Hello, I'm a 35 year old software developer. I have substantial debts that I need to address but I'm not sure where to start. I'm exploring options and open to any advice. My reason for accumulating so much debt is because I've been supporting a family member financially for a couple years, and my savings and personal investments have been now used up. I have also made some poor purchasing decisions buying things I cannot afford.
I will list out my monthly expenses and income, as well as debt breakdown:
Income:
- $4556 take home per month
- Sometimes additional income for travel expenses
- Paid bi-weekly so 2 months per year I get 3 paychecks. I typically put the extra paycheck in these months toward my debt.
Other Assets:
- 401k: Current Value of $159,000
Expenses:
- Rent: $925
- Internet: $55
- Gas: $65
- Electric: $180
- Water: $45
- Trash: $14
- Food and Gas: $450
- Family Member Support: $1200
Total Expenses: $2934
Debt:
- Car 1: $409/mo, $24721 balance at 4.25% (car is upside down on loan)
- Car 2: $352/mo, $19000 balance at 4% (car is upside down on loan)
- Credit Card 1: $374/mo, $15857 balance at 13.99%
- Credit Card 2: $61/mo, $2828 balance at 18.74%
- Credit Card 3: $441/mo, $17353 balance at 15.74%
- Credit Card 4: $101/mo, $3059 balance at 26.49%
- Credit Card 5: $253/mo, $9346 balance at 19.74%
Total Monthly Debt Payments (Minimum only): $1991
Total Expenses + Debt Payments: $4925 - This is quite a bit more than I bring in each month obviously
Solutions I have considered
- Take a 401k Loan - I can borrow up to $39,000 at 5% interest. A 5 year loan at $39k would come out to about $735/mo, and I would pay off Credit Cards 1, 2, 3, and 4 with this, which would save me a couple hundred dollars per month.
- Debt negotiation program - I don't really know much about this but I know it ruins your credit score. A friend of mine did this and he was able to get a significant portion of his debt removed, and his credit score started coming back up after a few years.
Other than those options I'm not sure what else I can do short of getting a second job, getting rid of a car which I will still owe money on since I owe more than they're worth, or reducing the extent of which I support my family (this is a last resort). Looking for any and all advice.
Thanks!
Submitted April 27, 2017 at 10:19AM by odinsride http://ift.tt/2oPvJ8t
