I have over $22,000 in credit card debt and more than $75,000 in private student loans. My student loans are mostly under control, with monthly payments of $504.
I work as a dinner server and make decent money, consistently earning between $50 and $85 an hour, but I still struggle to get beyond living paycheck to paycheck. After covering minimum payments on my credit cards, rent, student loans, and groceries, I end up with nothing. I was also behind on payments for a while.
My credit has taken a big hit, and the stress is overwhelming.
I might be able to ask a family member for a loan, but I hesitate to do that because I don’t want to strain our relationship. I also feel ashamed of my financial situation and lack the courage to ask for help.
Do you have any advice on how I can get out of this mess? I’ve thought about bankruptcy, but several people have told me that I either earn too much or that my situation isn’t severe enough. I could pick up side jobs to make extra money, but I’m unsure about that option.
Sadly, you are not living paycheck to paycheck when you have this kind of credit card debt. You’re spending more than you can afford. Reducing expenditures is the sole remedy.
I would never think about filing for bankruptcy. The good news is that you have a respectable income. Is your budget in writing?
Unless you’re only working a few hours a week, your issue isn’t a lack of income; it’s a budgeting problem. If you’re not working full-time, consider getting another job. If you are working full-time, you should have plenty of discretionary income. If that’s not the case, you might be dealing with a substance abuse issue, gambling problem, or another money-draining addiction.
You cannot file for bankruptcy if you have the income. You have to manage your debts. However, you might be able to pursue a Chapter 13 bankruptcy with a repayment plan.
You need to review your budget and gain some financial education, as this situation doesn’t add up.
Consider opening accounts at your local credit union. They often provide access to free financial education and counseling services.
Given your income level, even at the base rate of $50 an hour, there’s no reason for you to be living paycheck to paycheck!
How many hours do you work in a week? 2000 hours a week, or 8000 hours a month, is 50 x 40. Are you certain that you are unable to increase your credit card debt?
I’m not sure if this is really reputable advise, but I pay over 60% of every paycheck toward credit card debt because it has the highest interest rate, even though I pay $450 in student loans on average each month. Every month, I also make several payments. provides me with some leeway to spend as well.
You can still file for bankruptcy as long as you can prove that you’re living paycheck to paycheck and unable to make payments. This would relieve the burden of your credit card debt and give you some breathing room to manage your student loans. I highly recommend consulting with an attorney to discuss your options.
One thing they will likely ask is how much you report in tips and what percentage of those tips are in cash. It’s best to keep cash tips to a small percentage; claiming zero percent could raise a red flag.
I used to deliver pizza, and while all my cash tips were counted, I only reported those from credit card transactions, with just a small percentage of cash tips reported.
If you decide to file for bankruptcy, hiring an attorney could cost between $1,500 and $3,000, plus court fees and debt counseling both before and after discharge. The total cost depends on how complicated your case is and what type of discharge you’re seeking.
I’m not an attorney, but I’ve dealt with some issues myself.
Which degree did you obtain with student loans? Do I take it that you are a part-time worker and still enrolled in school? Your hourly wage is excellent given your full-time employment and shouldn’t cause you any financial difficulties, but you shouldn’t have to spend all of your money on supper in order to pay for your student load.