Author Topic: Please help! (Judgement-free zone)  (Read 3268 times)

QueerBlackMustachian

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Please help! (Judgement-free zone)
« on: November 05, 2019, 05:43:23 PM »
Hello Ė

I need help!

I quit my job in June. Iíve had to live off of savings. I was making $103,000 a year, but the $$$ was not worth my sanity Ė very stressful mentally, emotionally, and physically. I would have died if I stayed in the position.

I need help as my finances are becoming dreadful. Iíve been looking for work and interviewing, but nothing is coming through.

I have a few questions based on my current financial situation:

Rent: $1,050 (my lease ends in June 2020Ė if I break it now itíll be 1,050 + 1,050 security deposit)
Utilities: $75/month
Credit card 1: $50/month (Owe: $459.81)  [Available $33]
Secured credit card 2: $50/month (Owe: $742.91) [Available: $257]
Credit card 3: $50/month (Owe: $560) [Available: $2,600]
Secured personal loan: $100/month [Owe $3,700]
Student loan payments: $411/month
Spotify: $9.99
Scribd: $9.99
Cell: $91/month [I owe $500 on the cell phone.]
Life insurance policy: $19/month
Entertainment: $75/month [eating out, movies, the occasional hang out]
Groceries: $130/month
401k: $12,000
457:  $8,000 (post-tax)
Pension: $11,000 (if I take out, Iíll have about $7,000 post-tax)
Health insurance: Medicaid
Available cash savings: $29,000

My fear is that I won't be able to find work!

Is there anything I should cut out?
Should I break my lease? [If I do, I can go back to my motherís house, which is not a situation I want. I have also tried subletting, but nothingÖ]
Should I pay off all my credit card debts? The minimums on them are $20/month, but I always pay a little more than double.
Should I stop paying my student loans and continue to accrue interest? [I donít pay principal balance, only interest.)
Should I refinance my student loans ($120,000) for a better interest rate?
Should I re-invest my pension and 457 into an IRA?
Should I tear up credit card #3? I have $2,600 available Ė no interest in it for another six months; then interest is at 14% APR.

Any advice would be much appreciated.

terran

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Re: Please help! (Judgement-free zone)
« Reply #1 on: November 05, 2019, 08:01:53 PM »
Definitely cut spotify and scribd. Plenty of free options between ad supported and the library.

Cell phone is high, but you'd have to see what it would cost to get out of if you're under contract. I'm quite happy with the $60/year (yes, per year) service from Red Pocket.

Are you financially responsible for anyone? If not, drop the life insurance.

Are there any options for income based payment reduction with your student loans?

Your lease will cost you $2100 to break, or $7,350 to keep through the end of June. What alternative options do you have and what would they cost?

Pay off the credit cards. Best case you paid them off, you get a job and you can stay out of credit card debt from here on out. Worst case, you don't find a job, you run out of money and you use the credit cards at that point. At least you won't have paid interest in the mean time.

I wouldn't be comfortable spending $75/month on discretionary entertainment without a job, but that might just be me.

Leave the 457(b) alone as you can withdraw from it penalty free (you'll still owe tax) if you run out of other money.

Those are my "defense" tips, I'll leave the "offense" (finding a job) ideas to others, but that's obviously the big issue here. I'm not saying something is wrong with you, but if you haven't found a job by now then something is going wrong somewhere in the job search process. You might consider sharing more about that and see what ideas people have.

middo

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Re: Please help! (Judgement-free zone)
« Reply #2 on: November 05, 2019, 08:17:01 PM »
I think @terran  covered it pretty well.

Cut spotify and scribd now.
Can you get out of the cell phone bill anyway?
Pay off the credit cards IN FULL and stop paying interest.  Use them IF you run out of money.
Move home and pay the up front extra.  Sucks to live at home, but if I could do it at 48 for 6 months for $ reasons, you can.
Stop going out.  Stop the life insurance.
Can you pay off the secured personal loan?

If these are done, your expenses drop to:
Loan: 100
Student loan: 411
Cell: 91
Groceries: 130
Total:   $732 per month.

I assume you would negotiate rent and expenses with your Mum.  You would have to add that to your costs.  But that is an annual spend of $8784, which means you should be able to survive for a lot longer than 12 months.


 

Kris

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Re: Please help! (Judgement-free zone)
« Reply #3 on: November 05, 2019, 08:42:04 PM »
Op, I think the posters above have covered the expense side of things.

I completely support your leaving a position where the job was not worth your sanity.

So, my question is, are you able in theory to get a similar position going forward? In other words, was the job crazy-making because of the job itself, or because of that particular environment?

If you have a decent chance of eventually finding a similar position with a somewhat similar paycheck, then concentrate on working toward that, as well as trimming the expenses as others have said above.

ericrugiero

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Re: Please help! (Judgement-free zone)
« Reply #4 on: November 06, 2019, 07:07:44 AM »
In your shoes, I would pay off all your loans except the student loan.  There is no sense in paying credit card interest with $29,000 in the bank.  The cell phone is way high but you need to check what your options are to get out of the contract or pay off the phone. 

Get a job.  It may not be making six figures but you can find something temporary that will pay your bills until you find something you want to do long term.  The expenses you listed are pretty low so it shouldn't be hard to cover them.  Unless you get a job I'd be cancelling all optional spending and moving in with Mom. 

SwordGuy

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Re: Please help! (Judgement-free zone)
« Reply #5 on: November 06, 2019, 07:29:32 AM »
It's better to find a replacement job and THEN quit.  It's easier, too.   Make that a lesson learned for next time.   

Keep your job network up to snuff.  If you don't have a job network or a good enough one, then build one once you get hired again.   Do what it takes to get your name and talents out there in your field so your resume goes to the top of the list next time.

You didn't mention what field you are in, so no one will offer industry-specific advice.

Malcat

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Re: Please help! (Judgement-free zone)
« Reply #6 on: November 06, 2019, 07:33:57 AM »
First, are you okay?
Literally nothing matters more than you taking care of yourself. If your job was literally killing you, then you weren't okay and are probably still not okay.
What are you doing to heal yourself?

mozar

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Re: Please help! (Judgement-free zone)
« Reply #7 on: November 06, 2019, 10:04:35 AM »
Hey OP, I've been there. In 2009 I was let go from my job and I had 130k in student loans.
It took me about 9 months to find a job.
But over the years I realized that every job was extremely stressful and that had more to do with my lack of coping skills than the job itself. Fortunately I was able to pay off my loans and since then I have focused on my mental health through self help books, therapy, and medication. Unfortunately on medicaid you can't see a psychiatrist but you might be able to find low cost private therapists in your area. Right now I am unemployed and I'm focused on not making the same mistakes over and over again.

Rent: can you find someone to rent your bedroom while you sleep on the couch or a cot? What are the homeless shelters like in your area? Are there wait lists? You didn't mention a car but some cities have designated parking lots for people sleeping in their cars. I would look into those first because living with family isn't an option for me. Remember though that you have to live somewhere so the focus should be on how are you going to support yourself with regular expenses over the course of your life.
Credit cards: I would pay off the ones where you just owe a few hundred dollars. Then use the one with the lowest interest rate for daily expenses and pay it off monthly. I don't agree that you should pay off all the credit cards because it would be really stressful emotionally to see your cash savings dwindle.
Phone: buying a 500 phone was a poor financial choice. Can you sell it? My phone was 200 and my plan is 37 with virgin mobile.
Other loans: I wouldn't make any big moves like refinancing until you feel stable again.

Please keep us updated. We're rooting for you.

dandarc

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Re: Please help! (Judgement-free zone)
« Reply #8 on: November 06, 2019, 10:27:50 AM »
Others have given good advice. I'll just point out that your cash-savings alone will cover over a year of your reported out-flow, even after paying off the credit cards. So long as you keep that spending to what you've been doing or even reduce it a bit, you have a fair amount of time to find a new job before you'll really have to make big changes.

Laura33

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Re: Please help! (Judgement-free zone)
« Reply #9 on: November 06, 2019, 10:38:09 AM »
First, zero judgment on quitting an intolerable job.  That took a lot of guts, so good for you standing up for yourself.

Second, you don't need to panic.  You currently have almost a year's expenses in savings.  I know you don't want to use up all of that, but this is what it's there for.  So you have time to recover from the bad job and get your head and your life in order.  I repeat:  this is why you have a cash cushion.

Third:  I have to believe that the CC debt is adding stress to your life.  What are the interest rates?  The amounts you owe are very small, so I would strongly recommend that you take money from savings and pay them off all at once, right now.  You will still have plenty of cushion.  And also, please stop focusing on how much available credit you have left on each cards.  That suggests that you think it's normal to be in CC debt, and in fact that having any room left is some sort of an asset.  That is simply not true.  Yes, it's good to have available credit for if and when you actually run out of money -- but that's not you and that's not right now.  Better to get back to zero on those cards and get used to keeping them there (but do keep them open as an additional safety net).*

The apartment is a gamble.  If you find work soon, it's not a problem; OTOH, that rent payment is the single biggest hit to your monthly budget and will drain your savings faster than anything else.  So what would give you more comfort, make you feel more secure -- having your independence in your apartment, or being free from the four-figure rent payment but dealing with your mother?  There is no "right" answer here except in hindsight, so just make the best decision you can and move forward.

Really, I think the most important thing you can do right now is spend some time on your own mental health.  You do not need exclamation-point-financial-"help."  Your finances are not "dreadful."  That is panic speaking, and panic is not your friend.  A) it jacks up your stress level and prevents the healing you need to recover from the job, and B) employers can sense desperation like a wolf can sense fear.  You need to be conducting your job hunt from a position of strength and confidence, and that's something that's hard to fake. 

And you deserve to feel that.  Look at what you did:  you walked away from a soul-destroying job.  You saved up almost $30K in accessible cash that allows you to ride out a pretty good storm.  You kept your expenses pretty low, and even if you did get caught up with too much easy-money debt, that is something you can easily recover from.  Yes, you are not perfect, but who is? 

I think you might feel better if you had a plan.  So, for ex., you decide that you're going to pay off the CC debt this week, you're going to look into swapping the phone and getting out from under that debt next week, etc. -- put things on the calendar so that you can feel you are making progress.  Then give yourself a timeline, e.g., you know you have plenty of money for a year even at your current spending level, so you will give the current job search 6 months, and if that doesn't pan out, you will start to look for any other job that will bring in cash and look hard to see if you can find someone to take over your lease (or see if your landlord will waive the cancellation penalty).  That way you can rest easy and not fret so much about the lack of income, because you know you're going to take action before your cash runs out. 

Good luck.  I am sorry this happened to you, but you will make it through.

*Added bonus that using little to none of your available credit will significantly help your credit score, which will get you a better interest rate if you do refinance your student loans -- I don't know if you'd be able to do that without a job, but you'd probably want to wait until you can get the best interest rates anyway, which means getting your other debt taken care of.

SKL-HOU

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Re: Please help! (Judgement-free zone)
« Reply #10 on: November 06, 2019, 11:01:01 AM »
I would cancel scribd, spotify and life insurance, pay off the credit cards. This alone would reduce the number of bills you would have to pay. It may not be much reductionto the bottom line but it may be helpful to your mental health to have less bills to deal with. I would get a job somewhere, library, casino, restaurant, home depot, somewhere. If possible, get a roommate for a few months at least since you really donít want to move in with your mom.

jeroly

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Re: Please help! (Judgement-free zone)
« Reply #11 on: November 06, 2019, 02:43:05 PM »
I'm sorry about your employment situation, but...

You posted essentially the same budgeting / credit card questions a year ago.  You got the answers you need.  So why are you asking the same thing again?  You know what you need to do! 

(Cut out the credit card debt, cut down the phone bill cost with a provider like Mint or Republic Wireless or the like, and now that you have no income coming in consider moving back home or lowering your housing cost)

You can do this!

ontheway2

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Re: Please help! (Judgement-free zone)
« Reply #12 on: November 06, 2019, 02:52:23 PM »
After the post above this,  decided to look at your post history.  Assuming the job you quit was the government job, what is your plan now with the student loans? I agree with the others that you should pay of the CCs and cancel the two subscriptions. Things don't look bad at all after that, but the student loans could be a killer depending.

Ethel

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Re: Please help! (Judgement-free zone)
« Reply #13 on: November 06, 2019, 04:35:05 PM »
I hope you're doing better now. I was in the same situation 8 years ago and I feel for you.

For your job search, I can really recommend the advice of Ask A Manager (I'm not affiliated with the site, I hope linking to it is ok). There is lots of free content on her website and she also has a book on job searching (haven't read it so can't comment).

mozar

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Re: Please help! (Judgement-free zone)
« Reply #14 on: November 06, 2019, 05:53:58 PM »
I'm glad I started posting here years before you could easily check someone's post history ( or it just didn't occur to people) I think I posted the same questions three years in a row before I got it together enough to start listening.

Finances_With_Purpose

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Re: Please help! (Judgement-free zone)
« Reply #15 on: November 22, 2019, 11:34:15 PM »
One other idea: put the student loans on short-term/temporary forbearance.  You can call and ask them to do it.

It's not a good financial move in general, but it's a good move in a situation where you have short-term cash flow problems and don't know where/when your next check is coming from. 

They'll add the interest onto your balance, but it will give you time to maneuver. 

FatFI2025

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Re: Please help! (Judgement-free zone)
« Reply #16 on: November 24, 2019, 11:56:30 AM »
One other idea: put the student loans on short-term/temporary forbearance.  You can call and ask them to do it.

+1. First thing I would do is forbearance or income-based repayment and then move back in with mom. Realize that your financial situation isn't dire and that you will find a job eventually.

Are you eligible for COBRA health insurance from your last job? Maybe consider some counseling and give yourself a few months to breathe. I'd say in the mirror "OK, I'm going to spend on counseling to invest in myself. When I'm down to $5K in the bank, I'll start considering lower paying positions."

Worst case scenario you end up in a low paying job for a little while, saving a little cash. Once things are stable and you have more headspace, you can start working back towards your long term goals.

You got this.