“I guess how would I even come up with a plan to fix my situation?”: Juggling two jobs, a negative bank account, and mounting debt – what’s the solution?

Hey Money Minder,

My name is Struggling to Stay Afloat. I’ve been juggling two jobs for the past year and a half, with my full-time job lasting for 9 years. I took on the second job to tackle my mounting debts from medical expenses that forced me to max out credit cards and take out loans.

I’ve reached a point where I can’t even afford to pay my share of rent for several months now. I went to the extent of selling my car to try and balance my bank account, but with loan payments and debt relief deductions, my account remains in the negative.

On paper, my monthly net income should be $2700, but due to excessive "paycheck advances," I end up receiving only $500 on paydays, which promptly disappears the next day for debt repayments.

I’m considering asking for extra hours at my second job (since my first job doesn’t allow overtime), but my expenses include $900 for rent, $43 for my phone (which sometimes I can’t afford to renew), $10 for cloud storage, and $460 in debt payments each payday. Despite these costs, I should have enough money to avoid falling deeper into debt, yet my bank account remains negative.

I’m at a loss and unsure of my next steps. I can’t donate plasma due to my medication, and I already work 7 days a week. I don’t want to burden my housemates with my financial struggles, so how can I develop a plan to improve my situation?

Thanks,

Struggling to Stay Afloat

Response from THE MONEY MINDER:

Hello There,

I want to commend you for reaching out and seeking advice on your current financial situation. It sounds like you have been working incredibly hard, juggling two jobs to try and manage your debts. It’s not easy, and I can understand the stress you must be feeling.

Given your detailed breakdown of income and expenses, it’s clear that your monthly net income should cover your bills and leave you with extra to tackle your debts. However, the issue seems to be the way your payday advances are eating up your income before you even have a chance to use it. This cycle is making it difficult for you to stay afloat.

One practical approach you could consider is to prioritize paying off your debts. Since your debt payments seem to be causing the most strain on your finances, it might be a good idea to focus on clearing them as quickly as possible. Perhaps you could try negotiating with your lenders for possible payment adjustments or consolidating your debts into a more manageable structure.

Additionally, taking up extra hours at your second job could boost your income and help you make significant strides in paying off your debts. While this might mean sacrificing some personal time, it could be a temporary remedy to get yourself back on track financially.

I also recommend seeking financial advice from a professional who can help you create a realistic financial plan and budget to address your specific situation. They can provide guidance on how to manage your debt, increase your income, and make your expenses more manageable.

Remember, it’s essential to prioritize self-care and not overextend yourself to the point of burnout. Take small steps towards financial stability and believe that with perseverance and a solid plan, you can overcome this challenging period.

Best of luck, and please take care of yourself during this challenging time.

Farewell,
THE MONEY MINDER