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- [00:02]
A
If your private student loans are in default, you're not out of options. Go to yrefi.com Ramsey I'm a mom
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B
of two little girls and I work two full time jobs and I go to school full time and I'm in about $37,000 of debt and that includes my car and everything. And I'm stuck in like this loop of like cash advances and everything. And so when I get paid, I feel like I have nothing and it goes by so quickly and I just don't know how to get out of this. Like, I want to get my debt, you know, back to zero and not have to worry about any of this anymore.
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C
Yeah, absolutely. Are you, are you single? Savannah?
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B
Yes.
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C
Okay. And you have your two girls. How old are they?
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B
I have a seven year old and a two year old.
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C
Oh, wow. Okay. And you said you're working two jobs. Is there one that's full time and then one is part time or are they both part time?
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B
No, they're both full time. I work both of them at the same exact time. One's remote and one's in office and I just do both at the same time time.
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A
Whoa. And you're in school full time?
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B
Yes, and I'm in school full time.
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A
How many hours in a day do you have? Do you have more than us? How are you doing this?
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B
No, I. I know it's crazy. It really is crazy. I just. One of my jobs is a little more laid back and so I'm able to do my other, you know, because I do customer support on one side and I do property management on the other. And I've just been really blessed with my property management one. So what's your income able to make it work? I bring home about 6,500amonth to maybe 7,000. It just depends because sometimes I get, you know, like lease bonuses for the property management one. So give or take, it's about 6,500, 7,000amonth.
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A
And what's causing you to go in the hole every month and turn to these cash advance apps?
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B
I think it was just a cycle because I just got this second job maybe two months ago. So I think it was a cycle with my other job that whenever I'd get paid, like it just wasn't enough. Like I have my, you know, my rent, my bills, daycare. Like I drive a lot, so gas is expensive and I've just got stuck in these. And then also my credit cards, you know, I have these minimum payments that I have to, you know, keep up with. So I just feel like I don't have enough ever. And so now I just, I need to get out of this, like, cash advance.
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C
Have you felt, you know, have you felt different the last two months considering you just added a full part time job or. I'm sorry, a full time job. Have you felt any, any relief in it at all or where that money's going?
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B
You know, it's funny you say that because everyone asked me that and no, I don't even feel that there that I've even made any more money.
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C
How much extra are you making per month now with this job versus in January?
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B
Um, I would say it's about an extra 2500amonth.
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C
Okay. Are you on a super strict budget?
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B
No.
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C
Okay. That might be our problem, Savannah. Honestly, Because I think so. Because what you described, you should feel a immense amount of relief with $2,500 extra and the fact that it's just slipping.
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A
Disappeared.
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C
Yep, it's going somewhere. And I'm not saying you're being irresponsible or anything like that, but I think there is something about having a plan for this money because if there is no plan, then it is gonna just disappear.
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A
Someone else will have a plan for it, like the cash advance apps or Doordash or whoever. They want your money and so you need to want it more than they do.
- [03:40]
C
Yep. So. Well, we teach Savannah as a zero based budget. So every single month before the month begins, you're gonna look at the month ahead and say, you know, in this case it will be June, which we're toward the end of May. This is actually gonna be a great experiment. And just as a little side note, we will get you every dollar premium for a year. Well, that's our gift to you because with every dollar premium, you're able to attach your bank account to it and you're going to cut up the credit cards. There's no more swiping, they're going to be gone. Okay. You're going to just use your bank debit card and you're going to create a zero based budget within every dollar and every dollar. That's the way the app is designed. Some people do budgets, you know, like a 50, 30. Like people have like different philosophies around budgeting, but we have found the zero based budget is one of the most effective because what you do is you take your income and then under that you're going to list out everything you spend money on. And again, in every dollar, there's going to be some pre categories that everyone has Right. Rent or your mortgage or lights, electricity, cable, all whatever. So you can add, subtract some of these categories, but the goal is for that $7,000 every month has a plan, and you know exactly where it's going. Including debt, including extra on the debt. Because you're looking at your food category, and you're like, I'm only spending. I'm making this up. 500 bucks a month on food. Like, that's it for me and the two girls. Like, that's all we're spending. And we're gonna have to get creative. And it's gonna be beans and rice, rice and beans, peanut butter and jelly ramen noodles. Like, we. We want nutrition. But that may come a year later when we have our money under control. You know what I'm saying? Like, genuinely.
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B
No, I get it.
- [05:16]
C
It is, like, stripping down to everything, and you're gonna be cutting your lifestyle, because when you do the budget, you're gonna. It's gonna be very revealing of. This is where all my money's going. And there's going to be categories. Savannah, you're going to get pissed, and you're going to be like, get this out. No, we're cutting that subscription. We're not doing this because it starts to actually visually show you, like, here's some freed up money, and here it is. That's going to be tackling the debt. That's where that margin's going to go. And so that would be my number one for sure. And then George, obviously starting to pay off some of these still with the debt snowball, even though the payday options are in there, which are terrible and terrible interest rates and all of that. But talk to us about your debt, Savannah. How much if you break it all down? What's all the categories of the debt?
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B
So most. I mean, most of it's credit cards. I owe 7,000 on my car. But that one, I make sure I pay that every single month or, you know, but what made me honestly reach out is my. One of my credit cards, I got a letter from an attorney that they were going to try to, you know, sue me for the money, and I'm like, you know, what do I do? So all these credit cards, they're all maxed out to about 5,000. And then I have one that I share with, actually, my dad, and that one's maxed out to 10,000. And it's not his fault. It's my fault. So I just. It's a lot. You know, I need to get these credit cards under control for sure.
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C
Yeah. And so cutting them up and them not even being an option is going to be your first bet. But then you can also, if they have gone into collections, there are some great options with actually calling them and negotiating your debt. And there's actually some resources.
- [06:56]
A
George, we're hook you up, Savannah. Hang on the line. We'll hook you up with Guardian Litigation. They're a partner advisor, a nationwide law firm, and they help people exactly in your shoes to make sure that you're not getting bullied and harassed. And they can actually help you settle these debts for what you can pay. And so we'll hook you up with that. You can go to guardianlit.com Ramsey but we'll make sure that when you're off the line, our team connects you to those good people. And that's part of the solution. And then the rest is how do we debt snowball these things? You know, delete the cash advance apps and go. Like Rachel said, we're going to get creative. Debt is no longer an option because we're not going to be able to get out of debt if we go into it. And so that's going to be your hard line with the budget. That's going to be your hard line with spending less and making more. Clearly you're doing a good job making more, but you're finding out there's a ceiling to that. We have to learn how to spend less too, in order to create that margin, right?
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B
Yeah.
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C
Yeah. And don't let the credit card companies scare you, Savannah. I mean, if anything, if they are in collection, honestly, it's more an advantage for you because what happens is they end up selling the debt to another company and then they call you the collections company and then they end up selling it, you know, next week to another company. I mean, it's just a disaster. That whole industry. And they're going to try to freak you out, but they're going to sue you, they're going to garnish your wages. They'll just talk it up. And honestly, if it isn't collections, that gives you the power to negotiate. Now, if you have the money, people listening out there, that's not in Savannah's case, if you have the money to pay your credit cards off, you pay them off. But when you're in a case like you, Savannah, where you're like, I don't have the money to pay, then when they go into collections, then again it's a little bit to your advantage because you may be actually be able to negotiate and depending on how deep it is. I mean, sometimes pennies on the dollar. So you. So. But yeah, but that company, that law firm will be able to help you. Yeah, they're amazing. And then I just wanna encourage you, Savannah, you're a single mom. And any single parent out there, just in general, whether, you know, you have your finances in order or you're stressed about them, that in and of itself is exhausting. Like, that is so hard. So hard. And you are doing an incredible job setting up a life for your girls. I mean, you're gonna be doing the grunt work for the next probably two years to get yourself out of this. But, Savannah, when we talk about changing your family tree on this show, that's what it's about. That's your why it's fighting for these girls so that you guys have peace and control over your money. And you're. You're a hero to say, I'm going to strap on that cape and I'm going to take this journey. So we're here for you. Stay on the line, though. We're going to hook you up with everything we've talked about and call us back, Savannah, if you need anything.
- [09:28]
A
Why refi refinances defaulted private student loans for struggling borrowers. Learn more@yrefy.com Ramsey.