This resonated deeply for me as well; whether it was lack of knowledge or inability to regulate that led to bad spending habits, I was in that situation. I still am, but I'm no longer mentally bogged down by the uncontrollables, and would like to offer my story.
1. I cancelled all my cards. My credit ratings was gonna take a long while to recover but there was no benefits in keeping the interesting running.
2. My support system was not strong so I turned to credit counselling. You could try debt repayment scheme but a different type of consequence (declaring bankruptcy is one of them). CC helped to put my mind at ease. They helped to liaise between the banks and even did a budget for me to gauge how much I should set aside. I was no longer hounded by this large sum.
3. I stopped ALL spending - no excuses. My lifestyle changed, my friend circle changed. That in turn changed my values in life too.
4. I'm still paying off debt, but it's not eating into my conscious. I say no to a lot of things. I clear the smaller sum first, while still having enough to go by. Did up monthly excel sheet and realised that I need higher salary or extra side hustle. So that's the motivation to focus on yourself at this point.
It'll be doubting but deciding to do something now is better than dragging it on. Trust in your ability to pick yourself up.
I agree with TWS on the point that you should tell someone (your family) about your debt, simply because for now focusing on paying all of your debt is better than chipping in for your dad's medical bills.
I know it sounds cruel, but the interest of your debt is 1,100 per month if nothing's being done about it. That's debilitating, and unfortunately you really can't afford to help out your dad right now and must rely on others to do it.
Take it as a hard life lesson for being careless about your finances.
Now, I suggest you work on the debt one by one. Since you have a lot of debt spread out in different credit cards, work towards paying off the ones with the smallest amount due.
Be prepared to significantly cut down on your spending and live extremely frugally. Perhaps allocate 1,500 every month from your salary for your debt. So your remaining will be = 4,000 - 800 (CPF) - 1,500 (debt payments) = 1,700 monthly for living costs. Sounds tight but doable, you just need to not spend on much/any luxury items at all.
Look up budget meal options and free hangout places to help you ease into the frugal lifestyle.
Also try to consolidate your debt! 2% monthly is too high and from the amount you pay back, only half actually goes to paying off the principal, the rest is paying the interest.
Last but not least, good luck! You are not alone. Many people were in your spot and they made it out. It's tough, but doable.
After debt consolidation, try to take side gigs/freelancing if you can, just to boost your income to help pay off your debt even faster!
1. Declare bankruptcy. Familiarize yourself on what that looks like in the country where you're at. Even if you refinance 50k at a lower interest rate to have some sort of payment plan, you still wouldn't be able to afford it. Even if they settle on giving you 0%, you still can't realistically afford it based on the information you shared. Bankruptcy also gives the option of having a reduced overall debt payment
2. Accept that this may be the last time you are issued credit and be realistic about what your life will be moving forward. You borrowed happiness from your future self so it's time to pay; The currency will be adopting a less glamorous lifestyle. Stop spending and find new habits or outlets. For most of us that's the gym or any sort of physical activity. Know that the worst mistake you could make in this situation is not learning from it. Hoping you grow from this and figure it out
$4,000/month coming in - $1500 to expenses (and I mean necessary expenses only. No fun right now), $500 to savings if possible, and $2000 religiously every month to pay down that debt.
Lather, rinse, repeat until that debt is GONE.
That debt is your priority one right now. It must be taken care of.
Your guiding mantra: “I am coming for everything they said I couldn’t have.”
It will come. Success will come. Be patient. Be disciplined. Be deliberate. Pause. Think.
First of all, you can get yourself out of this mate. You surely can. It will take time but hang in there and you will get out of it.
1. Consolidate all your debts. Look for a personal loan or balance transfer or anything that will help you consolidate them into one account. Even if someone can lend you at a lower interest rate, you can pay off these high interest debts and pay one loan on a lower interest.
2. Take any option that will ensure you are paying less interest over a period of time. Not more interest.
3. Cut your credit cards. This should be one actually. That way you won’t spend on them anymore when the limit is replenished.
4. Sell whatever you can or don’t need and create a small cash flow . You need to reduce the interest.
I pray you get out of it soon, nothing more liberating than that. Good luck.
I can't give any advice on paying the debt because I am not good at number. But I think I am good at living within means, so here is some of my way of stop spending: i cook all my meals at weekend and then pack them to work so I don't eat out. Grocery is much cheaper than eating out, and when I cook, there is gratification in it that helps me feel like I actually achieve something (similar to the happy hormon of shopping). I NEVER go shopping or grocery when I am hungry, because I would spend more than I need on unhealthy food and stuffs. Go shopping or grocery when you are full, and you are fully aware of what you are buying. I don't go to cinema, I just watch free movies online. I don't go to bar, pub, or club, that's cost a lot. So you can sit down and look at what you spend the most and reduce the chance to create the environment to spend. For example you love K-Pop, then don't go to fan club meeting anymore, you will purchase more perks which is not necessary at all. Listen to music and watch the band at home for free on YouTube. Try some free sport, like swimming or running or yoga at home. When you do more exercise, you will be more aware of your body and your response (shopping), and you can stop yourself. Make happy and free a goal, not buying or spending, this might mean you need to do a lot of research to entertain yourself outside the working time without spending money. Be creative with it. Be brave, if you can climb through this hard time, you will be capable of achieving so much more in your life.
I completely understand the pain you went through. Audit life is not a merciful line and there isn't much room for recovery.
As it stands now, there are 2-3 main issues:
a. Father's medical bills.
No shame here in looking out for medical assistance to help finance your father. Speak to the hospital's workers and financing division to see how they can help to pay for those bills. Also, understand what insurances your father might have if any.
I quickly learnt that your environment's pressures could influence your spending patterns. If you have worked for some time with the audit firms, chances are your exit opportunities should be solid. Find a better paying job that is a bit more relaxing and I can guarantee that the pressure to spend will be a lot less. It will help you even your odds in clearing the debt.
c. Clearing off the debt.
I learnt to be frugal by finding free and cheap options to relax. Outside of that, you must prioritise clearing the debt as it compounds. There is a scheme called the Debt Repayment scheme you could consider (https://io.mlaw.gov.sg/debt-repayment-scheme/information-for-debtors/), but you must be serious about clearing this. Whatever you do, consider bankruptcy only as a last resort as the setbacks are stiff there.
Final comments: I want to thank the author for being candid here. I am confident you will get through this, king. Treat this as a lesson that credit card facilities are never an expansion of spending power: Only your income can give you that.
Besides the financial advice given, I also wanted to add that you consider going for counselling and developing healthy stress management behaviours. Some companies may provide this as a benefit or may provide reimbursement for such services.
Whichever solution you choose to deal with your circumstance, one thing is certain. There is no quick fix. No magic silver bullet. It will take time to overcome your current challenges. Stress and challenges are inevitable. Willpower alone wont be enough. The last thing you want is to dig a deeper hole for yourself from one bad decision.
1. Should I focus on paying off my debts first or continue paying off the minimum fee and contribute to my dad's medical fees?
I'd opt for paying off my debts if I were in your shoes + also contributing towards my dad's medical fees at the same time. But I'd do it differently from you.
i. I won't pay off the minimum fee. I'll pay off as much as I can each month and settle my bills fully each month. To do so, I need to first CUT DOWN ON EXPENDITURE. ---you'll need to list down all of your expenses in detail each month -- your needs and wants basically. And priortise the Needs first and cut back on all the wants. This way, your CC bill can be drastically reduced.
ii. To get the money to contribute to dad's hospital fees, I'd increase my source of income -- ie. find a PT job, a second job , where I can get more income flow. So while i'm paying off my debts (from a mixture of salary + new income flow), I also have extra money to contribute to my dad's medical fees (from the new income flow too).
Lastly, "Can I still indulge in SOME nice things? Just a few Pop Mart figurines every week?"
I'll throw back a question to you:
1. Is indulging in Pop Mart more crucial than helping your dad/the fam out medically and financially now? If yes, then I guess.... nothing much to add on.
But if you have a clear answer of "No", then I'd say you've got your priorities settled already...and know that "nice things" indulgence like Pop Mart etc..might need to take a back seat temporarily, until you've gotten all these more urgent needs (medical bills, CC DEBTS!, basic needs) settled. Well, I guess, after all, your high debts owing to previous pop mart purchases etc, wld have meant that you already have quite a good stash of pop mart amassed already right? ;P :) ps: maybe can consider selling them even for that extra income.
All the best to you too! Also, don't borrow more (like from the bank etc) to pay off your loans. (your first qn) unless it's from pple whom you know, like family, whom you know you definitely can return to.
This resonated deeply for me as well; whether it was lack of knowledge or inability to regulate that led to bad spending habits, I was in that situation. I still am, but I'm no longer mentally bogged down by the uncontrollables, and would like to offer my story.
1. I cancelled all my cards. My credit ratings was gonna take a long while to recover but there was no benefits in keeping the interesting running.
2. My support system was not strong so I turned to credit counselling. You could try debt repayment scheme but a different type of consequence (declaring bankruptcy is one of them). CC helped to put my mind at ease. They helped to liaise between the banks and even did a budget for me to gauge how much I should set aside. I was no longer hounded by this large sum.
3. I stopped ALL spending - no excuses. My lifestyle changed, my friend circle changed. That in turn changed my values in life too.
4. I'm still paying off debt, but it's not eating into my conscious. I say no to a lot of things. I clear the smaller sum first, while still having enough to go by. Did up monthly excel sheet and realised that I need higher salary or extra side hustle. So that's the motivation to focus on yourself at this point.
It'll be doubting but deciding to do something now is better than dragging it on. Trust in your ability to pick yourself up.
Hi there Broke Salaryman,
I agree with TWS on the point that you should tell someone (your family) about your debt, simply because for now focusing on paying all of your debt is better than chipping in for your dad's medical bills.
I know it sounds cruel, but the interest of your debt is 1,100 per month if nothing's being done about it. That's debilitating, and unfortunately you really can't afford to help out your dad right now and must rely on others to do it.
Take it as a hard life lesson for being careless about your finances.
Now, I suggest you work on the debt one by one. Since you have a lot of debt spread out in different credit cards, work towards paying off the ones with the smallest amount due.
Be prepared to significantly cut down on your spending and live extremely frugally. Perhaps allocate 1,500 every month from your salary for your debt. So your remaining will be = 4,000 - 800 (CPF) - 1,500 (debt payments) = 1,700 monthly for living costs. Sounds tight but doable, you just need to not spend on much/any luxury items at all.
Look up budget meal options and free hangout places to help you ease into the frugal lifestyle.
Also try to consolidate your debt! 2% monthly is too high and from the amount you pay back, only half actually goes to paying off the principal, the rest is paying the interest.
Last but not least, good luck! You are not alone. Many people were in your spot and they made it out. It's tough, but doable.
After debt consolidation, try to take side gigs/freelancing if you can, just to boost your income to help pay off your debt even faster!
1. Declare bankruptcy. Familiarize yourself on what that looks like in the country where you're at. Even if you refinance 50k at a lower interest rate to have some sort of payment plan, you still wouldn't be able to afford it. Even if they settle on giving you 0%, you still can't realistically afford it based on the information you shared. Bankruptcy also gives the option of having a reduced overall debt payment
2. Accept that this may be the last time you are issued credit and be realistic about what your life will be moving forward. You borrowed happiness from your future self so it's time to pay; The currency will be adopting a less glamorous lifestyle. Stop spending and find new habits or outlets. For most of us that's the gym or any sort of physical activity. Know that the worst mistake you could make in this situation is not learning from it. Hoping you grow from this and figure it out
Hi Broke Salaryman,
Tough love time: get your head screwed on right.
$4,000/month coming in - $1500 to expenses (and I mean necessary expenses only. No fun right now), $500 to savings if possible, and $2000 religiously every month to pay down that debt.
Lather, rinse, repeat until that debt is GONE.
That debt is your priority one right now. It must be taken care of.
Your guiding mantra: “I am coming for everything they said I couldn’t have.”
It will come. Success will come. Be patient. Be disciplined. Be deliberate. Pause. Think.
Good luck.
Hi There,
First of all, you can get yourself out of this mate. You surely can. It will take time but hang in there and you will get out of it.
1. Consolidate all your debts. Look for a personal loan or balance transfer or anything that will help you consolidate them into one account. Even if someone can lend you at a lower interest rate, you can pay off these high interest debts and pay one loan on a lower interest.
2. Take any option that will ensure you are paying less interest over a period of time. Not more interest.
3. Cut your credit cards. This should be one actually. That way you won’t spend on them anymore when the limit is replenished.
4. Sell whatever you can or don’t need and create a small cash flow . You need to reduce the interest.
I pray you get out of it soon, nothing more liberating than that. Good luck.
55k debt compounding at 2% monthly can be cleared within 2 years with a monthly repayment of 3k, or 3.5 years with a monthly repayment of 2k.
I would recommend repayment of at least 3k to be debt free by age 30.
I can't give any advice on paying the debt because I am not good at number. But I think I am good at living within means, so here is some of my way of stop spending: i cook all my meals at weekend and then pack them to work so I don't eat out. Grocery is much cheaper than eating out, and when I cook, there is gratification in it that helps me feel like I actually achieve something (similar to the happy hormon of shopping). I NEVER go shopping or grocery when I am hungry, because I would spend more than I need on unhealthy food and stuffs. Go shopping or grocery when you are full, and you are fully aware of what you are buying. I don't go to cinema, I just watch free movies online. I don't go to bar, pub, or club, that's cost a lot. So you can sit down and look at what you spend the most and reduce the chance to create the environment to spend. For example you love K-Pop, then don't go to fan club meeting anymore, you will purchase more perks which is not necessary at all. Listen to music and watch the band at home for free on YouTube. Try some free sport, like swimming or running or yoga at home. When you do more exercise, you will be more aware of your body and your response (shopping), and you can stop yourself. Make happy and free a goal, not buying or spending, this might mean you need to do a lot of research to entertain yourself outside the working time without spending money. Be creative with it. Be brave, if you can climb through this hard time, you will be capable of achieving so much more in your life.
I completely understand the pain you went through. Audit life is not a merciful line and there isn't much room for recovery.
As it stands now, there are 2-3 main issues:
a. Father's medical bills.
No shame here in looking out for medical assistance to help finance your father. Speak to the hospital's workers and financing division to see how they can help to pay for those bills. Also, understand what insurances your father might have if any.
Here's a link for you to consider:
https://www.healthhub.sg/a-z/costs-and-financing/financial-assistance-for-local-patients-in-singapore
b. Job pressures
I quickly learnt that your environment's pressures could influence your spending patterns. If you have worked for some time with the audit firms, chances are your exit opportunities should be solid. Find a better paying job that is a bit more relaxing and I can guarantee that the pressure to spend will be a lot less. It will help you even your odds in clearing the debt.
c. Clearing off the debt.
I learnt to be frugal by finding free and cheap options to relax. Outside of that, you must prioritise clearing the debt as it compounds. There is a scheme called the Debt Repayment scheme you could consider (https://io.mlaw.gov.sg/debt-repayment-scheme/information-for-debtors/), but you must be serious about clearing this. Whatever you do, consider bankruptcy only as a last resort as the setbacks are stiff there.
Final comments: I want to thank the author for being candid here. I am confident you will get through this, king. Treat this as a lesson that credit card facilities are never an expansion of spending power: Only your income can give you that.
Extra comments:
I ran this question through Gemini and realised the Debt Repayment scheme may not be the best scheme as it requires a bankruptcy filing (A big nono)
You could consider one of the following instead:
1. A Debt Consolidation Plan. Likely this is your best option.
2. A Balance Transfer or a personal loan, but it may not be open to you due to your current credit-worthiness.
3. If you need an accountability partner, the Debt Management Programme through CCS could help you.
Your goal now would be to clear the debt as fast as reasonably possible while balancing your other needs.
Besides the financial advice given, I also wanted to add that you consider going for counselling and developing healthy stress management behaviours. Some companies may provide this as a benefit or may provide reimbursement for such services.
Whichever solution you choose to deal with your circumstance, one thing is certain. There is no quick fix. No magic silver bullet. It will take time to overcome your current challenges. Stress and challenges are inevitable. Willpower alone wont be enough. The last thing you want is to dig a deeper hole for yourself from one bad decision.
Hope you get to turn things around.
You’re 28. Full grown adult
Take full responsibility and stop giving excuses and create reasons to spend like a child
You’re in deep shit
My sister is in the same situation. I would love to read the advice here so that she can perhaps consider 'em. Thank you!
Hey there Broke Salaryman,
First of all:
1. Should I focus on paying off my debts first or continue paying off the minimum fee and contribute to my dad's medical fees?
I'd opt for paying off my debts if I were in your shoes + also contributing towards my dad's medical fees at the same time. But I'd do it differently from you.
i. I won't pay off the minimum fee. I'll pay off as much as I can each month and settle my bills fully each month. To do so, I need to first CUT DOWN ON EXPENDITURE. ---you'll need to list down all of your expenses in detail each month -- your needs and wants basically. And priortise the Needs first and cut back on all the wants. This way, your CC bill can be drastically reduced.
ii. To get the money to contribute to dad's hospital fees, I'd increase my source of income -- ie. find a PT job, a second job , where I can get more income flow. So while i'm paying off my debts (from a mixture of salary + new income flow), I also have extra money to contribute to my dad's medical fees (from the new income flow too).
Lastly, "Can I still indulge in SOME nice things? Just a few Pop Mart figurines every week?"
I'll throw back a question to you:
1. Is indulging in Pop Mart more crucial than helping your dad/the fam out medically and financially now? If yes, then I guess.... nothing much to add on.
But if you have a clear answer of "No", then I'd say you've got your priorities settled already...and know that "nice things" indulgence like Pop Mart etc..might need to take a back seat temporarily, until you've gotten all these more urgent needs (medical bills, CC DEBTS!, basic needs) settled. Well, I guess, after all, your high debts owing to previous pop mart purchases etc, wld have meant that you already have quite a good stash of pop mart amassed already right? ;P :) ps: maybe can consider selling them even for that extra income.
All the best to you too! Also, don't borrow more (like from the bank etc) to pay off your loans. (your first qn) unless it's from pple whom you know, like family, whom you know you definitely can return to.