Please don't flame. This is a post requesting entry-level information and may come across as "Dumb"
Keep useless or troll responses to yourself, please. Funny jokes are acceptable.


I am hurting for money pretty badly. I have never touched crypto / Stocks / investments / etc

I will be using theoretical amounts of my income/debt to maybe help some of you visualize. Will be fake numbers, but the ratio of debt/wealth is correct.



I make 35k/year - Normal 8-5 Monday to Friday desk job

Am in Debt 13K~ ( 9k Consolidated Loan at 4.5% & 4k Credit Card at 29.9% )

I have no savings or cash - Living paycheque to paycheque

Monthly expenses are roughly 1500 ( Rent / Internet&Phone&Debt bills / Gas / Insurance / Food estimated ) - Car is fully paid off worth about 12k by the blue book, only pay monthly insurance and gas. Live in a small apartment for 700/month

Leaves me roughly a couple hundred bucks a month for everything else. Entertainment, shopping, fun etc.

I haven't bought myself any clothes for years, end up spending any extra money on food, or gym membership the odd case of beer or bottle of rum, and can't afford much else outside of this.



my debt amount has been sitting about the same for roughly 2 years now, and no matter what I try I can't seem to make it budge significantly.


If you have any advice for me that may seem reasonable or doable based on my situation I'd love to learn some. Would love to propose to my girlfriend soon but would like to do it when I'm in a position to be able to afford to live a little better than penny pinching...



Thanks in advance to anyone

This post was edited by Erodish on Dec 15 2021 11:42am

If you can't reduce expenses, you have to increase income. 29.9% is crippling. You will only make interest payments at that rate and never reduce the principal.

As unfortunate as it is, you need another source of income. That means weekend or evening work if you cant move up in your current position.

I assume you and your girl are living together if you are considering proposing. I would hope that she is splitting all expenditures with you. If you can maintain a small dwelling while suddenly splitting everything, it really helps with accelerating savings or reducing debt.

Can you add more to your consolidated debt to pay off your visa? At which point I would advise you cancel your visa for now. While its important to build credit if you're a person that cant control spending you could spiral back into debt quickly with a couple bad choices.

I would look at various lenders to eliminate that 29.9% ASAP for a lower rate.

There's no magical investment vehicles that are going to save you. You're not even in a position where you can invest since you have no disposable income and your interest is eating you alive.

You're stuck like many Canadians / Americans nearing the poverty line. Its a vicious cycle. Do not take on any more debt.


TLDR

1) Find a lender that will give you a loan at a lower rate so you can immediately pay off your credit card.
2) Cancel your credit card if possible. Building credit isn't worth the risk of you making bad decisions using it.
3) If your girl does not live with you, move her in. You're considering marrying her, it sound serious. Split all household expenses.
4) If you cant reduce expenses to the point where it eliminates the loan over a reasonable period of time you should pick up additional work on evenings and weekends.

This post was edited by SBD on Dec 15 2021 12:28pm

You aren't in a bad position really. This is pretty manageable.

See if you qualify for a zero interest promotion on a balance transfer card. You can usually get a 3% transfer fee then no interest for 12-36 months. Get that, and split your monthly payments so you pay it off 2 months early. Can also do this for part of the consolidated loan depending on how much you qualify for.

If not, sell your car and get a cheaper car that suits your needs and put the difference towards your higherest interest debt. If you are struggling for money there's absolutely no reason to keep equity locked up in your car.

Next, remove expenses. Don't have a room mate? Get one. Can shrink your apartment? Do it. Live within your means in a way that you can save and invest, no matter how low that is. You're sacrificing comfort now for comfort in the future. As your income rises so can your standard of living, but for now if you're having money trouble the answer is to shrink.

While you're doing this, go online and create a high interest savings account. Personally I use Marcus.com. It's only 0.5% interest, but it's not there to make money. It's there to be a cushion. Put $500 a month in no exceptions. This is your emergency fund. Additions stop being made when you have enough for 6 months of expenses, and restart when your expenses increase to stay at that number.

Any leftover money you have goes into retirement accounts. If your work has a 401K they contribute to then you contribute to it to get that match. Most places have a percent system, where they match up to like 5% of your wage. This is leaving money on the table if you aren't doing it. Go up at least to the point where your work stops matching, and go further if you can afford it.

After that, start looking to maximize your income. 35k a year isn't that much. Identify a field you can go into or move up in and start working on it.

imo the best thing to start doing...is learning to save

it doesnt how much but getting in a habit of saving instead of spending is crucial

1.) Refinance the high interest debt and do not add to the pot.
2.) Augment your income. Maybe there is some side gig you could do with your car?
3.) Consider another career.
4.) Sell the car, buy a cheaper one, use the delta to pay off debt. I drove a $500 98' forester for years, no shame.
5.) Look for a cheaper living arrangement, or alternative living arrangements.
6.) Shop for cheaper insurances, often can save ~15% on premium easy for comparable coverages.
7.) Do you really need the gym membership for exercise? Many cities have great parks to exercise in for free. I just get a membership in the winter.
8.) Hacky, you could get a 4g LTE hotspot unthrottled/unlimited and use that for your internet plan and phone service. I did this for a couple years and it worked out to $35/mo. Could take it anywhere too.
9.) Always buy used product. Grade A refurb phone that is ~2/3 years old is roughly 1/8 the cost of a brand new one on ebay for example.
10.) Learn to DIY as much as you can. Oil change, hair cut, basic handi-man work.

This post was edited by RedFromWinter on Dec 15 2021 03:58pm

just move in with your girlfriend and ask her boyfriend to pay off your debt

cut down your food to cheaper sources and focus on repaying the high interest debt down- literally can feed yourself eating cheap lentils and rice 2x a day and some cereal and milk.

paying off all debt should be your #1 priority. no point in investing. paying down the credit card balance alone will save you 29% - thats an additional 2.4k per year. focus on that first, then pay down the 4.5% debt. nothing else should be your goal right now.

stick to a budget - can you find cheaper insurance, phone, internet. if you are going into debt for entertainment, you are doing it wrong. maybe find a hobby that you can monetize instead of paying for fun - its costing you more in the long run as you rack it up on your cc.

and as other people stated here, try to increase your income - but - don't fall into lifestyle inflation trap with increased earnings.

This post was edited by Budgeting on Dec 15 2021 06:15pm

Imo there has been a lot of great information/suggestions presented in this thread so far!

I think if I were in your position my #1 goal would be to pay off that debt. What car do you have? The used car market is still pretty hot, you may be able to sell it higher than what blue book value is just because of current circumstances and pay all your debt off. If your gf moved in perhaps you can share 1 vehicle? On the other hand though you definitely need a 2nd source of income to get that debt paid off and start saving up for an emergency fund (I personally recommend a year of bills or rent set aside)

If you keep the car or get a cheap replacement I would look into driving or delivering for uber/lyft. Tons of people do this for side money and the best part is the flexibility so you could do it whenever you want. Whatever your extra income is - you should be dumping all this into paying off debt plus whatever else you can afford from your main job. Then next do the same thing for the emergency fund. This is important so you're not solely relying on the next paycheck to cover your bills but also if investing and/or trading is a goal of yours you don't want to liquidate your holdings to cover your bills in case you lost your job or couldn't work. I hope it helps, like I said lots of great stuff in this thread. It will be a grind but very rewarding once you accomplish some of these financial goals. Keep us updated and good luck

I just have to say wow and thank you so much for all the information and advice.

Taking a few of these terms to the bank meeting next week going to try and get that Credit card debt amalgamated into my consolidated loan. and avoid using the CC as best I can...

The gym membership was an expense that can be spared, I know my routine and can do most without the gym - it was convenient, and didn't attribute too much thought to it being a drain. But 80 bucks a month adds up.

Selling my Car I may look into, at least worth the thought or asking the question see what kinda realistic value it can get me these days.
It being fully paid off makes me hesitant to downgrade because it is still relatively new, (2015 in good shape, bought new), and have heard conflicting advice - Sell and use the money towards other more urgent bills, as well as not sell, and try harder with other methods. Downgrading to an older or "Shittier" for lack of a better word opens me to potential breaks or maintenance etc. Have been told I shouldn't need to worry about any real major repairs or replacement in my vehicle for some time. Will think about this one some more.

2nd side job is being looked into right now - Have tried to apply for jobs like doordash or skipthedishes, etc, but usually full and not hiring in my area.
I have a minor nursing degree and am looking into part-time or casual care work for nights or weekends, I have experience here and a good option to find more shifts without getting in the way of the ol' 8-5

I can very well get better with my food budget. I know it is my weakness and could solve a lot on its own. Have to say it's a pure willpower issue that I need to kick myself in the ass for.


Tons of other food for thought in here just wanna say thanks again.... I'll be sure to update with progress or if things start looking up.

Cheers all