Comments on: How to Get Out of Debt: A Step-by-Step Guide for 2024 https://dollarsprout.com/how-to-get-out-of-debt/ Maximize your earning potential Mon, 29 Apr 2024 15:38:47 +0000 hourly 1 https://wordpress.org/?v=6.6.2 By: Diane Taber https://dollarsprout.com/how-to-get-out-of-debt/#comment-32079 Thu, 23 Jan 2020 10:31:29 +0000 https://staging.dollarsprout.com/?p=5474#comment-32079 I’m really looking forward to paying off all our debts (including our home). I’m super excited to build wealth and finally find true freedom.

]]> By: Gina https://dollarsprout.com/how-to-get-out-of-debt/#comment-25729 Thu, 21 Nov 2019 00:22:26 +0000 https://staging.dollarsprout.com/?p=5474#comment-25729 I live on disability and like many others, I let credit cards take me over. I don’t have a lot of book sense but my sister-in-law does. About a year ago she helped me cancel all my credit cards. Now I have been paying the minimum on most of them as I only draw $771 a month and after the cards are paid and household expenses, there is very little left over for groceries. I love your ideas but I would love to see more about people in my situation. I live in an area that has been listed at the poverty level due to no jobs around. I have tried surveys but they only pay a quarter per survey. Gets kinda boring. I am an avid photographer, I have tried to find places that buy digital photos with very little luck.

]]> By: Brit https://dollarsprout.com/how-to-get-out-of-debt/#comment-22530 Wed, 23 Oct 2019 19:36:22 +0000 https://staging.dollarsprout.com/?p=5474#comment-22530 In reply to Kennedy.

Have you considered loan forgiveness programs? They are worth looking into for student loans as a majority can disappear.

]]> By: Ben Huber https://dollarsprout.com/how-to-get-out-of-debt/#comment-9357 Tue, 16 Jul 2019 16:29:26 +0000 https://staging.dollarsprout.com/?p=5474#comment-9357 In reply to Donna.

Hey Donna,

First off, it sounds like you’re doing a great job balancing everything. We might need a more details about your student loans to really point you in the right direction.

Namely,

When did you consolidate?
What is your remaining balance?
Do you currently follow a budget and how frequently are you pressed against it?

By consolidating, you likely saved a good bit of money in the long run, but may have increased your monthly payment to accommodate, which appears to be pressing you against your earning ceiling.

After consolidating, you can contact your lender about setting up an IDR (income driven repayment plan) — if cutting/trimming your monthly spending further isn’t an option, and a side hustle is out of the question — your lender might be willing to work with you to slightly lengthen out the terms of the repayment to give you a little bit of breathing room on the monthly payment (so you’re not missing any).

]]> By: Donna https://dollarsprout.com/how-to-get-out-of-debt/#comment-9334 Tue, 16 Jul 2019 04:18:56 +0000 https://staging.dollarsprout.com/?p=5474#comment-9334 Hey there! I have begun the action stage of getting out of debt. My credit score decreased by 58 points due to missed/late student loan payments. My only debt is my school loan, but I have rented housing for the past 10 years and now am ready to plow down my school loan debt. I am a single mom, one-wage earner. My take-home pay is $4,000 a month after my FSA and 401k withdrawals (with a 3% employer match). I have cut my expenses significantly with the exception of Catholic school for my high-schooler. My son starts driving this year and the insurance is an added expense. My loans are consolidated at 3% interest, but my total loan payment is $836 monthly. Do you have any pointers for me to get that school loan debt paid off so that I can start saving for a home?

]]> By: Kennedy https://dollarsprout.com/how-to-get-out-of-debt/#comment-8856 Sun, 02 Jun 2019 04:30:28 +0000 https://staging.dollarsprout.com/?p=5474#comment-8856 I left employment at the end of 2017 and had a mortgage of $90,000 with a monthly repayment of about $700. I was able to make these payments up to the end of 2018 when my income was reduced and could not service the loans.

I am now in arrears of 5 months with no sight of being able to pay. Our family house is collateral. Do I sell the house and pay off the debts?

]]> By: Ben Huber https://dollarsprout.com/how-to-get-out-of-debt/#comment-6796 Mon, 08 Apr 2019 01:58:01 +0000 https://staging.dollarsprout.com/?p=5474#comment-6796 In reply to Annie.

May I ask what sort of loans and what interest rates are you currently looking at?

Also, what is your current annual income?

That accrual rate is astronomically high/abnormal. We might be to make more specific suggestions but would need to know more details if you feel comfortable sharing them.

]]> By: Annie https://dollarsprout.com/how-to-get-out-of-debt/#comment-6716 Fri, 05 Apr 2019 21:16:54 +0000 https://staging.dollarsprout.com/?p=5474#comment-6716 What if your student loan debt is so massive that it’s near impossible to pay off? My loans are over $350,000, most of which is just interest I’ve accrued. Last year alone over $52,000 capitalized on my loans. How do you get out of something like that, which is so massively overwhelming?

]]> By: Ben Huber https://dollarsprout.com/how-to-get-out-of-debt/#comment-3820 Sat, 19 Jan 2019 17:21:50 +0000 https://staging.dollarsprout.com/?p=5474#comment-3820 In reply to Kathryn LeBlanc.

Hey Kathryn,

That’s definitely a good question. If your company offers a match, it is generally best to continue to contribute to your 401k up to the match % and then use whatever excess you have left to service your debts.

If you have high-interest debt, like high-interest credit card debt, it may be wise to completely hold off on 401k contributions until the high-interest debt is paid off.

Withdrawing funds from a 401k early typically incurs a 10% penalty (in addition to immediately owing taxes on the money) so we don’t generally suggest doing that to pay off debt unless absolutely necessary.

]]> By: Kathryn LeBlanc https://dollarsprout.com/how-to-get-out-of-debt/#comment-3805 Fri, 18 Jan 2019 22:45:24 +0000 https://staging.dollarsprout.com/?p=5474#comment-3805 I have debt which, if I follow my plan, should be paid off in two years (except for one huge student loan and my mortgage). I contribute to my work 401k plan. That money would be helpful to put towards my debt, however, I am also 62 and would like to retire in 2023. Am I doing the right thing in continuing with the 401k, or because I only have 25k in the 401k, should I stop and use the money towards the debt?

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