Case Study: Pay off debt, Relocate to Washington to live and attend school.

[Mr.Wulfric]

Life Situation: Single 27 y/o, 15,000 debt, mostly Student loans. No living expenses for 5 months. Temporarily live in Delray Beach Florida with Parents as of September 14th. High School Education. Goal is to pay off debt and move to Washington to attend school and reside there after.

Wages: No Income (Looking for work)

Pre-tax deductions: None

Other Ordinary Income: None

Qualified Dividends & Long Term Capital Gains: None

Rental Income, Actual Expenses, and Depreciation: None

Taxes: Just Income tax, I believe.

Current expenses:
Credit Card 1: 25% APR with $250.66 Balance (Pay off first)
Credit Card 2: 0% APR for 5 more months $1,681.63 Balance (Used to cover all expenses and then total is zeroed out at the end of every month from checking)

Debt 1: $148/ $50 monthly payments. (Pay off 2nd)

Student Loan 1: $2,001.08 / $61.33 Monthly. Rate of 6.55% (Pay off 4th)
Student Loan 2: $3,400 / $50 monthly payments. (In collections, stopping me from getting Grants/Loans for school) (Pay off 3rd)
Student Loan 3: $6,800 / $200 Monthly. (Pay off last)
Unsure of the Interest Rate of Loan 2 and 3.

Total Debt: $14,282.09

Cell: 110$ Monthly/ Verizon. 2 year contract started this month. Looking into returning it.
Car Insurance: Progressive $134 Monthly

Audible Account: $15/mo
Amazon Prime: $10/mo
Accounts are for Books, Audio Books.
Gym: $25/mo
Dance Class: $62/mo $13 per class 1 day a week.
Gas: $50/mo
Toastmasters: $139/year
Food: Generally covered by family. Contribute 50-100$ a week.
Total Expenses: $467-507/Mo Roughly

Debt + Expenses: $828.33 + $75 (Rough credit card estimate)
Total: $903.33/mo

Assets: None

Specific Questions:
Ok, so what I would like to know is;
What is the fastest way to eliminate my debt?
Create a solid foundation by developing what skills that will allow me to relocate in 5 months? (I.e) Learn website development? Get a Real estate licence?
I don't know the time frames for the return on these skills.
What flexible skills are worthwhile and what should I avoid?
i.e. If I find something to blog about how long till I see a return on my time investment.
Can I go to school and use these skills to make money at the same time?
I believe paying off my debt is my number 1# Priority as it will give me more money to work with. (Afford a place to live)
I have been gifted 5 months with no living costs and I dont want to fuck it up!

I apologize if I missed anything I tried to be as thorough as possible.
Thank you so much for any advice and help!
 
Thank you for the replies everyone. Just confirmed my plan, so I feel good that I was on the right track as far as reducing cost of living and debt.
I'm really interested in the type of skills worth acquiring though. My plan is to learn web development because of its overall usefulness in today's society.
Does anyone have experience in web development or blogging ect and can give me a time frame and resources they may of used to become competent at
blogging/web development or related skills?   

 

[therethere]

First off, I would try to return your phone and null your Verizon contract somehow. Maybe there's a 30 day warranty and you're not happy with service? Try anything! You can get a cell phone for <$35 a month and get the same coverage. Just a less fancy pants phone.

Secondly, you need a job. Any job will do. Do you have a degree or did you leave school without getting one and that's why you'd like to return?

[Kaikou]

Personally I would get any job, maybe 3-4. And save as much as possible.

40 hours @ $10 hr = 400 (+ 200 from part-time work)=

$12000 after 5 months....

You could do more and better.

[MDM]

What is the best way to eliminate my debt?

Not sure what you mean by "best" so this answer assumes "best = fastest".

1.  Eliminate all unnecessary spending:
Cell: 110$ Monthly/ Verizon. 2 year contract started this month. Cancel it.  Assuming the termination fee is less than, say, $500, you will be ahead of the game in 5 months.  It is possible to survive without a cell phone.
Audible Account: $15/mo  Amazon Prime: $10/mo  Cancel them.  It is possible to survive without them.
Gym: $25/mo  Dance Class: $62/mo $13 per class 1 day a week.  Cancel them.  Go running, do calisthenics in your room, etc.
Toastmasters: $139/year  Cancel it.
Car Insurance: Progressive $134 Monthly  Have you comparison-shopped?  Raised the deductible?  Eliminated comp/coll?
Gas: $50/mo That's ~17 gal/mo.  At 30 mpg, that's ~17 miles/day, every day.  Need to drive that much?

2.  Get a job (yes, you're working on it)

3.  Pay off your highest interest rate debt first.  See http://www.vertex42.com/Calculators/debt-reduction-calculator.html for interest costs with various repayment rates and strategies.

Easy to say, harder to do - good luck.

[DaveR]

For debt payoff, nuke CC #1 @25% and a small balance. Quick win. And you need to address student loan #2, with unknown interest and in collections. That will affect you in many ways--damage to credit score has implications on car insurance rates, on deposits for utilities, renting an apartment, etc. The sooner you can get that squared away, the longer it will have to "age" on your credit report.