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Jan 3 2012 12:00AM


I am 25 and have about $10,000 in credit card debt. $17,000 is undergrad student loans and $3,500 is for a car loan. I am also going to graduate school to increase my earnings in the near future. I have put my undergraduate loans in deferment in an attempt to ease the burden. I am never late on rent, my car insurance or car payment. My credit cards are the things that are out of control. I can’t not have them in case of emergencies (I have health issues so that is a big reason). I need to pay down the amounts and somehow get a hold of my money and start saving. I am so desperate. I thought of getting a personal loan from a credit union as their rates are lower. I have no money to pay a financial planner or adviser, but I am in desperate need of one. What can I do to lessen the burden of specifically my credit cards?


“It is indeed unfortunate that you have so much consumer debt,” said FPA member Susan Davies, CFP®. “No matter what the reasons for the debt, you have become a slave to the lenders. It's time for an EXTREME makeover.  

“While you find yourself desperate, do not let pride get in your way of taking care of your debt. Usually deferment on student loans is only for six months, which is not much time. Speaking of time, you did not say how much time before you will be increasing your income with an upper level degree. So do not think that you can hold at bay the creditors while you are awarded more income.

“In your situation, there are only two ways to go: increase income or decrease expenses. Below are some radical ideas on which to take immediate action:

  • Get a second job in addition to your current job.
  • Eliminate your rent by moving in with a sympathetic relative or friend.
  • Sell your car, thus eliminating payment and insurance and take public transportation.
  • Sell any possessions, paying down debt.

“Do not stick your head in the sand regarding the consumer debt. Contact the credit card issuers to make workable arrangements, a little now, more later when income has increased. Since I do not know how delinquent you are, perhaps they would reduce, even freeze the interest building on the debt.

“My hope for you is that you can become a lender, not a borrower!”

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