mae is $520. Without interest that's nearly ten and a half years. Sadly that won't be disappearing anytime soon. I'd love to just fucking double that shit and get it done in like... 5 or 6. I'm already trying to save for retirement as best I can. It'll probably be 5% of my paycheck (~$25/week).

    My "savings" plan is pretty much my "get the hell out of my parents house and out of the area" fund (aka move closer to someone I've grown akin to). New place, better job prospects and better debt bailing. Then again there's always the Marines like I'm trying to get into... ~_~


    Not a bad idea, there is only so much advice I can give you because of my job (Financial planner here, so everything I say gets me in trouble) but dont starve yourself, and being out of debt in 10 years really isnt that bad. It will happen before you know it.
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    Aug 13, 2011 12:34 AM GMT
    I'm sure you know about this, but suzeorman.com might be of some help to you. She comes on TV every Saturday night on CNBC. Can you afford cable? I don't see a lot of posts on RJ about people needing financial advice, so I just thought most gays are better off than me. I do okay only living on my social security, plus a part time job.

    Pay off the credit card, have an 8 month income emergency fund. If the interest rate on your college loan is decent, just pay it as it comes. Once you have the 8 month emergency fund (if make $1000 a month, you need $8000 in your emergency fund -- this can really help you instead of relying on credit cards in an emergency), then start paying as much as you can toward your debt. I keep a budget on my computer that I pay strict attention to. I wouldn't worry about retirement money for another 5 years.

    I think it's wise to reward yourself at least once a week, but be conservative. Shop the dollar stores for cleaning items and personal hygiene.

    For cooking at home I like to use a rice maker/steamer combination. You can cook rice, fish/chicken, and veggies all at the same time. It's quick, easy and nutritious.

    Will you have health insurance on your new job? Hopefully so.

    A close family member or a couple of good, close friends can help you with emotional support.

    Good luck. At least you are seeing the need to do something, rather than continuing to charge.
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    Aug 13, 2011 12:34 AM GMT
    Pay the debt off. Saving now is crazy with interest rates being so low.

    I hate to say this, but if all medical offices are like mine (i.e. menacing officially but ultimately lenient), you're better off negotiating a debt-reduction deal with them. We would rather have some revenue (less than originally billed) than no revenue at all. Yes, we've sent people to collections, but I can count them on 1 hand. Hospitals are a different beast altogether--pay them off ASAP.
  • Profire

    Posts: 224

    Aug 13, 2011 12:45 AM GMT
    I gotta ask...what kind of degree/work do you do that you you have $100k in debt and make less than $40k a year?

    My first recommendation would go to a non-profit organization to see if bankruptcy is an option. If all your debt is government backed student loans than, I believe, you don't have much if an option.

    2nd. Get a second job. If you work all night than you have lots of time to work during the day. I didn't say it would be fun or enjoyable or that you are going to be awake and spry, but you have to bring in more income.

    3rd. Reduce your expenses. Sell the car, take the bus, ride a bike, etc. Sounds like your car is fairly new since you are still paying for it, so there might be some value. Buy a cheaper car, or better yet, take mass transit or bike. Additionally, get a roommate to share expenses. Vacations will minimal for a while. Anything to redue your monthly expenses.

    Lastly. Put a small amount of money away for both retirement and emergencies. With regards to retirement, the mone you put away now has a much greater affect to your retirement than money you will put away later in your career due to compounding. With regards to emergencies, you need to have some money out aside for the normal emergencies such as new tires on the car, surprise bill you weren't expecting, water heater busted, etc. If you don't have an emergency fun it can put you back a few steps in your credit payoff plan.

    One last recommendation. You need to have an outlet and/or support system. If you don't have support for your efforts and goals you will fall back to spending. Plus, if you aren't having fun and enjoying life, you will forget about about your bills and splurge, thus you need to have a life and do thing that you enjoy.

    Good luck
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    Aug 13, 2011 12:48 AM GMT
    Here is whatt I would do if I were you.

    Save any money you possibly can wether it be $1 a week or $100 a week, and do not touch that money. This savings will start the process of you having an emergency fund. If you do not accumulate this money you will continue to live paycheck to paycheck, because car breakdowns, medical bills, and emergencies do not ever stop in life. There is always something new to pay for! Trust me I have learned the hard way. Pay off the credit card debt, and car debt as soon as possible then work on the college loans. College loan interest is a tax deduction, and will help you get a bigger rebate come tax season. The next thing you I would suggest you are not going to like too much.....get a second job. The money you make is not a lot to live on. Without increasing your income with a second job it will be a really slow and painfull process getting out of the debt, and eventually getting your own place. If you go into the marines make sure they pay off your college loans. They have the ability to do this so don't take no for an answer! Hope this helped a little.

  • kuroshiro

    Posts: 786

    Aug 13, 2011 12:57 AM GMT
    Well, I've talked with my doctors and eye care people and they're more than willing to work with me based on my income. They've all told me that even if I did $10 a month that'd be perfectly acceptable, just so long as you are making an honest effort to pay.

    As for other financial expenses: I moved back in with my parents. I hate it, I have no me time really so it makes life stressful. I don't have any sort of love life so that's another thing I don't have to worry about (both financial and emotionally) so it's really just education loans, car loan and insurance, credit card debt and medical stuff.

    I gotta ask...what kind of degree/work do you do that you you have $100k in debt and make less than $40k a year?


    The reason for my 100K+ debt situation came as a result of my ex telling me I need to get the hell out of my home environment. I was suffering greatly as an individual and we were as a couple. I applied for an apartment on campus and took out WAY more money than I needed to in order to live. I don't blame him for doing it since he held nearly all of my extra money for me when we were together. My degree is in Linguistics and Japanese. I was the only student in my Japanese class that did not get to study abroad therefore my proficiency in the language was weaker in some areas than others. Even though I've done ("illegal") translation work on the side, I can't use it as source work when applying for translation related positions.

    My first recommendation would go to a non-profit organization to see if bankruptcy is an option. If all your debt is government backed student loans than, I believe, you don't have much if an option.


    Unfortunately I'd still be stuck paying my student loans. I have about $1,600 left on my car (It's a Mazda 3 '0icon_cool.gif so once that is done I'm fine for major expenses.

    2nd. Get a second job. If you work all night than you have lots of time to work during the day. I didn't say it would be fun or enjoyable or that you are going to be awake and spry, but you have to bring in more income.


    True. Although finding a secondary job that will pay relatively well and not be a waste going to gas wise in the area isn't easy.

    3rd. Reduce your expenses. Sell the car, take the bus, ride a bike, etc. Sounds like your car is fairly new since you are still paying for it, so there might be some value. Buy a cheaper car, or better yet, take mass transit or bike. Additionally, get a roommate to share expenses. Vacations will minimal for a while. Anything to redue your monthly expenses.


    I live with my parents so thankfully they aren't charging me anything other than $20 a week or so (at the moment).

    Lastly. Put a small amount of money away for both retirement and emergencies. With regards to retirement, the mone you put away now has a much greater affect to your retirement than money you will put away later in your career due to compounding. With regards to emergencies, you need to have some money out aside for the normal emergencies such as new tires on the car, surprise bill you weren't expecting, water heater busted, etc. If you don't have an emergency fun it can put you back a few steps in your credit payoff plan.


    Yeah, I've already had quite a few problems crop up that I wasn't able to do anything about due to zero savings.

    One last recommendation. You need to have an outlet and/or support system. If you don't have support for your efforts and goals you will fall back to spending. Plus, if you aren't having fun and enjoying life, you will forget about about your bills and splurge, thus you need to have a life and do thing that you enjoy.


    Easier said than done... people don't understand financial situations until they're in them themselves. My friends are like "oh well you can come out for a drink or two with us, it's not that much." when drinks are like $7 + cost of gas wasted getting there, etc.

    But thanks for the advice =)
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    Aug 13, 2011 1:03 AM GMT
    saving is laudable but not very realistic looking at your numbers, with living expenses and servicing your debt load.

    Forget trying to save for a while and try to double up on your credit payments (at least double the minimum monthly payment) and try to stop using it completely.

    Your minimum payment pays that month's interest; if you double it, the second amount goes to the principal, so your next month's bill will have less interest added. you will slow the GROWTH of the debt, and your minimum payment will drop each month. but this works only if you can not incur more charges.


    Be sure you know how interest is applied on your credit card and the order in which payment is applied:

    1. Interest first

    2. charges

    3. THEN cash advances: That means that cash advance will keep having interest tacked onto it until EVERY OTHER charge is paid off in sequence. to zero.

    Any charge goes back to the first on that priority list. (so as long as you have any balance and are using it, you will nevdr psay off the cash advance at the bottom of the list (that you mighyt have taken out two years ago from an ATM.

    And this is the Credit Trap. It is explained in full in the little Cardholder Agreement that you get (but no one ever reads). They can change the agreement terms at their discretion, as long as they notify you, which they do with little inserts that come in your bill (which people often throw away without reading).

    As soon as you can get through three months without having to use your credit card, start saving.


    In the meantime -- consider banking with an institution that offers a "Bank the Rest" savings program attached to their debit cards.

    Know what kind of banking you need . Do you bank online or do you still use cheques? If you have not looked at the terms and fees of ytour account(s) in a while, take a look at them and see if you can get a better deal with another bank.

    Consider transferring your existing credit credit to a new card with another bank with a different product. Those are common hidden savings that we often fail to revisit often enough.

    When is the last time you sat down wih a banking officer? Make an appointment with your bank for advice. They do that kind of thing all the time.






  • Profire

    Posts: 224

    Aug 13, 2011 1:07 AM GMT
    My advice wasn't meant to be taken literally.
    In simple terms: increase your revenue, reduce costs, have something set aside for emergencies.
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    Aug 13, 2011 1:07 AM GMT
    kuroshiro saidWell, I've talked with my doctors and eye care people and they're more than willing to work with me based on my income. They've all told me that even if I did $10 a month that'd be perfectly acceptable, just so long as you are making an honest effort to pay.


    OMG, those are the exact words of my office manager! icon_eek.gif

    Doctors are such pussies at debt collection. icon_lol.gif
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    Aug 13, 2011 2:16 AM GMT
    I definitely don't want to hijack the thread... But does the "your salary should match your age" thing still apply today? (i.e. if you're 30, you should be making at least 30K, 40=40K etc.)

    Because I just had this horrible realization that I am not making enough money -- it's no wonder I am in so much debt! But unlike the OP, I will not have the option of getting a second job, because I am managing a family business, so technically I am self-employed... icon_sad.gif

    Anyway, don't mean to change the topic, thanks.
  • conservativej...

    Posts: 2465

    Aug 13, 2011 2:33 AM GMT
    So exactly what does a college educated person do to earn $240 per week?
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    Aug 13, 2011 2:34 AM GMT
    How much of the debt is student loans? How much of it is consumer / medical bills not including your car because you can't bankrupt that?

    What is your credit score fico score? Do you think your credit is good or bad?

    Do you have health insurance now that you are getting this new position?
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    Aug 13, 2011 3:14 AM GMT
    Famous words directly from the mouth of my attorney: "STOP PAYING SALLY MAE!"
    They are a scam.

    That is all. icon_biggrin.gif
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    Aug 13, 2011 3:45 AM GMT
    Most of us were duped by the college loan thing. We live and learn. And the gov ain't gettin' a penny of the 100 long I owe.
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    Aug 13, 2011 4:23 AM GMT
    JackNWNJ saidMost of us were duped by the college loan thing. We live and learn. And the gov ain't gettin' a penny of the 100 long I owe.
    Exactly. College loans are sooooo fucking easy to get out of.
    I always laugh at people who are still paying off their loans 20 years after college...and yes, I laugh in their face for being so stupid. icon_lol.gif
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    Aug 13, 2011 4:32 AM GMT
    paulflexes said
    JackNWNJ saidMost of us were duped by the college loan thing. We live and learn. And the gov ain't gettin' a penny of the 100 long I owe.
    Exactly. College loans are sooooo fucking easy to get out of.
    I always laugh at people who are still paying off their loans 20 years after college...and yes, I laugh in their face for being so stupid. icon_lol.gif


    how about having some integrity? it's assholes like you guys that have created the current mess the US is in.
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    Aug 13, 2011 4:58 AM GMT
    ScottsSoHot said
    paulflexes said
    JackNWNJ saidMost of us were duped by the college loan thing. We live and learn. And the gov ain't gettin' a penny of the 100 long I owe.
    Exactly. College loans are sooooo fucking easy to get out of.
    I always laugh at people who are still paying off their loans 20 years after college...and yes, I laugh in their face for being so stupid. icon_lol.gif


    how about having some integrity? it's assholes like you guys that have created the current mess the US is in.
    No, it's asshole like them who created it.
    When you're paying regularly and on time for A WHOLE FUCKING YEAR and payments keep getting HIGHER EVERY FUCKING MONTH because of compounded interest, you eventually realize that student loans are truly a scam.

    It's people like YOU - who are mind-fucked by the system - that caused the economy to crash. If people would stop paying the scammers, they would stop scamming.
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    Aug 13, 2011 5:02 AM GMT
    paulflexes said
    ScottsSoHot said
    paulflexes said
    JackNWNJ saidMost of us were duped by the college loan thing. We live and learn. And the gov ain't gettin' a penny of the 100 long I owe.
    Exactly. College loans are sooooo fucking easy to get out of.
    I always laugh at people who are still paying off their loans 20 years after college...and yes, I laugh in their face for being so stupid. icon_lol.gif


    how about having some integrity? it's assholes like you guys that have created the current mess the US is in.
    No, it's asshole like them who created it.
    When you're paying regularly and on time for A WHOLE FUCKING YEAR and payments keep getting HIGHER EVERY FUCKING MONTH because of compounded interest, you eventually realize that student loans are truly a scam.

    It's people like YOU - who are mind-fucked by the system - that caused the economy to crash. If people would stop paying the scammers, they would stop scamming.


    bitch says what?
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    Aug 13, 2011 5:05 AM GMT
    ScottsSoHot said
    paulflexes said
    ScottsSoHot said
    paulflexes said
    JackNWNJ saidMost of us were duped by the college loan thing. We live and learn. And the gov ain't gettin' a penny of the 100 long I owe.
    Exactly. College loans are sooooo fucking easy to get out of.
    I always laugh at people who are still paying off their loans 20 years after college...and yes, I laugh in their face for being so stupid. icon_lol.gif


    how about having some integrity? it's assholes like you guys that have created the current mess the US is in.
    No, it's asshole like them who created it.
    When you're paying regularly and on time for A WHOLE FUCKING YEAR and payments keep getting HIGHER EVERY FUCKING MONTH because of compounded interest, you eventually realize that student loans are truly a scam.

    It's people like YOU - who are mind-fucked by the system - that caused the economy to crash. If people would stop paying the scammers, they would stop scamming.


    bitch says what?
    Bitch says if you're paying Sallie Mae, you've bought into the scam.
    Have an attorney read over the "agreement" you signed. It's not legal.

    PS. Basically, I got over $20K of free money. icon_biggrin.gif
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    Aug 13, 2011 5:22 AM GMT
    Coming from a 50 year old man that was in your shoes, at your age.... Pay off the credit card debt first. Then build a small savings for emergencies. Stay with the parents until at least the credit card debt is taken care of.

    Cut up your credit cards. You can always use debit cards instead. We only use debit cards.

    If you are making only 240 per week, you need to increase your income by either finding a new higher paying job or getting a second job. Yeah.. you will be tired and you may have to reduce your gym time. You can even deliver pizza and make a lot more than what you are making now.

    The most important thing is to make a budget and stick to it no matter what.

    If you are buying your "lunch" when at work, stop. Start cooking and taking your meals to work with you. Completely cut out the restaurants until you get the credit card debt and car payments eliminated.

    Worrying about savings and retirement is a good thing. But when you make 40K or less, have over 100K in debt and you're only 25, forget the fricking retirement. Get your debt under control first. Get your income up while reducing expenses. When you are debt free, you will then be able to save a lot more for retirement and do just fine.

    Good luck. You can do it. The problem is that we have an entire society that is brainwashed into believing that you can't live or get ahead without debt. That's just BS. My dad always said, "If you can't pay cash, you can't afford it." I live my life the same way.

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    Aug 13, 2011 5:29 AM GMT
    paulflexes said
    ScottsSoHot said
    paulflexes said
    ScottsSoHot said
    paulflexes said
    JackNWNJ saidMost of us were duped by the college loan thing. We live and learn. And the gov ain't gettin' a penny of the 100 long I owe.
    Exactly. College loans are sooooo fucking easy to get out of.
    I always laugh at people who are still paying off their loans 20 years after college...and yes, I laugh in their face for being so stupid. icon_lol.gif


    how about having some integrity? it's assholes like you guys that have created the current mess the US is in.
    No, it's asshole like them who created it.
    When you're paying regularly and on time for A WHOLE FUCKING YEAR and payments keep getting HIGHER EVERY FUCKING MONTH because of compounded interest, you eventually realize that student loans are truly a scam.

    It's people like YOU - who are mind-fucked by the system - that caused the economy to crash. If people would stop paying the scammers, they would stop scamming.


    bitch says what?
    Bitch says if you're paying Sallie Mae, you've bought into the scam.
    Have an attorney read over the "agreement" you signed. It's not legal.

    PS. Basically, I got over $20K of free money. icon_biggrin.gif


    see my previous post - ZERO integrity
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    Aug 13, 2011 5:32 AM GMT
    ScottsSoHot said
    paulflexes said
    ScottsSoHot said
    paulflexes said
    ScottsSoHot said
    paulflexes said
    JackNWNJ saidMost of us were duped by the college loan thing. We live and learn. And the gov ain't gettin' a penny of the 100 long I owe.
    Exactly. College loans are sooooo fucking easy to get out of.
    I always laugh at people who are still paying off their loans 20 years after college...and yes, I laugh in their face for being so stupid. icon_lol.gif


    how about having some integrity? it's assholes like you guys that have created the current mess the US is in.
    No, it's asshole like them who created it.
    When you're paying regularly and on time for A WHOLE FUCKING YEAR and payments keep getting HIGHER EVERY FUCKING MONTH because of compounded interest, you eventually realize that student loans are truly a scam.

    It's people like YOU - who are mind-fucked by the system - that caused the economy to crash. If people would stop paying the scammers, they would stop scamming.


    bitch says what?
    Bitch says if you're paying Sallie Mae, you've bought into the scam.
    Have an attorney read over the "agreement" you signed. It's not legal.

    PS. Basically, I got over $20K of free money. icon_biggrin.gif


    see my previous post - ZERO integrity

    Really surprised to read this. Reminded me of an interview earlier today with a couple of the looters in London. They got their plasmas and said Christmas came early. Sad.