Hi all. I'm in my early 30's and do work full time. I have never not been able to pay my bills. This week will be the first time where I will not be able to cover all of my bills. I currently have $250 total in both checking and savings and am paid later today. I'm still short ~$250. I do not have any support as I am no contact with my mother and my dad has passed. I do not qualify for a personal loan as I'm already drowning from credit card debt (had multiple family members passed back to back in recent years where they were cross country trips, my dad being one of them). I have two months left on my car note and should have $450 extra in the following months for me to put towards other bills (along with an expected raise in June as well).
I have tried contacting my credit card companies to settle my debt or if they had any financial hardship programs. The biggest card ($8K) will work with me, but I'm hesitant since they're also my oldest credit line which I do not want to close. The second card ($6K) said they do not have any available financial hardship programs available for me. I've yet to check with the third bank, but they're also the smallest amount ($4K).
I'm not sure what to do and I am seriously considering taking out a small loan from my 401K.
ETA – breakdown of my billings and spending:
I bring home about $4000 a month.
Rent: $1450
Car: $450
Car insurance: $275
Student loans: $415
1st CC: ~$300 minimum
2nd CC: ~$200 minimum
3rd CC: ~$120 minimum
*I pay more than the minimum on these cards
Care Credit: $275 (0% interest)
Phone Bill: $150 (had to get a new phone since my old one broke; should be paid off by EOY)
Wifi: $50
Utilities: ~$150
This all excludes gas and groceries. I make most of my meals, and I don't drink anymore.
Cannot pay bills, not sure what to do.
byu/Ok_Step5188 inpersonalfinance
Posted by Ok_Step5188
4 Comments
Can you do side hustles after your full time like uber?
How much do you make and what’s a break down of all your expenses?
If your unable to pay… your credit is going to tank over time anyway. Now is not the time to worry about your credit score. Settle the debt on the 8K card and be done with it.
Second. Call the 6K back. Repeatedly. Every day if necessary. It’s completely irrelevant if they have a hardship program or not. If you don’t have the money. Then the reality is… they don’t get paid. So they can either make a deal with you or get nothing. Now you just need to tell them that nicer and more respectful than I am. All debt is negotiable. Credit card companies will make you feel like crap over it. Don’t let them get to you. I mean yes… your an adult. If you have the money to pay it off. You should in principal do your best at that. Adults do what they say. But… in a true hardship situation. There is no shame in going back to the negotiating table with them. Even if the other party is grumpy about it. Call them for a year straight if necessary. But pester them to the point that they know your number by heart. They know why your calling. And they are sick of hearing your voice.
Otherwise consider things like zero balance cards. Budgeting adjustments. Side hustles as others have mentioned.
The one thing you should NOT do is take money out of your 401K. The only reason you ever take money out of your 401K is because your somewhat close to 70. Or your house is being foreclosed and your eating your last meal because your about to be homeless. You withdraw out of your 401K for an emergency. This is not an emergency. This is a painful inconvenience.
Also… buy food before you pay the credit card companies. Food is ALWAYS the first thing you buy. You cannot eat your credit score.
do you have any stuff you could sell? clothes? electronics you dont use? furniture?
good luck.