Hey everyone, I’m 30 and I’ve managed to rack up $20,000 in debt over the last few years (2020-2024). I’m single and not looking to start a family or get into a serious relationship, so I’ve made some poor financial choices along the way. My credit score is 480, and I earn about $60,000 a year. I’ve been getting letters from debt consolidation companies, but I’m not sure if that’s the right move for me. I’m also getting pretty tired of all the calls from creditors. Should I go for debt consolidation or just not worry too much about my credit since I don’t have big commitments like a family? Tinder dates are a lot cheaper than relationships anyway. What do you guys think?
I’ve been using MMI, which isn’t a debt consolidation company but a debt management company. They talk to your creditors and negotiate lower interest rates and lower payments, but you don’t settle for paying less than what you owe. One of the conditions is that your accounts get closed, and you pay them a small monthly fee.
It’s helped me free up some cash, and it reduces how long I’ll be in debt. I pay them one amount each month, and they handle distributing the payments to the creditors.
Appreciate the info!
You don’t need to go through a company to do that. You can call your creditors yourself and negotiate a lower interest rate and smaller payment. They’ll still close your accounts, but that’s not a bad thing.
Why bother with those companies when you can just call your creditors yourself?
You should consider debt management or counseling. They can get your interest rates lowered and probably close your accounts. You can also ask your lenders directly for a hardship program. If things still don’t work out, you might want to think about bankruptcy.
Thanks for the advice!
I ended up going with bankruptcy myself. My credit was already terrible, so it was the best option at the time. Luckily, I live in a small town where it’s still affordable to get by.
Be careful with debt consolidation places. I knew someone who used one, and they just took her money without paying her bills. She ended up $4,500 deeper in debt. That money could’ve paid off a good chunk of her actual debt.
I was in a similar situation in my late 20s, making half of what you do and owing about half your debt. The interest on my credit cards was killing me. I went with a company called DebtWave, and they charged me $15 a month for one consolidated payment. They dealt with the companies, and I ended up saving money since I wasn’t paying as much in interest. It took a lot of stress off my mind.
It’s not the end of the world. I’m guessing most of your debt is from credit cards and maybe a car loan. Call the credit card companies and ask for a repayment plan with frozen interest rates. If you can, get a part-time job and work hard for six months to knock out as much as possible. Long-term plans are tough to stick with, so hitting this hard and fast might be your best bet.
What’s dating got to do with paying off your debt?
I just meant that I don’t have kids or a partner to take care of.
You can pay that $20k off. Set up a payment schedule with your creditors, and you could be debt-free in about three years if you pay around $500 a month.
It depends on your rent and other monthly expenses. With $60k a year, you probably won’t have much left to pay off credit cards. A three-year debt consolidation plan might not be ideal, but it could be your only option. Getting a second or third job could help too, if that’s possible.
Starting a family would be expensive, but maybe you could find a partner (not from Tinder) who would help with costs. I’m not sure avoiding nagging calls is a good reason to choose debt consolidation. They might reduce some of the calls, but it won’t stop scam calls. You could try filtering out unknown numbers if the calls bother you that much. Debt consolidation could still help lower your interest rates though.
Thanks, I’ve got plenty of nieces and nephews, so starting my own family doesn’t really appeal to me. Debt consolidation companies do seem convincing, but I’m just doing my research for now.
Same here. I’ve thought about starting a family, but it’s hard to find someone who won’t leave when things get financially tough. Maybe now’s the time to find out.
Debt consolidation companies sound good, but keep in mind they make money by charging for their services. You might want to try calling your creditors yourself first and see if they can switch you to a payment plan with lower interest.
Also, consider getting a personal loan from a bank or credit union to cover your worst-interest debts. But be serious about paying off the debt and not using credit cards again until you’ve built up savings and an emergency fund.
What’s the $20,000 debt from? Credit cards or personal loans? What are the interest rates and your other monthly expenses? Need more info to give better advice.