#FinancialAdvice #DebtFree #PersonalFinanceHelp
Hey everyone! 👋 I need some guidance on how to tackle this mountain of debt that’s been weighing me down. I’ve laid out all the details of my finances below, so feel free to dive in and share your thoughts on how I can finally get rid of this debt once and for all. Here’s a snapshot of where I’m at:
– Total Debt: $43,000
– Credit Card: $13,755 at 20.99% annual interest
– Personal Line of Credit: $29,008 at 10.49% annual interest
– Net Monthly Income: $4,500
– Rent, Parking, Cloud storage, Insurance, Utilities, and other expenses
– Credit Score: 700
– Location: Calgary
Now, I’m looking for some actionable steps and strategies to start chipping away at this debt. Have you been in a similar situation? Any advice or success stories to share? Let’s help each other out and work towards financial freedom together! 💸🙌
One possible solution I’m considering is creating a detailed budget to track my expenses and identify areas where I can cut back. I might also look into consolidating my debt or negotiating lower interest rates with my creditors. Any other suggestions to supercharge my debt payoff plan? Let’s brainstorm and support each other on this journey to financial stability! 🚀🌟
So you have over 800 a month left after your expenses (some of which you could probably trim back as well). I’d pay the monimum payment per month on the LOC and aggressively pay off the CC asap.
The ass answer is get a better job
Super thorough post, but a few suggestions.
1. Consider looking at a debt consolidation loan to make efforts to reduce the 43k you currently have. You’ll at least have a plan for the next 60 months in paying this off. With this it is important you do not rack up any further debt on any other credit facilities you have access to. Although your score isn’t too bad, it will help reduce the high utilization.
2. Look at cutting your leisure expenses from now. Especially, if you’re unsure of your income situation in November. Cut back on Netflix, Spotify, and use YouTube or free streaming sites (It probably doesn’t seem much, but you’re essentially borrowing $28.85 at 10.49% best case scenario). Get rid of your “entertainment” expense (your dog and YouTube will be your entertainment for the time being).
3. Look at some options to supplement your income, without impacting your expenses too much. I’m unsure of your expertise, of capabilities but any extra income will help with paying down debt. And also alleviate the stress of uncertainty come November.
Hang in there buddy!
Can you cut netflix and spotify?
Can you change to a cheaper cell phone plan?
Those might be a start
1. Declare bakruptcy or do a consumer proposal or
2. Commit to debt repayment and being uncomfy for the next 2 years or so to get this paid off.
– get a roommate or move where you have them, get your rent to $1000 all included
– no eating out, no fun
– be honest about what that “other expenses” are and cut as much as possible
– any extra hours you have commit to dog walking or house sitting or door dashing
If you white knuckled this debt at 3k a month you might be almost clear in two years.
you also should call other internet providers and talk to them about leaving your current if they have a better deal, and also call your current internet and tell them you are planning to leave unless you get a better deal. i just switched from telus 110$ 1gb up and down to rogers 250 up and down for 40$ a month because i left telus
Get a second job and throw that money towards your debt.
Don’t declare bankruptcy or do credit proposal you will fuck your credit for years…just came to say this..ok bye.
Try logging into Koodo Self Serve > Mobile services > Change my plan to see if there are any offers on your account for cheaper plans that still meet your needs.
Try calling Telus at 1 (888) 811-2323 and ask for the loyalty/retention department to see if they can lower your bill. As a Koodo customer, you should also be getting a $10/month discount on your Telus Internet bill (see [https://www.telus.com/en/deals-and-bundles/internet-tv-phone/add-home-services](https://www.telus.com/en/deals-and-bundles/internet-tv-phone/add-home-services) ).
See if you can downgrade your bank account to have a lower monthly fee (although keep in mind service fees for anything you use, like overdraft, which may be included in your package but not in cheaper ones).
I just wanna say I am in a similar boat as you, I consolidated my debt: 2 cc and 1 loc 45k. The bank offered me a personal loan at 17% interest. I’m living frugal as possible and should pay my debt off in 2-3 years. It’s an open loan so I will be dumping more into it at the end of each year to pay off quicker.
Everyone here is giving very sound advice so I can’t add much other than my experience. Good luck!
Youre in a lot of debt with high interest. Cut down your entertainment to $100 a month, drink cheap ass wine, cut your groceries down to $400 month (totally doable for single person) and you have a surplus of around $1000 a month.
Make minimum payments on your LOC and dump the rest into your credit card, pay that balance off ASAP as its the highest interest. Once the credit card is paid off dump $1000 a month into the LOC.
Doing this it’ll take you little over a year to pay off the CC and 3 ish years to pay off your LOC assuming you keep the same monthly income. If I were you as shitty as it sounds get a second part time job, hell even if its 16 hours a week minimum wage youd probably net around an extra $700 a month. If you were able to put $1700 a month towards debt you could pay your CC off in 9 ish months and your LOC in a year and a half.
If the minimum monthly payment is high on the LOC go to your bank and consolidate your debt. They will likely help you out in such a way to make it more manageable.
Burn that credit card, get a consolidation loan. Learn math.
Netflix and spotify are a drop in the bucket compared to that card and the loc
Get cheaper internet, change banks to one without a monthly fee, cut entertainment to $100, cut vapes and wine, cut food to $300.
Put the extra $700/month towards your credit card debt.
Lots of great advice here. I would also cut vaping and alcohol entirely until you have it under control. You’re burning an astronomical amount of interest. Paying anything now will save you compound interest later. So pay that down immediately!
1. Consolidation is awesome
2. Even tiny savings put against your debt makes a huge difference over the long haul.
My advice:
Extreme measures now. You will never regret it. Make it a game where you try to “hyper mile” your finances, like how people for fun see how far they can make a tank of gas go by crazy minimalist techniques.
So canceling every service you can live without for awhile literally pays you in reduced compound debt interest. Eating frugally (but healthy), taking up free activities like cards with your neighbors, reducing utilities consumption, etc (all for the short term) can help. The trick is to stay focused, and learn to enjoy the extreme frugality for a while.
Don’t pay for a bank account. There are plenty of free ones out there – I use Wealthsimple now, also used Simplii
What are your minimum debt payments? That needs to be part of your budget.
Can you do your work without a car? If so, sell, get rid of parking, get rid of insurance. If not, others have given you good advice already.
If public transit is available, sell your car and reduce your debt. You would also save $440/month (less public transit cost).
First thing first is to consolidate that debt into a loan with a much lower interest rate.
I had a friend who went to Debtors Anonymous. They helped her deal with the financial aspects of strategic spending and repayment but also with her relationship to money. The emotions, justifications, shame etc. She became scrupulously honest , transparent, solvent and happy and proud of herself.
I always tell people who can’t afford to properly provide for themselves that they can’t afford a pet but that always pisses people off. So, good luck sir.
Do you absolutely need the vehicle?
Cut entertainment and gifts down to $200 a month maybe even a $100. Do a debt snowball payment method. Do a minimum payment on the LOC, hammer down that high interest CC. Once you paid off the CC, take those payments and use them to pay down the LOC.
Keep a look out for new credit card balance transfer options, where you can transfer your balance for 3% fee and have no interest for a year
Cut your CC in half. Today was your last day of using it.
How much is your car worth? You could consider selling it. That would give you some cash, and eliminate your parking, fuel, and insurance.
Can you get a roommate to reduce the rent? I recommend moving to the cheapest shared accommodation, in a low income neighborhood that is transitable or bikeable to work.
How about a second job to put all it’s income toward debt?
What other assets do you have that you can sell? You have listed your income statement but not your full balance sheet.
It looks like you are living beyond your means. What is your plan to avoid doing that?
Your credit score is not an asset neither is it great.
You need to earn 3x.
Not enough there to cut to pay things off quickly.
Is a roommate possible
I see you have cancelled Netflix and Spotify.
Next up:
Why pay for a bank account? Try Tangerine, EQ, WS, etc. lots of good options.
Cloud storage is cheap, but do you absolutely need it? A dollar is a dollar.
Vapes. Cut it to zero if you can.
Wine is another good chunk. Cut to zero.
See if reducing your grocery budget to $500 per month is feasible.
You spend $400 each and every month on entertainment and gifts?? Cut to zero if you can.
See if you can pick up a side hustle to increase income.
Divert all the savings above to paying off your debt (Google debt snowball or debt avalanche; avalanche is more mathematically sound but snowball may be more psychologically motivating). Consolidate debt if possible to lower interest rate.
The Ramsey advice of setting aside $1000 while you do this is sound.
After you pay your debt off, increase your emergency fund to 6 months worth.
Then after you can divert the savings to investments… And perhaps relax a little and treat yourself.
Why is your bank account costing you 17.95?
If you can’t get another consolidation loan at a lower interest rate- As you pay down your LOC- transfer the available credit limit to your credit card. For example, it looks like you currently have almost $1000 available- so put that $1000 on your credit card- eventually all the debt will be on the lower interest LOC.
Not sure if your field- but start looking for a regular salaried job. You cannot afford to be without income/EI
Consolidate loan, then:
* Stop drinking: $80 a month
* Stop smoking: $40 a month
* Cut groceries down to $100/week: $130 a month
* Switch to an internet reseller like Lightspeed or Teksavvy: $50 a month
* Cut down slightly on entertainment and gifts: $100 a month
That’s close to $5k a year if you stick to it, and then there’s the $11k or so you already have in leftover income after your listed expenses.
Assuming 12k repayments annually to give you about 4k buffer, you should be able to clear your debt out in about 5 years.
A part-time job would probably bring you down to 3 years.
You can do this.
A few other commenters have said this, but regarding the car, do you need it for work or your personal life? If not, that seems to be the most obvious win here. Given that you’re in Calgary, using public transit might be feasible, and for the times you do need a car, perhaps Uber can bridge that gap.
Of course, if your income relies on the car, it’s a non-option.
Is $150 normal for parking in Calgary? That seems high, and if you are only spending $80/mth on gas and maintenance you must not drive a ton. Any chance you can save money in that area?
I was/am in a similar position. Total debt is $41,000, similar salary, slightly lower housing costs. I talked to my bank last year, and they took the debt that I had over 2 credit cards and my LOC and consolidated it into a loan with 10% interest. With that, they canceled my LOC and one credit card, brought my last credit card limit down to $1,000. They automatically withdraw my minimum payment for my loan twice a month (directly after payday), about $360 each payment.
I did what you’re doing now, looked for every instance of saving money – lowered cell phone, changed internet provider (Oxio $50/month), no subscription services (I have a gracious sibling who lets me use their account and pays for my $7/month sub account on netflix). My monthly entertainment costs are $0, my gift expenses are $0, and I don’t have a budget for anything like alcohol. I literally just pay for groceries and stay home. My friends know that I’m focused on paying down debt, so if they want to go out, it’s gotta be free or on them.
Without any extra emergency costs, I can put an average of $1,000 towards my debt each month (over and above the automatic withdrawal payments). Barring any unforseen life stuff, I should be paid off in 4 years. Because life stuff always comes up, I tell myself it’ll be 5 years. Without any extra payments toward my debt, it’ll be 9 years, as per the details of the loan agreement.
Silly question here. Any chance your parents could loan you the money to pay it off, then you send them 800 a month?
First, you find any way possible to save $1000 for an emergency that won’t force you into using credit.
Then:
I would deposit every dollar into the line of credit and only take out what you need and then either make minimum payments on the CC until there is enough room on the LOC to consolidate it or consolidate the CC in steps.
My concern would be lack of an emergency fund with option 2. Meaning you would have to dip into credit in a jam. So I would personally pay the minimum on the card and leave as much in the LOC as possible until I have enough borrowing room to absorb the card balance.
After that, you reduce the limit on the card substantially ($2,500 maybe?).
Once you have nothing left on the CC, I would use the grace period on the CC to act as my default debit card until you pay it off with the LOC to avoid higher interest on the LOC and leverage the lower annual rate and daily compounding of the LOC to your advantage. Meaning you offset income against debt at a higher rate of interest than you would earn in a chequing or savings account.
I would then focus on building 6-months of emergency expenses since you are on contract work and put that money into an account at an online bank with no fees and a semi-decent interest rate so the inconvenience of accessing that money is a deterrent from you using it unless it’s an emergency,
How much of your phone are you using? Like, how much data, how many minutes. I have a Koodo prepaid that’s $15/month and gives me 100 minutes talk, unlimited incoming talk, unlimited text, but not much data.
Wine, vapes. Work on that. Really really work on that. And you’ll feel better, too.
Entertainment and gifts: $400? That’s a lot. Cut back.
Are you single? Because over $500 on food is pretty high. I spend about that for two, and my son comes over weekly to do laundry and be fed. :/
$17.95/mo for a bank account is pretty insane – I know it’s not a huge amount that will move the needle but I’d look for free alternatives.
You have lots of great advice here so I don’t have much to add but Gail Vaz Oxlade has so many great resources you can get for free on repaying debt. She has books as well as shows (Til Debt Do US Part and Princess) you can watch for free on Tubi or on YouTube. You can learn a lot from those and it can keep you motivated since you’ll be compromising your lifestyle for while.
Also I didn’t see mention of an emergency fund – don’t forget to work on saving something every month as well or you might just continue the cycle of debt since you won’t have cash to rely on when unexpected issues come up. Good luck!
> *(Note: Currently on a work contract that ends Nov. 1, 2024. There is a possibility of an extension, but I’m not yet certain. I’m cautiously optimistic that I won’t have an upcoming employment gap.)*
With this, you’re on the edge of a cliff. While you cut small things like Netflix at $12mo. You keep vapes/wine for $120 and entertainment/gifts at $400. You need to move these big levers as well.
I do think consumer proposal, bankruptcy is an option but I’d wait until your contract situation is known.
Internet is too high you should switch ! And no one should be paying bank fees! Move to Wealthsimple or tangerine or anything that’s free!
Wine and vapes can go to zero. $120 saved and health improved.
Bank account and cloud storage can go to zero.
Entertainment at $400? Lets hear those details. That should be $100 MAX in your situation.
I’d take a look at your Internet options too $90/month is pretty high. Resellers in BC like Light Speed are about half that price, I don’t know what options you have in Calgary though.
You should see if you can get a line of credit that is lower than your credit card interest.
Your interest is killing you right now.
You have to really tighten your spending sphincter.
You need a total change on your spending.
Quitting alcohol can be really beneficial to your savings, your Health AND The amount of new energy you will have can really exponentially enable you to reach higher goals.
I would seriously look at getting a loan to pay off your credit cards at a much lower interest rate and pay them all off ASAP.
You need to go through your credit cards and highlight your unessecary spending and cut the fat of your spending
Add it all up.
Coffee is a big cost at the end of the year.
Eating out these days will really send you broke.
.the best way to save money is literally to not spend it.
Start attacking your lowest debt extremely aggressively. Get it paid off and move on to the next one..AGGRESSIVELY. Repeat this process. Drop all excuses and get it done. Make sacrifices in all other areas. Eliminate all “Variable expenses” until your debts are paid. If your line of credit wasn’t almost maxed I would of suggested moving your credit card debt to your line of credit at the lower rate. You could still move some of it. That is the best I can offer. 700 is a good credit score good job.
Get groceries down to $300 to 400.
Quit the vapes
Quit the wine and I’d suggest you have a drinking problem. If the thought of not drinking sends you into a tizzy, you have a problem.
You also can’t afford pets now, but I know you’ll keep it.
My impression is you have a dependency on a wide range of coping mechanisms. Maybe look into therapy.
You need to get a new job or have some certainty on the contract extension asap. Do you have an extra bedroom or den you can rent out? You should also consider cutting back entertainment/gifts, vapes and wine from your budget. Another thing to consider is looking at getting rid of your car and using public transit to get around. Not sure how feasible that is but it’s worth a look to get rid of parkin, gas/maintenance, insurance, and a decent chunk of cash to put a dent into your cc
Gotta go back to college mode. Live like you are broke (because you are) and fire everything you have at the debt. Highest rate first obviously. Work all day then find a side hustle at night. Tell your friends you gotta get your shit under control so won’t be eating out etc. could also explore jobs up north. Lots of opportunities to make a lot of cash and they will also cover housing costs. You gotta be sure you don’t get sucked into the party and toys life though.
move whatever you can from the credit card over to the loc as you pay it down and more room becomes available put more of the credit. even incremental amounts will reduce the total interest paid throughout the month! consolidation is also a great option as it will reduce your payments but it will also likely require you to close the credit card and the loc