How should I get out of this debt?

Question

I am currently at a job where I make $35,000 but have $13,000 in debt. I am 26 and living at home for now. Should I consolidate or get a 2nd job and try to pay off the debt that way? Thanks

Answer 1

depends on the rate of interest in which you have to pay your debt off along with the conditions of your loan.

if it's credit card debt, then you need to pay that off ASAP because if they jack it up to 20%+ then all you'll be able to pay off is the interest. you'll be stuck with that debt forever. anything with a variable interest rate you need to get rid of quick - either getting another job if you have nothing else to do, or maybe selling off some of the things that put you $13000 into debt.

if it's a fixed rate - like a college loan, then your payments are probably fixed as well. decreasing your debt immediately will be good only if you intend to make a major purchase soon - car, house, etc. but living at home will cut down on your biggest expenses - rent, utilities, maybe food, which means you should have plenty of the $35000 to use to pay off the debt probably within a year.

Answer 2

Relative to others your age - you are more than FINE - don't start to panic and jump into Debt consolidation - that will destroy your credit.
If you current w/ all your bills, but just not making a dent in the actual amounts owed......here's what to do:

1) List your bills (including student loans) smallest balance to largest.....pay minimums on all except the smallest and attack it w/ every single penny you can......look under the couch cushions!

Then w/ that small victory under your belt, you attack the next bill on your list......so on and so forth....

If you are living at home, that saves you at least $650 MONTHLY.

At $650/mo toward $13K - (assuming an 18% interest), you will be debt free in 24 months!!!! However, if you gross $35K and take home about 26,500 /12 mos that is $2,200 take home.....

If you smashed $1,000 against your bills you'd be debt free in 12 months!!!!!!

Hell, I'd change my payroll deductions to 5 for half of each year and get as much net pay as possible and get rid of this debt.

And, if you get a second job - the more you are stuck at work, the more you DON'T spend frivolously!!!

Good luck!!

Answer 3

I am not sure how you could consolidate, if you don't own a home, and have that much debt. You would be better off getting a 2nd job, and start by making minimum payments on all of your accounts, EXCEPT for the smallest one--pay them as much as possible, as often as possible, until paid off, and then move to the next lowest, and keep this up, and in just a year or two, you should be cleared of debt. Also, be sure to set up a gameplan, so that this doesn't happen again (ie: savings, stocks, etc)

Answer 4

get a 2nd job
luckly you are living at home so you dont have the usual bills homeowners or renters have
take advantage of it and pay off the debts so you can move out on your own someday

Answer 5

consoidate the $13,000 into one low rate loan, thats easier.

Answer 6

dont spend anymore money