Financial/Career Advice for my Girlfriend

November 22, 2010 8:41 AM

My girlfriend graduated this past summer and has about $9,000 of college-related (not a student loan) debt. She's treading water and having a very hard time post-grad, and still hasn't found a job yet. Works full time at a coffee chain but it just isn't enough. Need some advice...

My girlfriend just turned 26 this month. She graduated at the end of summer with a Bachelor's in Psychology (major) and social work (minor). To make a long story short, she had delayed going to college earlier in her twenties, due to a family incident involving her mother where there was fear of suicide etc. Doing this put strain on the relationship with her father where she basically had to front the whole cost of college herself since he had believed

Her total debt right now is about 8-9k spread out across 2-3 credit cards, all pretty much directly college related. She currently works at a popular coffee chain as a shift manager. Currently her major bills are her car, credit, gas and food. She still lives at home so rent is not an issue.

I had her go through all her credit cards and call the companies trying to get the balances knocked down. She's trying to limit any other expenses as much as she can. She's cut her work hours down a little bit (from like 40 hours a week to about 30) so she can job search further. She isn't spending ANYTHING on any card and has basically shredded them. The big reason she's still at her current job are the excellent health benefits they offer. So two fold question:

1. What can she do to work on paying off her debt so that she can save and just pay bills every month instead of dumping the majority of the money to bills. I've considered bankruptcy for her but that's such a horrible last resort that ruins your credit for years. Is there a way to consolidate all the credit cards into one bill? (I guess that's like a debt-consolidation?)

2. What kinds of jobs can a psychology major/social work minor find post grad? She's planning on graduate school but she needs to find a better job than what she has now. The pay is better than minimum wage, but it's not enough to save or pay down debt. Do you think her credit card companies would lower her balances even more if the only other option would BE bankruptcy? (They'd want to get some money as opposed to NO money right?) Anyone have any stories etc of this?

She's just treading water right now so I'm really just trying to figure all options. Thanks very much in advance for everyone who takes the time to read and offer advice. I love this woman and I want to marry her, but she knows she needs to work through this first before we're anywhere ready to get to that step.

posted by PetiePal to work & money (49 answers total)

does she belong to a credit union? They may be able to give her a debt consolidation loan that is at a reasonable interest rate.
posted by dpx.mfx at 8:44 AM on November 22, 2010

She should ask the credit card companies to lower her interest rate. Most will. You just have to ask.
posted by phunniemee at 8:44 AM on November 22, 2010

Sorry, I posted too soon. Here's a script:

Hi, my name is [Girlfriend]. I am a good customer, but I have received several offers in the mail from other credit card companies with lower APRs. I want a lower rate on my card, or I will cancel my card and switch companies.
posted by phunniemee at 8:46 AM on November 22, 2010 [2 favorites]

I don't know much about Credit Unions but I'm assuming she does not belong to one. I had her call them all and ask to lower her a balances, but I don't know how assertive she was in it. I think one or two told her no. I had said to call back when you got someone else etc but it would prob. be more helpful if I was present when she made the calls.
posted by PetiePal at 8:50 AM on November 22, 2010

Not the balances--ask to have the interest rate lowered. They're more likely to do that than knock off some of the actual balance.

The other (not great) option that should be explored is selling the car and making do with public transportation, rides from you, a bike, or a cheaper car. It may not be a convenient option and may make the job search more difficult, but don't dismiss it out of hand. There are ways to get around other than a car. If she can't pay for these loans while working 30-40 hrs. per week when she's NOT paying rent, I'm thinking the car is costing way more than it should.
posted by BlooPen at 8:54 AM on November 22, 2010 [1 favorite]

Seconding calling the CC companies. Her card issuers would rather get less interest off her balances than get no interest at all.

A balance transfer to a new card with a 0% introductory APR could also be an option to help partially deal with the CC debt, but I'd proceed with lots and lots of caution. If she has high interest rates on her other cards, 8-12 months with a 0% APR could allow her to pay off the principal debt without interest eating away at her payments. Balance transfers are usually a rip-off because there's usually a one-time fee involved, which can be hefty as it's a percentage of the amount being transferred - and after the initial period is over, you'll oftentimes end up with an interest rate that is sky high. But if she crunches her numbers and finds that a) she could afford to pay off the whole debt during the introductory APR period and b) the transfer fee spread out over the course of the introductory period comes out to less than what she's paying monthly in interest right now, it could help her get her head above water. If she does this, she should close the card she's transferring the balance from immediately and continue to avoid additional expenses on the new card.
posted by superfluousm at 8:59 AM on November 22, 2010

Seconding dpx.mfx's suggestion of looking into getting a debt consolidation loan through a credit union. Depending on her current interest rates on the cards she has, her credit rating, and the cost of getting the loan it may be a good idea.

I don't know much about Credit Unions but I'm assuming she does not belong to one.

You can join one for free in most cases. A lot of them are local so the ones that she is eligible for can vary depending on where she lives. There are also national ones like PenFed which she would be eligible for if she has any relatives who are veterans or currently active in the military.
posted by burnmp3s at 8:59 AM on November 22, 2010 [1 favorite]

The car I think is $218 a month. Her job is 30 minutes away. It's the only source of income right now. She's a shift manager and makes a good chunk more than she did as a plain barista. She also lives kind of in a rural area so car selling is not really an option.

She actually had traded in her previous Toyota for a Hyundai which got better mileage, more options and a cut in payments of about $50 a month.
posted by PetiePal at 8:59 AM on November 22, 2010

Can you clarify why she had to cut down her hours to job search? Why couldn't she spend 10 hours a week searching after/before she gets off work? If she makes $10/hr, that's $400/month she's losing for fruitless job searching.
posted by emilyd22222 at 9:00 AM on November 22, 2010 [7 favorites]

And sometimes I can't see the forest for the trees - BlooPen makes a good point as well. Sounds like her car and the attendant gas/insurance might be a black hole for money. If that's the case, figure out how she can get rid of it, then you can tiddle around with interest rates and whatnot.
posted by superfluousm at 9:03 AM on November 22, 2010

Consolidation loans are a lousy idea as they just shift around your debt and bankruptcy for such a small amount of money is a really bad idea as well because for the rest of her future on credit and job applications they ask 'have you ever filed bankruptcy?' and she would have to answer yes. Also, sorry to say, to get a job in the psychology or social work field you usally need a Masters at minimum.
Here's what she should do:
--listen to Dave Ramsey (www.daveramsey.com). He gives great financial advice and people in even worse condition than your girlfriend often call in to share how they got out of debt.
--get rid of the car. Buy a cheap car with cash or go with public transportation.
--she should get a second job. Yep, I know it's hard to work two jobs but it really teaches you a lesson about never using credit cards again when you have to work so hard to pay them off.
--she should also stop spending money (no shopping, no going out with friends, no nothing) until her debt gets paid off. (Working full time and only being able to pay a car payment and minimums on $9k of credit card debt means she must have a lot of money unaccounted for).
Anyway, good luck to her!
posted by MsKim at 9:09 AM on November 22, 2010

@Emily She just couldn't get any job searching done with the schedule. Personally I think for the short term you'd just have to run yourself into the ground and do both, work the 40 hours and do your job searching at night.

Her biggest worry is that if she gets an interview etc she's kind of locked into her schedule and it's VERY hard to swap out in time for it since they're done the week before etc.

I need to look into her insurance and see what she's paying. I suspect she could probably get it cheaper even if it meant having a higher deductible.
posted by PetiePal at 9:11 AM on November 22, 2010

Resume the 40 hrs a week. Get rid of the cellphone and have employers call at home (ask her parents if she can tailor the answering machine message while she's still looking for a job). Car pool to save on gas. Get credit card companies to lower the interest rate. Only pay the minimum for now (this is good debt, not bad debt).

Ask for cash gifts this Christmas.
posted by furtive at 9:13 AM on November 22, 2010

I agree with emilyd22222 that now is not the time for her to be cutting her hours at work. She might consider postpoing her job search for now, and throwing herself into the job she already has- especially right now, there's not much hiring between now and January, but she could probably work a lot of hours over the holidays. $9k is not an outrageous amount of debt- if she manages her money correctly and stays focused on the task at hand, she can build her resume while paying down her debt, and be ready to jump back into job hunting once her debt is behind her.
posted by ThePinkSuperhero at 9:14 AM on November 22, 2010 [4 favorites]

What does she do with the extra 10 hours she gets from cutting back on her work hours? How much time does she spend looking got work without those ten hours? Because there are a lot of hours in the week left over after 40 if you are in a tight financial spot, and she should be filling them with job search and maybe even a second p/t job if she can find one. She should see about getting those 10 hours back and move all her job search activity to allow for this.
posted by biffa at 9:18 AM on November 22, 2010

-She is expecting a $3-400 bonus for Christmas which is nice.
-I agree more hours at work may be a smart thing. She's working holidays too for overtime.
-She has no cellphone bill, still on her Dad's family plan which is good

Winter is historically the slow job hunt season anyways. I'm having her get ready for college job fairs and all that. She's been reading What Color Is Your Parachute. And I'll look into David Ramsey. I'm pretty financially sound myself, I read a lot of those books (Ramit Sethi's I Will Teach You To Be Rich is a great one, and Suze Orman does well for women too)

I would help monetarily too but I know she doesn't want me to. We've discussed it before and it would just be a relationship stressor I guess...If things get really bad I can support her like I said she's treading water right now, but I want to figure out ways for her to start getting ahead.
posted by PetiePal at 9:18 AM on November 22, 2010

Can you clarify why she had to cut down her hours to job search? Why couldn't she spend 10 hours a week searching after/before she gets off work? If she makes $10/hr, that's $400/month she's losing for fruitless job searching.

That, she should be working full time and only miss hrs to attend interviews, every other part of any application process I've ever done could be done before/after I was at work on the job I was trying to leave.

This amount of debt is not particularly high and as she is living rent free there is no reason why it should not be repaid soon. But she needs what she needs to do to bring in the cash. And that probably means working full time while searching for a better job at the same time. It's what people everywhere do when they are trying to change jobs and have any kind of financial commitments, i.e. most adults.

She also needs to review what she spends her money on because if she works 30 hrs/wk and lives rent free she ought to have a reasonable amount of money to pay off debt every month. If she doesn't she needs to take a close look of what she spends her money on - you say she's not spending any more money on the cards she has but it clearly goes somewhere if it doesn't all go on the car/debt repayments.
posted by koahiatamadl at 9:19 AM on November 22, 2010

If she has negotiated down her interest rate and can afford her minimum payments, that might just be all she can do right now. When she has a real job, she will be able to make better payments and use the payment strategies advised in the millions of personal finance blogs out there (almost all of whom recommend the snowball method).

If she cannot afford her minimum payments, additional action such as debt consolidation should be considered. But if her crisis at this moment is simply that she's being pressured internally or externally to pay more than the minimums and more than she can afford, the attitude is the problem, not the debt. Yeah, of course, you want to pay that down as best you can as quickly as you can, but she works at smarmucks. That's just life right now.

9K in debt is not a personality flaw, it doesn't make her a bad nasty person who needs to be punished. A lot of people feel that way. She may feel that way about herself. You may feel that way about her. It's not good to feel that way, eventually the pressure will result in the opposite of reasonable debt reduction. It is really hard to find a job right now, and the pressure to find one asap so she can reduce her debt so she can marry you is going to be a distraction from putting her best effort toward applying and interviewing.

It's a manageable amount of debt as long as she doesn't put her head in the sand. Take care of the basic business now, start seriously hacking away at the debt when she has paycheck enough to do so.

And some people just don't live places where they can have a real job without a car. It's a necessity for a whole lot of people. Saving $300 now is sort of stupid if it halves your potential earning power six months from now.
posted by Lyn Never at 9:20 AM on November 22, 2010 [2 favorites]

She has no rent expense, her car expense is about 1/4 of her salary, she has no phone expense -- so in theory, she should have 3/4 of her salary for other expenses and debt repayment. This goes to food and to credit cards -- so how much is she paying for food? This number should be minimal.

If you want to help her without giving her money, treat her to food/entertainment things that you want to do but that she can't afford. *You* want to try out this restaurant, or have your favourite pad thai, or whatever; *you* really want to see this movie. But you want to do those things with her, of course. Allow her to repay you by making food for you (cheaper).

She should go back to full-time. If she gets an interview, most places have some flexibility about interview time.
posted by jeather at 9:28 AM on November 22, 2010

@Emily She just couldn't get any job searching done with the schedule. Personally I think for the short term you'd just have to run yourself into the ground and do both, work the 40 hours and do your job searching at night.

Her biggest worry is that if she gets an interview etc she's kind of locked into her schedule and it's VERY hard to swap out in time for it since they're done the week before etc.

These are excuses. I know it's hard to hear, but complaining about debt when the option of working more is available to you is silly. Is she really putting 10 hours a week into job searching, or is she justifying it by saying she needs a day open to schedule interviews? Most interviews I've scheduled are for a week or two in the future, because most employers know they have to work around this sort of thing.

Honestly, it sounds like you both know that her working more is the solution, and she has her own reasons for not doing so. Are you sure your guidance is welcome?
posted by almostmanda at 9:30 AM on November 22, 2010 [3 favorites]

Currently her major bills are her car, credit, gas and food. She still lives at home so rent is not an issue.

I think there has to be something we aren't seeing here. It is possible (though perhaps not easy) to live on this kind of salary while paying rent, so I don't see how there isn't a bunch of discretionary income going elsewhere. Is she eating out a lot? Buying lots of toys? Etc? She should sit down and exhaustively track her monthly finances in a spreadsheet, to get a better sense of where the money is going. I don't know exactly how much a shift manager makes, but with (what seem to me to be) conservative estimates, if she isn't paying rent, there should be no problem paying off 8-9k credit card debt within a year. When I was making that much as a grad student (in an expensive town), like half my income was going towards rent.
posted by advil at 9:30 AM on November 22, 2010

If you want to help her without giving her money, treat her to food/entertainment things that you want to do but that she can't afford.

This. Not only does it help her financially (in that she gets entertainment without having to pay for it), it also is a fun/nice thing for your partner to do for you that takes away some of the work/job-hunt stress.
posted by EndsOfInvention at 9:31 AM on November 22, 2010

If that's five shifts a week, 20 miles each way, getting 25mpg with gas costing $3.40/gallon, with her paying zero rent and buying her own inexpensive food most days ($1 for breakfast, $3 for lunch, and $5 for dinner) and eating off of you and her parents the rest of the time, with the phone and that's it, I'm looking at:

Rent - $0
Phone - $40
Gas - $120
Car payment - $218
Food - $205
Misc. - $100
Insurance - $150

I'm guessing she makes around $12/hour. When she was working full time what was she spending the other nine hundred (after taxes) per month on, exactly? If she puts every spare penny towards the debt, she should be clear in a year or so.

My belief, given the information you've provided, is that she's still in "budgets and living lean can solve my problems" territory. Get rid of the debt then start cutting hours to look for a "real" job.
posted by SMPA at 9:36 AM on November 22, 2010 [1 favorite]

Is she looking for something that specifically uses her psychology studies? Because that probably won't happen without a graduate degree. That said, with a BA in psychology, she can do pretty much any entry-level office job. Hopefully she is casting a really wide net and looking at all different fields--if she can act professional and keep lots of details organized, she'd be an asset to all sorts of companies, even if she only has a superficial knowledge of the particular industry. I bet she could use her shift manager experience to set herself apart from other recent grads competing for entry level jobs. (Obviously she should do a little homework before applying for jobs in industries she's totally unfamiliar with, but my point is that she doesn't need a degree in the given field to be an effective admin assistant or other entry-level position.) It might help if you followed up with a bit more detail about her job hunt. From what you've posted, it's hard to tell if she's applying to everything she can find and just having bad luck, or if she's counting herself out of certain jobs and thus not applying to everything she could.

Has she met with the career services office at her college to discuss her job hunt? They both help her with her resume and interviewing skills, and can connect her with alumni for networking purposes.
posted by Meg_Murry at 9:39 AM on November 22, 2010

That's what we do. I mean I basically pay for anything we go out and do, when we go out and eat etc. And I'm happy to do it.

The other part of it that I didn't add before...her parents are separated right now. Her mother basically served the father papers in August with no warning, and packed and left in like 2 days to another state. She's been battling that as well. Her relationship with her father has improved however which is a good thing. She still lives at their house with him.

The father and mother may patch things up, he's been going to see her every few weeks etc but it's a mental worry i know that much. And yeah it is Starbucks. The health benefits were the main boon. They helped get her through college and get her meds pretty affordable for asthma and some other pills. I don't think she even pays that much for food, I think her dad does, and if he doesn't she should.

The bigger reason for cutting hours was her father had expected her to do a lot around the house since she's basically there rent free, so between the 40 hour work week and doing all these chores etc it was just too much and she was nearing a breakdown. She needed some extra time out of all of it.

I do agree though that she needs to be earning as much as possible. Even a second job if she really wants to dig out. Perhaps she can lengthen the car payment term and make the payments less a month? Not the best option but it would allow her to shuffle some money to the debt. I really need her to sit down with me and show me exactly how much she owes and to what card etc so that we can see what the interest rates are. It may be a matter of it being just too many cards with high interest rates and not enough principle being paid down.
posted by PetiePal at 9:39 AM on November 22, 2010

While I'm sure it feels overwhelming, $9,000 in debt isn't awful. Probably the best plan of action would be for her to do a little planning. It shouldn't be too difficult to create a spreadsheet that applies the interest rate to her current balance on each credit card each month. She can use this model to see how quickly her debt reduces as she pays a set amount each month. If she can afford to pay, say, $100 or $200 a month toward the debt and interest, she should see a significant reduction over time. Sure, it won't eliminate her debt in a year, but it should provide mental relief that her debt isn't spiraling out of control while she looks for a better paying job.
posted by me3dia at 9:43 AM on November 22, 2010

@Meg

I pushed her to visit her college career center. They helped her with her resume/cover letter etc. Don't seem to be doing much in connecting her with alumni. THere was a career fair she missed beginning of the month bc she got really sick (like not able to get out of bed flu) which was horrible that she had to miss. The next one from them is in the spring...

I do agree she really needs to make a budget and adhere strictly to it. I don't know what else she's spending on, she doesn't seem to be buying anything. All her drinks from Starbucks are pretty much free etc. There are people who make less and seem to be doing ok even with debt, so it must be that her car payments and insurance are just too high. Insurance can be a super tricky thing if you don't know all the clauses and extra coverage they try to tack on. You may have a cheaper total number than another competitor but maybe 25% of what you pay is kinda BS incidentals you don't need.
posted by PetiePal at 9:45 AM on November 22, 2010

There's a theme throughout your comments of you seeming to feel that you're the one responsible for this situation- you push, you prod, you plan. It's not your life, but you seem to be the one in charge. You might want to reconsider that behavior; it doesn't set a good foundation for the future of your relationship.
posted by ThePinkSuperhero at 9:54 AM on November 22, 2010 [13 favorites]

I think you might be trying to manage her more than she wants you to manage her. She does work around the house in lieu of rent, so she is working fulltime, in essence, and working more than 40h/week is driving her crazy. Fine, she is choosing to stay in debt because she prefers not to work the extra hours. This is her choice. She should look at the numbers -- if she worked 40h/week instead of 30, how much sooner would she be paid off? Then it is just a question of priorities. Her priorities, not yours.
posted by jeather at 9:57 AM on November 22, 2010 [1 favorite]

@Pink I try to be more encouraging. I've been doing my best to stay separate from the situation and be supportive not controlling or directing. I really feel like my gf doesn't have a strong grasp on this she's going to end up spiraling down. It seems, to me at least, easily work-outable. Tough situation to be in for sure
posted by PetiePal at 10:01 AM on November 22, 2010

The more you add, the more it sounds like something else is going on here. Is she depressed? Is your relationship on solid ground? If she's 26 she should be able to work 40 hours a week and do some chores around the house and look for a job, too. What's going on for her that she can't? How much time are you spending together doing stuff? Maybe that needs to be cut back so she can spend more time on the other stuff. Or maybe treading water is good enough for now - sometimes people need to tread. If she isn't digging herself deeper, that's good. You can't make her do this if she doesn't want to, and it sort of sounds like she doesn't want to.
posted by dpx.mfx at 10:05 AM on November 22, 2010

Can she be more aggressive with the college career center? Like, call (not e-mail) the person who helped her with her resume and say, "I'd like to do some informational interviews with XYZ University alumni who do HR* in the healthcare and IT industries. Can you connect me with some?" And if that person can't, ask who can.

She should really focus on people who have any reason to give her the time of day--like people from her college career office, fellow alumni, or people she's met through networking, rather than random hiring managers who get her resume through monster.com. She can be a little pushy as long as she's polite. "I really appreciate your help with my resume, but just having a good resume isn't enough in this economy. I really need to network, and I was seriously ill earlier this month when the career fair was held. What can XYZ University Career Services do for me in terms of networking opportunities or alumni contacts?"

When I was looking for jobs right out of college, I didn't take nearly enough advantage of my career services office--primarily because I met with one person and that one person didn't seem to know what she was doing. I didn't bother to push to meet with someone else, or push to get other resources. I should have. Your girlfriend should do this now.

*I picked HR off the top of my head because a) it might be easier to spin her skills as HR-specific given her background in psychology, and b) HR professionals will probably be able to give her general advice on what's happening in hiring practices in the industry.
posted by Meg_Murry at 10:08 AM on November 22, 2010

@dpx

She does have depression/anxiety and is on meds for that. That's partly why health insurance is a big deal.

Our relationship is fine. She knows that engagement isn't happening until she's on steady ground, ideally paid off her debt. We don't spend an overly crazy amount of time together. She lives 30 minutes from me, we see each other usually once to twice a week on the weekends. I visit her job a bit and hang out maybe once during the week for a few hours but I'm not cutting into her job searching time really.
posted by PetiePal at 10:09 AM on November 22, 2010

OK, hearing that she has a history of anxiety and depression, I want to reiterate that developing a budget and seeing on paper how quickly her debt will go down may help relieve her anxiety about the issue.

It sounds as though her home life is pretty stressful right now, along with the stress of looking for a new job, and maybe this debt issue is serving as a proxy for her anxiety about everything else. Is she receiving counseling? Talking with a therapist about the upheaval in her life might help her be less stressed about her credit cards and life in general.
posted by me3dia at 10:22 AM on November 22, 2010

nthing the bit about debt consolidation being a scam. Don't do it. A disciplined approach to a strict budget may be the first step.

What about working at a temp agency? If she has decent typing and transcription skills she could become a secretary or an aide at her alma mater.
posted by patronuscharms at 10:23 AM on November 22, 2010

Actually--and I'm sorry for posting multiple times, but one last thing: her debt isn't due to irresponsible spending, correct? Her debt is due to the fact that she was paying for college on her own and didn't have enough money in cash or loans to cover all of her expenses, so a relatively modest amount of debt accrued. Unless there's something else going on (like her "college" debt is actually the consequence of out-of-control spending), I don't know why you're characterizing this as not "on steady ground." Maybe I'm misunderstanding, and you're just concerned about, I don't know, increasing that debt by taking on wedding costs, or you don't want to marry until you can afford a down payment on a house together. However, it sounds like you're saying that she's unfit to be your wife until she's paid off this frankly understandable, common, and modest amount of debt.

It might help if you took some of the pressure off of her by acknowledging that this debt isn't a terrible black mark on her life. She needs to find a way to support herself, pay off her debt, and prepare for grad school (or whatever her plan is), yes, but this isn't an urgent, screaming, red flag on her character. And the more you follow up with things like, "She knows that engagement isn't happening until she's on steady ground," the more it sounds like you (and she) consider this debt to be far worse and far more serious than it is. Maybe it's just how you write and not how you talk to her about it, but consider what you're telling her if you're saying marriage is on hold not because she's proven herself to be irresponsible with money, but because her life isn't perfect and she accrued debt paying for college. She's taken and continues to take responsible steps: living at home, switching to a cheaper car, apparently paying off $3-4K since August, trying so hard to find a better job. I'm not saying you should propose today, I just don't understand some of the very critical language you're using in your follow-up comments.
posted by Meg_Murry at 10:32 AM on November 22, 2010 [7 favorites]

Well, if I were her, I'd quit my job at the coffee place and take "awake overnight" shifts at a mental-health facility so that I would a) earn marginally more per hour, and b) have daytime time to focus on a job search. Even low-end mental-health work will look better on her resume than coffee work.
posted by Sidhedevil at 10:39 AM on November 22, 2010

Sorry to reply this way easier to reply to the questions almost in list form :)

-She is going to see a therapist next week, it was going to start in January but the place she wanted had no openings now till like Feb...and she needs to

-The bulk of the debt is from college related. She used to work as a massage therapist while in college and made decent money. When her father thought she stopped going bc she was "lazy" when in fact it was like a suicide watch for her mother he basically didn't pay for anything further. At the time had I known her I would have urged her to get more scholarships etc but she basically put herself through college. No student loan but the credit card debt is there.

-She isn't a CRAZY spender, but she wasn't thrifty at the time. She's locked herself down and isn't spending on non-necessary things. I told her to go nothing for me for Christmas, get her nephews maybe one thing apiece and explain to her family she just can't afford to give this Christmas. They will understand.

-I haven't decreed "I won't marry you" to her. I'm just saying my preference is for her to have the debt at least well handled before we're at that step. I'm saving up for a ring slowly, but this is something she really does need to be responsible and handle before I'm at that point with her. I'm nothing but supportive in all of it though. My main concern is that I'm not going to propose until I'm ready to make sure I can afford supporting rent/buying a house etc. It's not that I think she's a blight on the relationship don't take it that way.

-Her family life is pretty rough. Her mother after leaving has acted like she's bi-polar. Not to mention her father JUST had a seizure today and one of the children may have to fly there and drive him home from NC. The whole thing is basically a snowball of little or medium things that have just occurred too close to one another. Every time she's getting her head above ground it's like the hole gets deeper.

I'm trying to find the fine line of being supportive and informational and not directing or taking over her job search etc. I know she has a "meh" attitude of admin. assistant etc but it would be limiting herself not to be open to those.

Great suggestion on the mental health place.
posted by PetiePal at 10:51 AM on November 22, 2010

How much is she making at her current job? Because to be totally honest, a BA in this economy is not going to get her a high paying job and this comes from someone with a BA. I graduated in 2003, which wasn't a great time to graduate, but still better than now, and when I started out I couldn't get a job paying more than 24k full time and the second year I got a job paying 34k, which I was thrill about. Even adjusting for the fact that this is 2010 and not 2003, I would be surprised if she could get a job paying more than 40k and really that's probably very unrealistic, unless she gets very lucky. 30-35k might be realistic to start, which is probably only marginally better than what she is making now and probably comparable to what she would be bringing in if she was working full time and another part time job. If I were her I'd be trying to get Starbucks to let me work a few shifts a week as a barista, in addition to her manager job. If she worked just one extra shift a week @ $10 an hour, she'd have at least $3000 in a year to put towards her credit card and that's just working one extra shift a week.

So unless she is absolutely swamped with interviews, she needs to get back to 40 hours a week and probably take a second job. And if not a second job, she should certainly try and get a job for the holidays to make some extra cash.

$9,000 is NOT an insurmountable about of debt. A year, or maybe even less, with a second part time job should be able to do it, if she puts every penny towards the debt. It sounds like she needs to go to grad school to really get her career going, so she needs to work towards that goal far more than trying to find a job that probably doesn't exist for her right now. Of course she should keep applying, but she needs to work full time, get a second job, and accept the fact that she will be doing very little else other than working 6 -7 days a week, coming home, doing her chores, eating, and going to sleep.

I would keep the car. At this point trading it in for something cheaper would probably realize very little net gain, especially since she'd be rolling the dice in terms of reliability. I believe you when you say public transportation and carpooling aren't realistic. For many people its not and having easy transportation will be crucial is she tries to take on a second job, still squeeze in some interviews, and get her chores done. She can't afford an hour or more on the bus a day. She really needs more money coming and cutting out $100 maybe isn't going to make much of a difference.

Also, she should consider trying to move her hours so that she works the weekend. That way she'll have a day or two during the week where she could schedule interviews without having to change around her schedule.

She should also look into babysitting. It can be far more lucrative than you might think and a lot of parents are looking for a responsible 20 something as opposed to a teenager. It's an easy way to make a couple hundred bucks a month and often she'll be getting paid to watch tv, while the kids sleep.

And on preview after seeing Meg_murry's link to your old post, she seems to be making very reasonable progress on her own so I'm not seeing the problem. With her salary, paying off approximately $1,000 a month in credit card debt is fantastic. She'll be out of debt in 9 months. She seems to be on the right track already.
posted by whoaali at 11:01 AM on November 22, 2010 [3 favorites]

Agreed with what meg_murry said, you really haven't done much to suggest that she's instable or wildly irresponsible with money. Paying for her college degree herself and having paid down a substaintial portion of her debt while working in a coffeeshop less than a year after graduation is pretty good. It sounds like you're trying to be in charge here, you push her to see the career center, you agree she needs to stick to a budget, you had her go through her credit cards, you need to look into her insurance. That's way people talk about their children, not partners.

If I were her, I'd start looking into graduate school in addition to looking for a new job. What programs she is interested in, how to pay for it, what sort of employment opportunities are available to grad students, taking the GREs, etc. Having a goal in place might make her feel better about her work and home life situation.

Also--a temp agency is not a bad idea, but it's very likely she will make around the same amount per hour as she making now, with less-than-great benefits.
posted by inertia at 11:08 AM on November 22, 2010

Our relationship is fine. She knows that engagement isn't happening until she's on steady ground, ideally paid off her debt.
She's well on track to paying off all her student debt in 1 year. Maybe she needs to be on steady ground for other things, but she seems okay financially.

We don't spend an overly crazy amount of time together. She lives 30 minutes from me, we see each other usually once to twice a week on the weekends. I visit her job a bit and hang out maybe once during the week for a few hours but I'm not cutting into her job searching time really.
You spend very little time together, especially for a relationship that is ideally heading to marriage.

she basically put herself through college. No student loan but the credit card debt is there.
But the credit card debt is essentially a student loan.

She isn't a CRAZY spender, but she wasn't thrifty at the time.
You seem really into the idea that all debt is bad, and that it's inappropriate to be anything but insanely thrifty if one is in any kind of debt. This is fine, but it's not the only way to be, and not the only good way to be. Is she asking you to tell her what to spend money on as much as you are doing in this post? You come across very controlling.

I haven't decreed "I won't marry you" to her. I'm just saying my preference is for her to have the debt at least well handled before we're at that step.
How do you define well-handled? She is paying it off over the course of a year. I cannot see how this is not well-handled.
posted by jeather at 11:43 AM on November 22, 2010 [1 favorite]

apparently paying off $3-4K since August, trying so hard to find a better job.

Yeah, now that I see this I more or less rescind my comment. She is on track to pay off the debt actually faster than I had calculated (i.e. she is putting all of what would be rent, and possibly more than that, towards paying off the debt), and I don't think it is reasonable to expect it to go any faster. I also think, given this fact, the task of finding solutions for it to go faster isn't really one that anyone in her life really needs to take up, it sounds like she is perfectly on top of it even if she isn't happy with what she has to do...
posted by advil at 11:48 AM on November 22, 2010 [2 favorites]

You asked this question 3 months ago and she has knocked of $3k of debt since then. Why the need for another question now about this? It looks like she's already making major progress on her debt and she's also seeing what she can to move on. Are you looking for a magic bullet for her? Is that what she wants? Or is she whacking away her debt so you'll propose?

Honestly, it sounds like you're a big problem in your relationship, that you now suffer from male answer syndrome, and you are a big problem in her career/financial life.

You're asking the wrong question and so is she. She decided to reduce her income by quite a bit of money because she didn't have time to look for work. You made the mistake in not offering to do what you can to free up her time to let her have more opportunity to work. If you're even thinking about wedding bells (and if you're saving up for a ring slowly, the fact that she's knocked 3k of debt in 3 months means that she is a MUCH better saver than you are), you are now at the point if your relationship where you can do things like that to make her life easier. If you're not, you're part of the problem and considering her home life, you don't want to be part of the problem.

You need to stop answering her questions, trying to provide answers, and instead act in the ways appropriate for someone who is looking to build a life together with someone else. Free up her time by actually doing something for her. That's the best career/financial advice that you can give her right now in light of the fact that you answered this same exact question 3 months ago. There's no magic bullet here - just putting your nose to the grindstone and grinding it out. It looks like she's started doing that - now you need to too.
posted by Stynxno at 11:55 AM on November 22, 2010 [4 favorites]

@Stynx your message did not show up until now for some weird reason. The amount has not gone down 3-4k since the last time I asked. Last time was an estimate bc I didn't know how much debt she was in she had only vaguely referenced the amount.

Now I actually know the concrete numbers and what's she's been doing, because since then she has asked my advice and opinion on a number of things. She has told me she doesn't know how to dig out of this or what else she can do. The stress of her debt is making her sick and that is my main concern.

It is nothing like "my future wife is in debt and how that will affect my credit score etc." That has nothing to do with it, so please don't make assumptions based on non-fact. We used to see each other more than we do now, it was her choice to work the hours she wanted because she was tired of never having any weekends off ever. I am in no way restricting my gf in her work hours nor was it my recommendation she cut her hours down. I would have rather she kept the 40, or even increased a bit if she could and done her job searching at night, leaving the weekends for a little time off/fun.

The fact I'm answering again was to update the situation with a fresh question since the debt amount had since been clarified and her recent course of action has not gotten her any farther than she expected. She's frequently overdrafting her bank account and I didn't feel I got a ton of helpful info the last round.
posted by PetiePal at 12:03 PM on November 22, 2010

What's her credit score like? What are her credit card interest rates? At my credit union, you can't get debt consolidation loans at rates much lower than 11.9%, which is not much lower than a decent credit card and potentially not worth the transaction fees (I don't remember what those were, if any). If her credit score is good enough to get a 0% interest balance transfer credit card, that'd be ideal. Another option would be to see if she could retroactively get a federal student loan; I think there's a short window wherein you can do that, and the interest rate would be muuuuch cheaper. If she goes back to grad school, she could also live cheap and use the subsidized federal loan money to pay off the debt at that point. In the meantime, she might also ask some of the more reputable nonprofit loan consolidation organizations.

If none of those works, but before declaring bankruptcy, she could call the cards and say she can't afford the minimum payments. I think they'll ask for proof, so this might not work. But for people who do this, they close the card and ding their credit a bit, but also greatly reduce the interest rate (like down to around 3% if I remember right) while they pay them off. You might Google around on this option to see what the impact on her credit score would be.

I agree with others: this debt is not that outrageous, there's something funny in the subtext of this thread (why are we talking about her parents' marriage or your current unwillingness to propose?), and it's her life not yours. It doesn't sound like she's doing that bad. It sounds like she's in a super-tough situation and is nevertheless hanging in there.

The thing about personal finance is that it's personal and it's about what you want to do with your life. Money isn't everything, and it's important to invest in your own development at this age. Debt is just an ongoing obligation and the cost of interest. Interest is a waste of money, and the obligation limits someone's choices a bit (she couldn't go travel for a year), but it's not a mark of shame or bad character. So, as I think about why all of this subtext is present there, I want to say that if her home life is horrible, and her options are to pay this debt off over a year living at home or over two to three years while living with a roommate in a cheap apartment, moving out might well be worth carrying this debt a bit longer. It is probably very tough on her mental health to be living in the middle of her parents' divorce, with a father who cut her off financially without taking the time to hear what was really going on, and with a person who is demanding chores from her in a way that she finds so stressful that she needs to reduce her work hours. Mental health really helps boost someone's progress in life -- it's the key to finding a better-paying job, or having the energy to pursue grad school and a career path -- so it's well worth an investment. If living at home is really hurting her, the right money move over the long run could very well be to move out, and to use her benefits to seek therapy. If she moved to a city where she could sell her car and walk or bike to work, she would make up half or more of her rent right there.
posted by salvia at 12:50 PM on November 22, 2010 [1 favorite]

@Salvia

Not sure the rates I'd need to ask her. Good info though about the average lowest rate on Credit Unions. The time it takes to pay it down isn't the important thing. The most important thing is that she IS paying it down instead of the debt growing interest-wise and that she's at least making her other bills monthly because once your credit starts to go it's like a vicious cycle.
posted by PetiePal at 1:11 PM on November 22, 2010

How good is her credit? Would it be possible to transfer her balances to a card with a 0% APR? Look on bankrate.com. Sure, that doesn't solve the problem and there probably will be a balance transfer fee but it might work out that that will save her some money.

It sounds like you're being really supportive. Good for you. Just want to encourage you to keep it up because stress like this can snowball, especially around the holidays.

For what it's worth, this is doable. For real. I had more debt than this and I just paid off my credit card bill. I owe my school more money but still I feel a bit better.
posted by kat518 at 4:37 PM on November 22, 2010

fwiw, $9000 is something that she shouldn't file bankruptcy over, IMO. If she makes $12 an hour (full time, anyway) that should be plenty to start making a dent in these bills.

Anyway, I wanted to strongly advise against the snowball method for getting out of debt because it makes 0 sense numbers-wise. It's all a game played in one's head and if time is of the essence, snowball is not the way to go.

Also, I used CCCS to help me get out of debt. They negotiated interest rates with the CC companies so I didn't have to, and came up with a payment schedule that had me totally out within 5 years. Yes, using CCCS will probably ding your credit a little, but it's nothing like a bankruptcy or anything that dramatic. I was able to buy a car and a house while in the CCCS plan with great interest rates.
posted by getawaysticks at 5:07 PM on November 22, 2010

Honestly, it sounds like this is more your problem than her problem. Your initial question is about her, but all your follow ups have focused on you.

"I had her call them all and ask to lower her a balances, but I don't know how assertive she was in it. I think one or two told her no. I had said to call back when you got someone else"

"Personally I think for the short term you'd just have to run yourself into the ground and do both, work the 40 hours and do your job searching at night."

"I need to look into her insurance and see what she's paying."

"I agree more hours at work may be a smart thing. [...] I'm having her get ready for college job fairs and all that. [...] but I want to figure out ways for her to start getting ahead."

"I do agree though that she needs to be earning as much as possible. [...] I really need her to sit down with me and show me exactly how much she owes."

I could go on, but there's really no need. I hope you're starting to notice a pattern here. It's all about you and what you want, and nothing about what she wants. YOU want her to start getting ahead. YOU want her to be earning as much as possible. She needs to show YOU exactly how much she owes. It really just goes on and on. For your mental health and the health of your relationship, I think you might need to give serious though to stepping off on this issue. It sounds like she's doing what she can, and it's probably best if you just let that be the end of it right now. IF - and that's a big IF - she explicitly asks you for help then you should give your advice. If you can't let it go, that's something you need to work on before you kill your relationship.

I see that you've clarified that the fact that it's making her stressed is your main concern. That's good. But I think you should carefully examine whether you're adding to that stress. I know if you approached me with the attitude you've got here it would be a serious problem. Trying to solve her problems for her isn't going to help. The key is solving her problems with her, which involves a lot more support and a lot less making her go to career fairs and the like.
posted by stoneweaver at 7:15 PM on November 22, 2010