Advice Needed
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  1. #1
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    Default Advice Needed

    Hi guys..I need some advice. I have several things coming up that are going to require some money and I'm wondering what you all think is the best way to handle it. So here goes.

    I work two jobs. My main job pays me anywhere from $700 to $900 per month. This job is used to pay all my expenses. Since my parents pay for my car and health insurance still, and there's only me that I have to pay for, my expenses are about $600 per month (rounding up). That leaves me with anywhere from 100 to 300 dollars per month extra. On top of that I also have a paid internship, which pays me fluctuating amounts each month. One pay check was $50.00, one was $150.00...(so $200 for a month). I expect to have about $100.00 per month from that job, since it fluctuates and I prefer to assume I'll have less rather than more. My main job also offers monthly bonuses. This month (I'll get the check in January) it looks to be $150.00 before taxes (so let's assume right around $100.00)...

    To sum it up:
    * Job One = 100-300 dollars extra
    * Job Two = 100 dollars extra
    * Bonus from Job One= 100 dollars extra

    Now, I have several extra expenses...here they are:
    * Credit Card Debt - about $465 as of January (just sent in Dec. payment)
    * Textbooks - anywhere from $200 to $400 dollars. 400 if I buy from the bookstore on campus, cheaper depending on good online deals I can find but this would mean that they would most likely have to go on my credit card for now until I have the cash.
    * Tuition - $915.00 (due in January, towards the end of the month).
    * Graduation - I graduate in May and will have a myriad of expenses... very likely moving across country and all expenses which come with moving, flying to Germany (to visit my fiance, cause otherwise I may not see him..and let's face it girls, not seeing the love of my life is not an option), traveling back to my parent's home twice over the summer (once in June for my step-dad's 50th birthday and once in August for my best friend's wedding)...

    So..there you have it. My plan is to wait as long as possible and use all extra money I have in January up to that point to pay on my tuition and books. Hopefully I can get books really really cheap and paid for in January, and can still pay a decent junk on my tuition. I think that the rest of my tuition will be going on my credit card after that, unfortunately. Thankfully I have a student card with a very low interest rate (we're talking less than $15.00 a month interest on almost $700 bill). I absolutely hate having debt on my card, so my plan for now is to pay off that credit card bill as much as I can each month until it is gone. I would really really like it to be gone before June, and I think I can do that if I stick to my plan.

    However, here's my dilemma. I also have no emergency fund saved up (something that scares me) and if I spend all my money trying to pay off my credit card, what good does that do me if in May/June I have no money saved up to pay my upcoming moving expenses, flight expenses, etc that I'll have after graduation? There is a way to make extra money up here, and I'm working on finding time for that...(it's a medical testing place, it's perfectly safe, don't worry) but it's hard to fit into my schedule.

    So what do I do? Do I save and save and save and pay off my card later? Do I ask my parents for money and save and save and save and pay them off later (I already owe them over $2000 for college)? Do I go rob a bank?

    It doesn't help that today is my second day not at work, because of being sick...I've lost $100.00 of normal pay because of it. Thankfully I got $110.00 christmas money, but now that has to be used to pay my bills instead of doing a few things for myself that I've been waiting to do for months now.

    So, I know this is long..but any advice?

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    Oh, and I forgot to say..I'm also hoping to move somewhere after graduation where I don't need a car, so I can cut out all the added expenses.

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    What comprises your $600 in expenses a month?

    Can you get a better paying job? or second job?

    Can you defer your student loan payments?

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    Not an easy question..... I would be very concerned about having no emergency fund at all. I think I would try to have a least a small one, even two or three hundred dollars that could help with smallish bumps in the road. I don't know your family situation, but it sounds like you have supportive parents who would be there for a safety net in a real crisis.

    As for saving up for all the expenses or paying off the credit card, well, that's a judgement call. Paying interest on a card, even if it isn't much, really stinks. On the other hand, there are a lot of commitments not very far away. I think I might work on paying off the credit card or at least paying it down as much as possible. True, you would probably have to use it again for some of these future expenses, but you would at least have saved some interest in the meanwhile.

    These were just my first thoughts when I read you post. Others here will probably have a lot of other suggestions. At any rate, you've got some hurdles, but you also sound like you have plenty of determination to get past them and make it work. I'm sure you'll be able to.

    And I would also add, that if, in the end, you have to take on more debt, it's not desirable, but it's not the end of the world either. When you get out of school you will have more opportunities than you do now for increasing your income and getting you financial house in order -- quickly and at a young age. You will be far ahead of many of your peers when you do!
    Donna

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    I have to say that I am very impressed with where you are at financially. You are doing so much better than I was at that age! I would definitely save up an emergency fund. $500 should be fine, since you do not have a high income. Then concentrate on the debt. are your parents willing to help you cover any of the graduation expenses that come up? That could help out there. Good luck! you are doing great!
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    I suspect that you're going to have to increase your debt load to do everything on your list. I'm just thinking out loud, of course, but:

    $300 per month (I'm using the minimums you outlined) x 5 months (Jan-May) is $1500.

    CC debt - $465
    Books - $200
    Tuition - $915

    These total $1530 - and this doesn't include your trip to Germany (which, BTW, I totally agree with you 100% about needing to go on), other flights, or moving expenses. So I'm thinking at least some of this would go on a credit card.

    Since you're so young and still in school, I would personally work on the credit card and count on the Bank of Mom and Dad as a backup emergency fund until you can get on your feet. Hopefully you will be able to get a good paying job after graduation and clear the debt up, and then you can build up an EF of your own. I might want to set aside a very small (say $100) EF mostly for while you're traveling - if you need to have cash on hand for something while you're in Europe you can't just call home.

    You have a lot on your side, too - you should be able to get good rates for credit cards and pay minimal interest. While we all like to minimize or elimate interest, I believe that credit cards are primarily a tool - and sometimes we need to use them as financial tools to help us out. That's what they're there for. Think of the debt you're taking on as an investment in yourself - that's how I consider my student loans. If borrowing the money now leads you to a place where you will make more money and be happier, then it's probably worth paying a little credit card interest. You obviously have a good money sense and aren't charging up credit cards with unnecessary purchases. And you have plenty of time on your side.

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    Thanks guys! It helps a bunch!

    Unfortunately I know that to do everything that needs to be done, I will have to go more into debt (booo!), but I also know that all debt isn't horrible! I just really hate having any debt on my card.

    As far as getting another job, other than getting paid for doing a study at the medical testing place (which pays well, I just have to get it to work in my schedule sometime), it's out of the question. I just plain old don't have the time. Though hopefully I'll be getting a raise at my internship in the near future, which should help....and about getting a better paying job, I really can't. The job I have now offers up to $200/month bonuses (I'm at $150 now), for not working very hard at all. The job also lets me pretty much choose my schedule each month, which is great since I'm a college kid, and also allows me to leave early without pay nearly any time I want to, which is also great for those times when I have a test or something.

    So with your guys' added support, I'm going to continue on with my original plan. I'll work hard to pay off as much of that credit card debt/tuition/books for now, and then depending on what happens after graduation, I may pay less on the card for the last couple of months and save up the money to use to pay cash when needed for moving/after graduation things.

    One thing I keep reminding myself of, is that I underestimated everything and there is a good chance I'll have more than $300 a month if I really try to pay off things. I also remind myself that soon we have taxes, which means at least a little money back, which will help too. I'll be okay!

    Thanks for the advice everyone! If anyone else has any other thoughts, just let me know!!!

    P.S. I think I'm going to pass on the EF for now..I don't like not having one, but I think I'd rather get rid of the debt a little more and hope/pray that nothing huge and unexpected comes up. Thankfully I have a family who is willing to help me out if needed, and if something smaller does come up, money isn't so tight that I couldn't rearrange the use of my $300 per month extra to pay whatever it is that comes up.

    And at least I know I have good life skills, so that after college when I (hopefully) make more money I'll be able to get on top of things again.

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    Hey Guys:

    I wanted to update you, since my last post God has decided to bless me with the ability to do a study at that medical testing place. They're testing the drugs that get used on transplant patients, to ensure that they don't attack their new organ. I have to stay at the place for four nights total, over two weekends - and it pays $1,100. Yep, that's right. So...between that money, my extra money this month and some of it in February, I'll be able to pay my tuition, books and the rest of my credit card money off. That means by the end of February I'll be debt free. At least on my card!

    I'm excited. I've also decided that I need to try my hardest to be able to live and work in Germany for a year starting in August of 2007, in order to be with my fiance. He has a training program he wants to finish over there and I can't wait for him that long. Since he won't come to me, I'll come to him. I'm going to e-mail some job possibilities this weekend, so please pray that God's will will be done in it all. I want to go so badly, but there is so much that could stop me. The visa to work is hard to get as well... but I know that if it's God's Will, then all of it will work out. I'm so excited and so nervous!

    So, my new plan is to pay off my card by the end of February, and start saving every last penny I have extra after that. I'm also going to look into doing another study at the medical place before the end of the summer - it would help a lot.

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    I am glad things are looking up and yes God works in mysterious ways, he's always there for you. Please keep up updated on your situation and how everything went/goes at the end of February. Good luck!

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