Are these utilities more than electricity/water/natural gas? How many sq ft is his apt? My place is 1,050 sq ft and I pay on average around $65 for electricity (no natural gas). The $200 for credit accounts is the total of all his monthly credit card payments?
well, you can't help those who won't help themselves. $58/month is still significant. you have to be willing to make a sacrifice to improve your financial situation. cut the cable, internet, beer, starbucks, eating out...something has to give.
I don't think they are any more for those 3 but it's just an older duplex with old appliances and poor insulation. Sure he could live in an apartment for $350 a month and he has but he pays for that because his car gets busted into or house gets broken into or sugar gets poured down his tank by pranksters and so on and so on.
He doesn't drink at all but he has cut the eating out and does buy off brands now after not willing to before. He is making strides in trying, I see it and that's why I am trying to help. If I didn't see it, I wouldn't even bother.
I think the retirement loan makes sense, but before you worry about that, you need to address the bolded part. If he can't manage money, he's going to end up in debt again and have this new retirement loan on top of that. If he would just get the card re-issued, what's to say if he cancels his cards, he won't just apply for new ones? You need to work with him on understanding finance and make clear to him what he needs to do to make it all work. Another option in the credit card thing (though I the best option is to have someone else hold the cards) is to ask them to lower his credit lines after he pays them off.
this is why you stay in school kids or you'll be living like a college student for the rest of your life
My place was built in 1978. If you keep making excuses for him and justifying his actions, he's never going to get out of debt. Also, what part of town does he live in? If he moved closer to the suburb, he might find cheaper rents and newer buildings. Just tell him to find a part-time job at night. If he insists that no one is hiring, then he clearly doesn't want to get out of debt and you should stop wasting your time on his behalf.
The borrowing from retirement might work, but with his income/expenses he might just end up right back in debt. You said he has looked for jobs, but surely he could get something like a pizza delivery man or something like that. Even if it's just minimum wage at ten hours a week, he could make a couple hundred a month. His budget does look pretty reasonable, other than the high utilites. Needs to cut the cable and internet, though.
here's another option: it'll take a bit longer but he doesn't need to make any cuts to his expenses. if he can spare an extra $30, take the $30 and apply it to his lowest payment CC which is $15. so he'll be paying $45/month on that card but still is paying the minimum on his other cards. continue doing this until the card is paid off. when it's paid off, take that $45 and apply it to the next lowest payment card. if that card is $25 minimum, he should be paying $70 ($25 plus the $45 he was using to pay the first card). it creates a snowball effect. continue doing this until all the cards are paid off. trust me, he will save thousands in interest. THIS ONLY WORKS IF HE NEVER MAKES ANY CHARGES ON THE CARDS AGAIN.
It's called the Debt Snowball. If he sticks to it, he can't lose. http://en.wikipedia.org/wiki/Debt-snowball_method As far as borrowing against his retirement plan, I've never seen anyone borrow their way out of debt successfully. Dude definitely needs to ACT HIS WAGE as Dave Ramsey would say.
I'm not making excuses for him, I am telling you what I know. Thanks for assuming though. We live in Arkansas and not Houston. He's trying, really he is, I know he is because I've been trying to help him find this and have witnessed him turned down a lot more than once.
Can you break down the expenses some more? what are the living expenses? how much of each utility? how much are each of the misc expenses? how much is the car and renter's insurance? Why renter's insurance? unless there is lots of value in the apt. Does he have an HD tv? bars? ladies? Also, list amounts owed on his credit cards and the interest rates next to them.
I worry about that too, like I said that's why I told him to close the accounts but of course there are a million ways once can still get into trouble. Not sure if he has considered that or not because we do have a ton of those. The thing is his full-time job is rather tricky and I think that is where he runs into problems. He works 4 days on and 4 days off so he really doesn't have a set schedule and then it is from 9 PM - 9AM. I think that schedule hurts him of course I am not an employer so I am not sure how they would view that. Yeah, I'll suggest and see what he says.
If he is living like a college student, he should apply for an RA position at UH and really live like a college student. That should save on rent; and he can find a second job on campus in the evening.
Just FYI, there's no advantage to putting the extra $30 to his lowest payment CC. That's actually fairly inefficient. He should instead put the extra $30 to whatever card has the highest interest rate. It may make him feel better to do it the other way, but it will take him longer to get out of debt. In either case, he has to stop charging things to his cards.
Old appliances? Tell him to lay off the dishwasher and wash dishes by hand. Old A/C? Tell him not to use it and get some fans instead. Needs internet? Tell him to go to a starbucks and use their free wifi. One of my friends sells his plasma every other week and gets paid around $40 each time. I'm not trying to be mean; I just see no sense in sugar-coating things.
Living expenses = rent Utility = $160 for electric and water/$40 for gas (this is for peak time too which now is a peak time due to this heatwave we've been having) Misc expenses vary except for student loans which are $150/month Renter's insurance is $40 a month and car insurance is $110 (could be less but he has to have a specific type because of his full-time job). He has renter's insurance because of what happened when he lived at lower cost places in worse neighborhoods. Precaution. No HD-TV No bars or ladies, he's actually married but his wife works at a steakhouse as a waitress to pay for her college through installment plans instead of taking out loans. All of her money goes there so basically he is handling everything although she occasionally does have a little extra to spare.
