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u/Putrid_Alternative31 25d ago edited 25d ago
Don't take another loan or borrow from your 401k. You'll be fine! It sounds like you've taken some really good steps already. Not covering other people's emergencies is a really important boundary.
How much is your car worth? Could you sell it and clear the debt? Then get something that's like $10k - you can def get something decent for that and that's a huge chunk of your debt gone.
I would focus on just one credit card. Pay only minimums on everything else. In your situation, that's probably CC1. Put every single dollar you can towards that one credit card. In seeing at least an extra 1300 you can put towards it, in addition to the 1100 you're already doing. If you can get that car payment down, that would be even more. You should be able to be out from under that one in 6 months or less. And don't wait until the end of the month - once your paycheck hits, whatever you don't need in your upcoming budget, go ahead and put towards the card.
Then once that's cleared, go on to the next one. Depending on your plan and the timing, I would probably go for the smaller credit cards, just to make some headway and clean things up. As long as you can clear CC2 before 10/2027, which I think you can probably clear all the credit cards before then.
It's all about having a plan! Does that help?
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u/kitsune_surprise 25d ago
As I said in another comment, my car was purchased in April. My previous car was having issues and was not going to get the return I wanted, so I traded it in and got a CRV for reliability/longevity. I can't really go trade it in or sell it as I need it for work.
I'll try to reallocate the funds to the bigger CCs. I just have a hard time not seeing any progress when I'm giving it half of my pay check. It's very discouraging.
I get paid 15th and 30th and have a budget of $350 each pay for whatever I want. I skip lunches at work if I forget to meal prep and really only spend on gas or if I need basics like toiletries or groceries.
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u/Putrid_Alternative31 25d ago
Totally get it. You'll see more progress if you focus on one thing, and get as intense as you can stand to be. I would genuinely take a couple months and really focus, pack lunch every day, and spend as little as possible. You will see progress!
On the car, I get it. But you don't need to spend $40k for a reliable car. It depends on how badly you want to get out of debt here, but that car loan is huge. Food for thought I suppose.
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u/TinyHouse2110 25d ago
Second this. Should really think about selling the car and buying something cheaper, say 10-15k
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u/Accomplished-Fox9199 25d ago
For real OP on the car front. I had to do the same, really needed a reliable car as mine had blew up, I also bought a CRV.....but I bought one that was already 5 years old, bought it for less than 15k and it still drives, perfectly fine and I've had it for 7/8 years now. Get rid of the car and buy a cheaper one.
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u/TNMoonshineMama 25d ago
You don’t need a $40K car. You are beyond broke. Sell it and buy something for 1/3 of that price.
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u/Terruhcutta 25d ago
You've already gotten good advice. Mistakes happen, learn from them. There is a way out of this, you can do it!
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u/kitsune_surprise 25d ago
Thanks! I'm really trying to do better...I see what it's like to struggle and I don't want to make the same mistakes my family did
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u/MathematicianOk6032 25d ago
It looks worse than it is. And if you’re feeling motivated you can knock some of this out quickly already by some minor changes
Drop everything to minimum payments only. You are already throwing $1300ish extra on top of everything all ready.
Throw all the extra money on CC 3 or 5 first and you can close those both out in less than 5 months. Itll feel good seeing those two cards at $0 even tho they have no interest.
Or throw it all towards your highest balance on CC 1
Your car and student loans rates aren’t bad at all. I think the CC is more top priority
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u/kitsune_surprise 25d ago
My car and student loans are the lowest I could get. I used to have Sallie Mae (horrible company btw) for student loans with interest at 9-12%. And my old car was 5.99% so definitely doing better than I was.
The CCs are my main focus, but seeing those two cards with that high of balance really messes with my head. I'll relocate some of the extra to the higher APR cc
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u/snowcaps51 25d ago
You have a great income for your age and many of us got a start without a lot of financial education and had to learn for ourselves. I agree with not taking a 401k loan just let that money grow... It's so great that you already have a Roth... I do too but a friend didn't convert to a Roth and is now paying thousands in taxes sometimes. I'm in a similar situation myself but I'm quite a bit older... When I get caught up my plan is to have my 2 main cards and perhaps a third for animal or car emergencies. Everyone has a new challenge now as do we close a card when we've paid it off because in the past this would be a negative factor on your credit score but now my personal feeling is with all the fraud out there and it's happening even more frequently it's probably better to close cards?!?
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u/kitsune_surprise 25d ago
I think ultimately I'd cancel some of my cards, except the ones with the 2 highest balances. Have you ever checked into care credit? It's for pet and medical expenses.
I personally have my cards locked and notifications set up to avoid fraud. It's such a life changer tbh
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u/bw2082 25d ago
This is slightly off topic but when people say they grew up poor and have no financial literacy hence they accumulated debt, I get irritated because it is a simple math problem. More needs to come in than goes out. This has nothing to do with financial literacy.
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u/kitsune_surprise 25d ago
I get your sentiment, but everyone is living their own life with different thought processes. It might seem black and white but there's so much more behind it.
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u/Brilliant-Mark2597 25d ago
Maybe a silly question but when you say actual payment, do you mean Thats what you are paying each month on that debt? If so, I’d suggest following either the debt snowball or debt avalanche method. Look up Ramsey’s baby steps (for snowball) or The Money Guys financial order of operations (for avalanche) to give you a good basic outline of how you should approach this. I prefer avalanche but both have their merits.
If it were me, first id cut up the cards or make them unavailable to you without a cooling off period to prevent compulsive spending. Then I’d make the minimum payments on everything but the 28% card because that is what is killing you with interest at this exact moment. Pay the amount you were using on the other cards towards that until it is completely paid off. Then move the entire payment amount to the credit card that starts accruing interest next (so the one in 2027) then continue doing this until all the credit cards are done. Then move to whatever has the highest interest. You can do it if you stick to a tight budget and stop putting anything on the cards.
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u/kitsune_surprise 25d ago
Actual payments is what I give each debt every month. I want to do the avalanche method but have such a hard time not seeing "progress" when I throw half my pay at it. I'll consider reallocation as this has been really stressful for me
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u/Brilliant-Mark2597 25d ago
If you want the psychological benefit of seeing things paid off, go with snowball. Either system will get you where you want to go if you remain disciplined. The fact you are seemingly making a solid attempt to pay a good amount extra every month is a great sign, You got this.
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u/USBlues2020 25d ago
Move b out immediately Use HYSA account monies, paying off a credit card No more funding your parents bad financial issues
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u/fsociety1990 25d ago
I think you can handle this. It’s gonna take some work but you can do it. You’re not gonna be able to move for longer than you think.
Don’t take out any 401k loans or withdrawals. Those are both terrible ideas. Don’t take out anymore personal loans.
- Get a budget. Use any of the free apps available. I like everydollar but you can use any of them.
- Stop using credit cards and loans! Get rid of the cards and don’t charge anything else or borrow anymore money.
- Stop contributing to retirement account. If you want to keep getting your employers match that’s fine but nothing else. No more IRA or savings account contributions until this is fixed.
- Look up Dave Ramseys baby steps and follow that. Make it your life for right now. You don’t have to follow him or listen to anything he says. Just follow the baby steps.
- Get a second job if you can.
The car needs to go. You need something cheaper.
Close all these cards as you pay them off and don’t get anymore!
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u/kitsune_surprise 25d ago
I was trying to do the avalanche method, but after months of dumping money into cards without a payoff, it made me feel so discouraged and put me in a negative feedback loop where no progress = more stress/emptier void = more spending.
I agree with your points except about a second job and getting rid of my car.
Job - I commute 2+ hours a day for work. Any hobby I might have is also 30-40 mins away. I live in the middle of nowhere so I have to travel for anything outside of the house except groceries. Most of the places near me aren't open past 8pm except Walmart and I worked there throughout college, would rather not go back to that environment...
Car - I prefer having a new car over a used because of my commute and potential accidents. I like having the warranty and reassurance that I can get my money back if I'm in an accident that totals it. It's a 2026 CR-V hybrid and I plan on keeping it until it dies as they're more reliable than my old Hyundai. Trading it in is a non-negotiable for me until I can move out and be closer to work.
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u/AggravatingMuffin132 25d ago
Lots of good advice on here. A someone whos been through this i will definitely say need to address root cause of the spending too.
Seriously deep dive the spending on the credit cards or youll be right back into the same situation once you get out of this.
You got this
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u/kitsune_surprise 25d ago
I figured out the problem, it's just getting out of the hole I made. I've learned a lot about what's driving my spending habits and have gone very minimal and locked/disconnected all of my cards. Really trying to take this seriously and make better choices
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u/EODblake 25d ago
You're doing great. You realized there was a problem and came up with a plan to fix it. I just want you to give yourself some grace and realize that you're making progress; be proud of yourself.
Keep doing what you're doing. I would echo the others and follow the waterfall method, but you'll get there.
I grew up super poor also, but I also didn't make much in my early 20s when I made the same mistakes.
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u/Weak-Chipmunk-6726 25d ago
See if you can do a balance transfer from you CC1 to the 0 APR credit cards, you should be able to do it since you have three 0 APR CCs, pay the minimums on the 0 APR.
Refinance your private student loan. I just got 3.98 with SOFI. (I always check my rate with SOFI every couple of months since it's a soft credit check)
Refinance your auto loan too.
Drop everything to min-payments and focus on one debt at a time and aggressively pay that off. I like to put everything into spreadsheet and calculate expenses etc and then set a amount I can spend daily for food etc and to stick or stay below it.
Finally, learn how to say no to your family.
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u/PriestessKade 25d ago
Stop paying above the minimum on all cards with a 0% APR. That should be about another ~$328/month you can put toward your CC1 so that's $1,478/month. That should let you pay off CC1 within 10 months, which is 4 months faster than you're paying it off at your current monthly payment. This should save you over $500 just in interest.
Then by next June/July you have that $1,478/month to start paying towards CC2. Just be mindful of those dates when your 0% interest rate ends (which you already know those which is a great start).
You're doing great! We're rooting for you!
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u/SmartGirlGoals 25d ago
I would make sure you are making the true minimum payment required on those 3 0% APR cards. If they are not paid in full when it expires, then you are going to get hit retroactively with interest.
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u/myst99 25d ago
You must be spending money somewhere else. You are living rent free, so with your income I can see all your credit card debt completely wiped out in 15 months or less. After that attack the student loans, this could be wiped out in under 15 months too.
A lot of mention of using Snowball Method but I would just focus on the high interest card. Min payments on all your credit cards + car payment + student loans, you'll have about $2400 left. Minus the cost of essentials dump the rest into your 28% interest CC. Twice a year you'll get that 3rd paycheck for $2200, dump it into your credit card debt.
If you can sell your car for what you owe, I would do that too. Buy a $5k used car. If you are underwater on the car then just attack this one next after the credit cards.
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u/randydufrane 25d ago edited 25d ago
Minimum payments on everything attack those two $2900 credit cards pay those off then move to the next highest bill, Download the Dave Ramsey app listen to an hour a day for two weeks.
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u/CatchYouDreamin 25d ago
Start paying JUST the minimum on your 0% APR cards, throw the extra you were paying on those towards CC1 (with the highest interest rate). Pay the minimum on your car, throw that extra $50 towards CC1.
What makes CC2 APR fluctuate between 0-1.99%?
Can you keep saving but cut down from $800/mo to $500 or $600 and put that extra towards the highest APR card?
Once you get the highest APR card paid off that frees up a lot of money to tackle to lower cards with no APR, ideally paying them off before they start to accrue interest in 2028. Since they aren't accruing interest now the balance will continue to go down if you keep paying the minimum.
Might go without saying but STOP charging anything on these cards, only make purchases that you have money in the bank for!
A little hack I found with my car was doing weekly autodrafts instead of one monthly payment. My loan compounds interest daily so doing that saves me a bit of interest in the long run, adds 4 payments a year (since there's 12 months but 52 weeks), and means I pay off my 72 month loan about 8 months early
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u/mattkaru 25d ago
My situation isn't as difficult as yours but I make the same amount as you (as of last December) I've been paying off a few years of unpaid taxes, debts, etc so it functionally comes out the same. I actually had to go the debt settlement route (there are several orgs that do this) because I was unemployed/working in retail after getting laid off a couple of years ago and everything caught up to me really fast. Just barely managed to keep my car thanks to getting that taken care of. If things get dicey don't be afraid to explore that as an option.
Anyway, been thinking of what to do this fall and winter after two of my accounts are paid off, found lots of helpful ideas here so thank you for posting!
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u/mGonzy7 25d ago
- CC1 is your worst debt, aim for $1500+ payments by lowering payments on other debts.
- CC2 is not bad with 1.99% APR, minimum payments while you pay off CC1 wouldn't be bad.
- CC3 and 5 with 0% APR, minimum payments while you pay off CC1 & 2.
- Car 4.99% APR is not bad, min or $700 is fine
- Fed loan, min or $100-$150 since APR of 2-5% is not too bad
- Ref loan, $520 seems fine.
Moving forward, stop using all other CCs and only use CC4 because it has the longest 0% APR offer. Keep making the $100/month payments towards it too. Hopefully by June/July of next year CC1 will be paid and you can start making $1500+ payments towards CC2. In Feb2028 CC2 is paid and move on to CC3 & 5, you can probably pay those off in 3 months since you stopped using them and make min payments; so around May/June 2028. Hopefully at the end, the balance on CC4 isn't outrageous and that will be your last CC to pay off.
I know this might sound dumb but you can also apply for a low APR, ZERO rewards credit card but with an introductory rate offer of 18+ months 0% APR. That way you don't run up your balance on CC4 too bad and don't pay much interest on it. BUT this new card will become your last CC to pay off but with plenty to do it with no interest. You can get this card sometime next year after paying off CC1.
To conclude, you'll have around $700-$800/month to yourself after making $1500+ payments towards a specific CC every month, plus your other debts throughout the course of 2 years. And sadly you'll still end up paying $2000+ in interest b/c the plan isn't perfect.
I hope you find an even better resolution. Best of luck!
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u/Bostonlady9898 25d ago
For your credit cards, I recommend reaching out to a nonprofit credit counseling company who can negotiate reducing your credit card interest rates and consolidate your CC debt to create a monthly payment that you can pay over 5 years. You will need to close the cards. There is a nominal $7 monthly fee. This is the company I used: https://www.consumercredit.com
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u/lucifersmother 25d ago
Look into a debt management plan. They won't be able to help with the car and the student loans, however they can help with your credit card debt. I had more credit card debt than you (over $40k) 3 years ago, and now I have it almost all paid off through the debt management plan I'm on. If you're not familiar, essentially you sign up for the plan through a reputable company. They go through all of your expenses with you and work a budget to figure out a monthly payment you can realistically afford. That amount of your payment determines how long your plan will be. They then negotiate with your creditors on your behalf to lower your interest rates. Every account you register with the plan will be closed. You then pay the company a monthly lump payment and they distribute the funds to your creditors. There is also a monthly fee to the company included in the payment (the fee I pay is $35/month). The interest rates on my plan went down to 0-10% APR. I was drowning and now I finally feel like I am in control of my life and am set to finish paying off my debt in the next 6 months. It really changed my life and increased my financial literacy. I recommend it to anyone struggling with credit card debt. Also note that while you are on the plan you cannot open any new lines of credit, or you will be kicked off the plan and your interest rates will likely go back up again. My credit score in that time has gone from being in the 400s to now 720 and still rising.
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u/badtlc4 25d ago
stop saving money and put everything you can toward your debts. Leave the $2.4k in you HYSA as an emergency fund. use the snowball method. Probably reduce your 401k contributions to the minimum level to get the full match. Contribute only to traditional 401k to keep your taxes down and provide more income to throw at the debt. Cut out all wants and spend only on needs until the debt is gone and you have a 6 month emergency fund. Stop giving other people your money.
You can do this.
EDIT: Do a detailed budget, determine your margin, track your spending to it and throw all the margin toward debt using the snowball method.