I am a disaster!

[Ambitious_Andrea]

I need help. I am a full time student making 600 dollars a month and this is my monthly budget.

50 loan repayment ( minimum amount)
50 gym membership ( my only entertainment and hobby)
75 cell phone bill ( I lowered it to the bare minimum)
200 savings
75 visa payment
100 spending/ miscellaneous expenses
50 gas money

2850 Loan debt
1015 visa debt
1900 savings

The worst part is I'm 22 years old and I am studying a liberal arts degree working in a retail store. I feel hopeless and so behind in life. I cut up my visa and I am ready to grow up. Please help

[bjl584]

You aren't in that bad of a disaster as you think.

First, where is the $200 a month for savings going? How much do you have saved? Would it make sense to cut that amount back in half and put an extra $100 toward debt?

Your cell phone bill can be cut back more. Get a prepaid phone and pay as you go for $20 a month of need be.

Can you get more hours at your job? Retail always needs help, and the holidays are coming. More hours shouldn't be an issue.

Where is the $100 a month misc. spending going? You need to cut it back.

Why a liberal arts degree? You sound like you aren't happy pursuing it. Maybe you should change your major to something more marketable.

You only have $3800 in debt. Hardly a disaster. You can pay it back fairly quickly if you allocate all of your extra money toward it and vow to not get yourself back into debt again.

[HereForTheCheese]

You're in way better shape than most. Honestly. But debt can definitely be scary. How much do you have saved currently? I do think it's a good idea to build up a bit of an emergency cushion before going into debt repayment mode. It really depends on how much you have though.

Also, 100 on misc is not bad at all...no where else in the post was there anything about household products, toiletries, etc. I would assume that's where it's going. If it is just drinking money...well... then you probably do need to cut back

[Ambitious_Andrea]

I live at Home with my mother So I have no expenses other than the ones listed. My savings is at 2000 dollars. So would it be smart to throw all my extra money at my debts at this point? I'm just anxious to build up my savings because I compare myself to other people who have way more money in savings than me and I want to keep up.

Also for the 100 dollars a month on spending money.. It usually goes to gifts, eating out, clothes etc... I want to save but I want to live my life too but should I put those things on hold till I'm out of debt?

[bjl584]

I live at Home with my mother So I have no expenses other than the ones listed. My savings is at 2000 dollars. So would it be smart to throw all my extra money at my debts at this point? I'm just anxious to build up my savings because I compare myself to other people who have way more money in savings than me and I want to keep up.

Also for the 100 dollars a month on spending money.. It usually goes to gifts, eating out, clothes etc... I want to save but I want to live my life too but should I put those things on hold till I'm out of debt?

Your EF is fine sitting at $2000 if you are living with your Mom and have low expenses. Start putting all extra debt toward debt repayment.

Don't compare yourself to others. You have no idea what they have, and they might be lying or living a fantasy anyway. Focus on your own situation.

I would say that you don't need to put everything on hold, but find ways to cut back while still allowing yourself a treat here and there.

[scfr]

What is the "Loan Debt"? Student loan? What is the interest rate?

Are you starting your senior year?

[HereForTheCheese]

Nice job saving 2 grand. I would definitely take that 200/month and reallocate it towards paying off your debts with the avalanche method. IE highest interest to lowest interest.

[Permanent Temp]

This is what I would do. Since you are at home I would spend the EF on your debt. Pay off the Visa bill and then use what's left to lower the balance on the loan. Stop funding your savings for now until your out of debt. Then you will have 325 a month going toward your loan and can pay if off in about 6 months or so. After that you can use the 325 to refund your emergency account and maybe even open up a Roth and fund it a little.

I get that you want to have a life. I had that mentality at your age too and I had 7000 in credit card debt and 20K in student loans. If you cut back a bit on going out with your friends now and save that money instead to refund your emergency fund you'll be much better off to go out when you are debt free and honestly at the point you might not even want to when you see all the work it go to get there. The most important part is to change your habits so you don't end up there again. I went out when I was in school and I'm still paying for it at almost 30. My husband and I see people go out all the time but we don't we save and go out to eat somewhere nice maybe once or twice a month. In the end financial security is more important than a visa bill of times you can't even remember.

Also your liberal arts degree seems to be giving you stress. Do you have an option to change your major or add on a minor in something that might interest you and make you marketable? Or do a year certificate in something that interest you that can work in conjunction with your degree? Can you try maybe going to a temp agency and trying to get a different kind of job or something that you can use to help you be marketable? Can you go to a school counselor and see if there are anything internships or clubs you can join just try to take steps so make sure your not stuck in retail once you graduate? Best of luck to you!

[Blessed]

Dont be so hard on yourself. You are only 22. Congrats on saving the $2000.

I would put $1000 on your visa bill from savings. Once you pay it off quit using it unless you have the $ to go online and repay the bill immediately with budgeted $.

Start putting of what you were saving monthly on your student loan. Also add the $75 you were paying to Visa since it would be paid off.

Once the student loan is paid off start saving all the money you were paying on it. You can now use this savings to avoid more student loans if you will have more college expenses.


I do think you can reduce your phone bill and keep internet on it if that is what you have. Check out this link http://www.kittywireless.com/pageplu...plusplans.html. My whole house hold uses these guys.

I think your misc spending is fine.

[TBH]

I agree with others who say you are not doing badly! You are definitely at the right age to get a handle on these things.

Here's what I'd do.

* Pay off the visa right now out of savings. Keep the rest of the savings in case you have unexpected expenses.
* Pay the $75 that's currently going to the visa and the $200 that's currently going toward savings toward your student loan.
* Once that's gone put all that money toward savings.

I also agree with others that you need to rethink your liberal-arts-to-retail path. I also did a liberal arts degree, also worked retail, and then I ended up having to go to grad school to get a marketable skill. You don't necessarily have to do that. There are lots of things you can do that would make decent careers. A paralegal degree is usually 2 years, and that's good work. If it's too late to change your major or add a minor that will give you some practical marketable skills, I'd look into short certificate programs at a community college that will give you a skill that will pay more than retail work. Medical billing? Some kind of technician job? Liberal arts degrees are great and make well-rounded well-read graduates, but you can't eat that.

One other thing--I think $100 a month spending money is reasonable for you. You do need to pay off debt, build your savings, and most of all, increase your job prospects. But you are young, and you're taking control of your money and I think you can afford to spend that much on having fun and on small things you need like clothes and so on. Really it's only $25 a week. That's not that much. Many people in your shoes would be spending ALL their money. If you keep saving and keep paying off debt, I don't begrudge you your $25 a week to enjoy. If you don't spend a little, you might burn out on saving and debt payoff and you might get yourself into worse trouble.

Keep at it! You are doing great.

[hamchan]

Liberal arts degrees are great and make well-rounded well-read graduates, but you can't eat that.

This. I have a liberal arts degree too, and I did not get out of retail work until I went back to school for cosmetology. I made more money with a 5 month and $3500 certificate than I ever would have with my degree. Since then I have also gotten a massage therapy license and make even more. I honestly wish I had waited to go to college for liberal arts, or not have gone at all. I think it was valuable to my education level, but just did not pay off in the slightest in terms of income.

[asdf]

Count me in with those who say you are in better shape than you think. Don't panic! I also agree with those that say to pay off the Visa right now with your savings. Once you get rid of that for good, you will also have an extra $75/month to allocate elsewhere.

As far as the liberal arts degree discussion goes, I'm on the fence until I know some more information--primarily, how much further do you have to go to get it? If you're on the verge of completion, you might as well complete it since you've already sunk time and money into it. Also, what will your major be? If you're serious about using this degree for a profession, then you should do some research as to what fields of work are the best for it. Getting a head start before you graduate certainly wouldn't hurt.

Finally, we all seem to assume that the "loan debt" is student loan debt. Is that the case? If so, do you anticipate that number to rise as you continue to study?

[ActYourWage]

50 gym membership ( my only entertainment and hobby)

Does your school have a fitness center? If so, those are usually available to full-time students. That would save $50 a month.

[TheKayla]

Yeah, you're not off that bad, you're doing way better than I was at 22, and you're doing much better than most of my peers now (I'm 24)!

It's great that you're putting any debt and finances as a concern at a young age though. It sounds like your budget is in check, just make sure you stick with it, and find even more savings where you can. I'd pay off that Visa with your savings right away, you're only paying interest on it. I'd then focus on your other debts while you have the opportunity of living with your mom. Get rid of that as soon as possible. Put any other misc income you get, from gifts, etc., to that as well. I always asked for money for gifts instead of things during college -- sometimes my relatives didn't listen -- but I got a bit more than if I hadn't specifically asked for cash. Once you have your debt paid off, or if you plan on moving out, then start racking up your savings again.

Perhaps try getting more hours at work, and if you can't, perhaps try something related to your major, like work study, tutoring, or paid internship. In the very least you can look for jobs that will have downtime and allow you to do your studies during that downtime. This will help you excel at school while still getting some extra cashflow. I know it can be difficult, but I worked full time in school, and it sure is possible. Take on extra hours in the summer at least, you should be able to go to full-time work then, and then pay down debts or save for the school year when you have to work less. You're really not that bad right now-- just remember to keep living frugally when you do get some extra money coming in.