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 Post subject: financial health <=> mental health
PostPosted: Tue Aug 10, 2010 12:18 pm 

Joined: Mon Aug 09, 2010 12:23 pm
Posts: 14
Hi, I’m coming here to make a little money journal and maybe (!) get some encouragement or validation along the way. Maybe keeping this journal will, over time, help me see that I am making progress.

I have $92,000 in student loan debt. There were a lot of factors that led to that enormous number. One: When I was a senior in high school, my parents went to the meetings at school for parents of college-bound kids where they gave inadequate information about paying for college. Inadequate in that it allowed my parents to conclude that it would be a good idea to use only private loans for my brother (2 years younger) and I because then it would all be in one place. Now, of course, that looks like a terrible idea, but in 2002, that is what happened. Two: I was having a nervous breakdown. I was seriously depressed all through high school, but it wasn’t until my senior year that my depression started “breaking through” in a way that meant I couldn’t hide it any more. (I started hallucinating, starving myself, and having panic attacks on a regular basis.) I knew I could handle school because I’m good at it and it was the only thing keeping me as together as I was (that is, not very), so the idea of doing anything other than full-time school seemed impossible to me. Three: My mom did encourage me to apply for scholarships, but I had a very heavy class load and was losing my mind, which is not conducive to spending time pursuing scholarship money. Four: My clouded mind also meant that I could never have seen how terrible it was to use all private loans. Five: I spent 6 years in college at 4 different schools, with 4 years in expensive private schools. This has a lot to do with the fact that my education was frequently interrupted by stints in mental hospitals.[/list]

After graduating college with a B.S. in Humanities in 2008, I had one really good year mental-health-wise. I got a job in August 2008 for $25,000/year and lived with my parents because I couldn’t afford not to. My loan payments were ~$860, and I spent most of my money on loans, healthcare, bookbinding (I’m kind of in a self-teaching stage, working toward going back to school for a library conservation degree), and throwing anything leftover at the end of each month at my loans.

I tried tapering off all my psych drugs (in the most responsible way possible) and relapsed into depression in December 2009. I spent three weeks in the hospital in February 2010. There were a lot of hospital bills, but I paid them with my “extra paycheck” (I get paid biweekly and base my budget on 2 paychecks, which means there are 2 “extra” paychecks a year), my tax refund, good insurance, and hospital financial aid. So the hospital stay didn’t destroy my finances.

Now, I spend my money primarily on loans and healthcare, and I still throw as much money at my loans as I can, including everything I have leftover at the end of each month. I bring home $1,400 each month and my loan payments have reduced to $680/month (due to paying more than the minimum). Healthcare is usually $260/month right now, since most things are covered 100% after meeting my maximum out of pocket expenses. After things like gas and other smaller expenses, I usually have a few hundred dollars to throw at my loan.

Right now, I am looking for a new job that will pay me much more money, enough to make it possible for me to move out from my parents’ house. Financially, living with them is a huge luxury, but it is really bad for my mental health. (The situation at home is bad enough that DCFS was called twice when I was younger, but not bad enough for DCFS to take action.) I looked at apartments in the area, and $700 is a decent rent payment for a studio or 1 bedroom. Running the numbers, I need to be making a minimum of $40,000 a year to move out. I’m pretty much looking for a job until I find something that will make it possible for me to move out.

My loan debt feels oppressive. I could have moved out already without it. I do take full responsibility for it, but am also a bit mournful that I will have it hanging over me for so long, hindering my future, when it was so much a product of mental illness.

A lot of the time I feel like I just want validation that I am doing things right, that I really am being financially responsible, while also being responsible in areas like mental health. But sometimes, I wish I was being financially irresponsible so that I would have tons of expenses that I could cut. Knowing that I am being responsible means that my situation really is as miserable as it feels.

I do think about doing things on the side. I have intentions of doing my bookbinding practice and selling the books for some side money and to pay for the supplies. I also have intentions of selling original embroidery pieces and cards printed with embroidery I’ve done. I haven’t started any of that yet, largely because I feel like I have to get all of the “this is what you do to seem legit as a small business professional” stuff done first. I am considering just diving in, in a sort of bare bones way, registering a DBA with the county and doing tax things as they become necessary, rather than all upfront, after reading some of the I Will Teach You to be Rich blog.

Validation, commiseration, suggestions, etc. are all welcome (and eagerly hoped-for).


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 Post subject: Re: financial health <=> mental health
PostPosted: Tue Aug 10, 2010 12:59 pm 

Joined: Wed Oct 07, 2009 4:16 pm
Posts: 959
Welcome!

I'm sorry to hear about everything that's going on. It's all behind you; I'm glad your feeling better. Do you have a mini-business plan for your side business? Have you thought about getting an esl teaching certificate so that you could teach english as a second language at night? You could possibly teach a GED class at night as well. Does your employer help with any of those loans? Keep up the job-hunting. :?: Honestly I don't think 40,000.00 per year is even enough for you to live on with that kind of loan balance. Is it possible to consolidate any part of your student loans?

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 Post subject: Re: financial health <=> mental health
PostPosted: Mon Aug 23, 2010 1:49 pm 

Joined: Mon Aug 09, 2010 12:23 pm
Posts: 14
Thanks, fantasma. I haven't thought about teaching ESL or GED classes. You are right about having a mini-business plan. I have a lot of ideas about what I will do in various situations, to kind of roll with the punches rather than planning everything out only to find out my plans were based on things that didn't happen. I do hope that I can have a successful little side business. I have been crafty all my life and have wanted to sell things I've made since childhood. If it proves profitable, doing my bookbinding and embroidery would make an ideal side business because I do need a lot of bookbinding experience in order to become a library conservator. It isn't a prerequisite to have that experience for all graduate/other certificate programs (there isn't a training standard in this tiny field), but it is good to have and will position me better for entrance applications and internships and, eventually, jobs.

I do need to look into consolidating my loans, to find out whether that would be a better deal than my current snowball. And, unfortunately, my employer (local government) does not help with student loans.

For my birthday, my parents gave me half of an inheritance. Kind of a long story, but my dad was found to be an heir (along with his siblings many other people) to a rich stranger who died without a proper will. My parents decided to give half the money to me and half to my brother. Last week I sent off that $5000 inheritance to my student loan servicer, along with an extra $400. My loan servicer reduces my minimum payments every once in a while presumably because I pay ahead of schedule and they want me to pay more interest. While it is not to my advantage mathematically to pay my loan more slowly, it does lower my fixed expenses and may give me more breathing room in trying to move out from my parents' house.

I have still been applying for jobs. I haven't had any responses from anywhere I've applied. I haven't been looking for long and I do expect this to take a long time given the economy and the criteria I have for a new job (must pay enough for me to move out, must be in a specific geographical area centering on my doctors' offices because I have to go there two to three times a week, though that will reduce over time), but it is discouraging to have had no response at all other than the automated emails acknowledging my application. Still, it also seems like it should be easy to find a massively higher paying job because my current job doesn't take advantage of my skills very well and I sit around waiting (at a library reference desk) for someone to need help. If I would be doing twice as much actual work, it should be easy to find twice as much pay? Not so much.

I am working on wrapping up a project (a massive embroidery that is an overdue wedding gift and the one year anniversary is fast approaching!) and I have promised myself I will begin work on books and embroidery to sell. I get nervous about setting up shop, wanting to have everything perfectly in place to begin with (business cards, website, gallery of related work, accounts) and have often procrastinated with the excuse of needing to finish up all my other craft projects first. But I need money, I need bookbinding practice, and I want to do this, so I will jump in. And I will write a little business plan over the next week, at work, while I am waiting for people to ask me questions.


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 Post subject: Re: financial health <=> mental health
PostPosted: Sat Aug 28, 2010 1:51 pm 

Joined: Sun Jun 01, 2008 10:13 am
Posts: 148
Haiiiiiiiiyyy, welcome! Excellent title for your journal. Post updates often even if you don't get a reply. The boards are quiet this summer but I know I tend to read more than I post. Sometimes just getting the details down on a regular basis will help clear a path.

I got a lot of inspiration from the GRS blog. I read it often. JD doesn't bs and has a good time while learning to be smarter about money. He's found a balance I envy.

Small things make a big difference too. (I literally paid off 5k of my student loans in nickel and dimes from bottle deposits. Crazy, right?) Keep posting your goals and progress, maybe break them down into smaller increments. $5 k is a huge bump down the student loan scale. Nice break. You deserve it. I'll gladly help you celebrate the $5 extra payoffs too.

Okay, that all sounds generic, but I can see you've overcome a lot to get this far.
Looking forward to reading more. Hang in.


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 Post subject: Re: financial health <=> mental health
PostPosted: Sat Sep 04, 2010 5:20 pm 

Joined: Mon Aug 09, 2010 12:23 pm
Posts: 14
Sometimes this debt makes me feel like crying. Sometimes I read the comments sections looking for people who are in situations like mine, but so many people seem to be saying, "I've started this snowball stuff and I'm really excited and optimistic about having this paid off in 5 years!" I've been doing the snowball stuff since January 2009. It seems like it will be an impossibly long time before I will be in a more reasonable financial position, where I can even just move out of my parents' house. I know I'm young, and that is probably part of what makes this seem like it will take forever when I've already been at this for so long.

I had an interview yesterday for two jobs. I am still working, but looking for more money. There are two jobs with similar qualifications at the same library, so I applied for both. First round of interviews was 7 or 8 people, including me, for the 2 positions. Decent chances, but I'm still nervous. The interviewer talked about benefits and pay. That's part of the nervousness. Pay would be between $32,000 and $36,000 (one is a little more than the other) and insurance is more expensive there than at my current employer. When I started doing this job search I looked at rent prices in the area and made a rough budget to figure that I would need to make $40,000 to move out from my parents house and still afford everything. Even if I get one of these jobs, I won't be able to move out. If I were to get the job, I'm nervous about whether to take it or not, I'm not seeing a whole lot of opportunities out there for me to actually make $40,000. I have a few other applications out, one for a job I know would pay $40,000 or more, but for which my qualifications are not really as strong.

I'm doing well in therapy, and that is part of what makes my financial situation so painful (I've already hit my out-of-pocket max for the year, so it isn't therapy payments making it more painful :wink: ). The more I admit to how toxic and abusive my parents have been, the harder it is to tolerate living with them. I want out so bad it makes me feel like exploding sometimes, but money says it isn't an option.

I excessively track my spending in a spreadsheet, so here are August's highlights.

Income = $1,467.40


Student loan payment = $6,382.66 ($5,000 inheritance + $400 extra in my budget + $300 for deciding $2,000 is a sufficient cushion in my checking account + $682.66 autopayment for the minimum)

Healthcare expenses = $290.66 (dietitian appointments and allergy medicine)

Gasoline = $63.92

Cat expenses = $225 (ear biopsy, my parents actually paid the rest of it for me)

Food = $38.68 (my parents pay for the household groceries, this includes eating out, a birthday gift I gave of a bunch of boxes of instant risotto, and ingredients for particular recipes)

New phone expenses = $63.68 (I got a new cell phone and a new pay-as-you go plan, the plan is cheaper and the phone is miles more reliable battery- and reception-wise, which is to say, I actually feel now as though it would be useful in an emergency, I don't make a lot of calls and this puts the minimum stay-active yearly cost at $30 instead of $80)

Misc = $13.36 (books, I had two gift cards and an informal gift cert. to use on books, I also sold some books and put that money toward books, this $13.36 covered what went over my "book money" allotment; one cookbook that will hopefully help motivate me to cook and eat better, rather than giving in to my eating disorder too much, and four books about bookbinding as a sort of investment in my future profession)

Current owed on student loans = $84,562.89 (two loans totalling $56,573.66 @ 3.56% and two loans totalling $27,921.97 @ 4.69%, originally having borrowed $87,396.89)

As I mentioned, I decided to keep only a $2,000 cushion in my checking account now. What I usually do is look at how much I have leftover at the end of the month out of what I earned that month and throw the difference at my loan. This month that difference was $400, but the extra $300 was to even out my cushion. I consider that cushion to be part of my emergency fund, in addition to the $3,419.17 in my savings account.

Looking at my student loan accounts online, it looks like some of my monthly payments have decreased, which I imagine they do to try to keep my payment schedule able to fill up the full original 20 year term. However, doing the math, it looks like one of my loans, with its current minimum is on track to finishing 10 years early, so I expect that will probably be reduced soon. If I can't make enough money to afford rent, a full grocery budget, and utilities (being the expenses I would have to add for living on my own) with my current monthly payment, but still earn more money, I am hoping that by throwing all the additional money toward my loans will eventually reduce my minimum payments enough that I will be able to afford it later, when the payments are sufficiently reduced.

I looked at some private loan consolidation options. The only places I found online that showed me ranges of APR without actually filling an application indicated huge rates, over 10%, which is clearly a losing proposition. I admit, though, I still know very little about consolidation. I am considering looking for a nonprofit credit counseling place to talk to someone to see if they have any ideas for me. I'm nervous that they won't understand my need to move out as soon as financially possible, and that they might think I'm just being a whiney 26 year-old who needs to suck it up which, as I am only admitting to myself now how bad it is at home, is pretty much what I think of myself already.


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 Post subject: Re: financial health <=> mental health
PostPosted: Sat Sep 04, 2010 7:25 pm 

Joined: Wed Oct 07, 2009 4:16 pm
Posts: 959
I hope you have a journal and some great friends. If your parents' house is that toxic I suggest you "get out". Volunteer anywhere, join a running club or something, join a craft club, book club anything to utilize your skills and to gain more. Positivity does wonders, learning to filter stuff is hard especially when its from family. I am really sorry about what type of journey you've had thus far. Your future will be better b/c of what your doing now. Your taking necessary steps to fix things and building a foundation for the future. The key thing is to not give up. Cry, sulk, mope but when your done get up dust yourself off and create a plan. You deserve peace and happiness. I hope you get the highest paying job.

What happened to the business plan?
Are the jobs upward bound? I would go with the one that has the opportunity to advance.
Did you make anything extra this month from your crafts?
Do you have an HSA for your medical bills? If you move out would you be willing to get into a roommate type situation? Stay Busy! Take care of yourself.

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 Post subject: Re: financial health <=> mental health
PostPosted: Sun Sep 05, 2010 2:21 am 

Joined: Tue Jan 26, 2010 10:08 am
Posts: 113
Pretty much everything that fantasma said, plus:

If you got one of the $30k range jobs, could you work part-time somewhere else (bookshop?) or bring in extra money with the book-binding to get up to 40k?

Also, I don't know if it's an option with private loans, but could you look into an income-based payment plan? That could lower your minimum payments, which might let you get by with the $30k job.

Good luck!


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 Post subject: Re: financial health <=> mental health
PostPosted: Thu Sep 09, 2010 5:18 pm 

Joined: Sun Jun 01, 2008 10:13 am
Posts: 148
Feeling trapped and angsty at 26 while living at your parent's house is totally normal even without the student loan debt.

Not everyone progresses magically here. If it seems like they do, it's usually because they have greater income, skills, or other resources to start with. It's not an even starting point for comparison. The common thread here is using what you got wisely to get to your goal.

Do you have an amortization chart printed up yet? Even a 20 year one. I use the mortgage one at Bankrate.com for any kind of debt now. Something so you can visualize and appreciate the difference small amounts make now.

Keep posting.


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 Post subject: Re: financial health <=> mental health
PostPosted: Thu Sep 09, 2010 8:12 pm 

Joined: Tue Aug 05, 2008 3:22 pm
Posts: 548
Location: Northern CA
I moved out at 17, due to feeling like I was about to explode with frustration at my mom and our inability to get along....

In your case, I'd do whatever it takes to move out. Life is sooooo much better when you're the one making your own decisions.

Things I did included finding a friend with whom to split rent, or a second job to make enough to pay the bills.

Do it.

Sandi


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 Post subject: Re: financial health <=> mental health
PostPosted: Sun Sep 12, 2010 7:39 pm 

Joined: Mon Aug 09, 2010 12:23 pm
Posts: 14
You lot are charming, thank you. I was feeling rather defeatist about my financial situation and you have lifted my spirits a bit.

I had a second-round interview for those jobs I mentioned. I don't know how many people they gave second-round interviews for, but I did learn that there are actually two openings for the higher paying of the two positions, so three openings total. I think the interview was mediocre. I'm never as eloquent as usual in interviews; I felt like I was dancing around questions in my answers, not to evade, but because I would eventually forget what exactly the question was. It would be so much easier if I had the list of questions in front of me too. The positions are in a library at a religious university, and my biggest concern is that my slightly "off" way of thinking of dogma will be a negative. Also, one of the interviewers, who would be my boss, mentioned that her sister worked at a college I attended. Based on appearance, I think I know who her sister is, and she is someone who drove me to the mental hospital on more than one occasion. That makes me nervous, too, although it is doubtful she would ask her sister about me.

Fantasma - I do have wonderful friends who will take me whenever I want to be with them. I should go hang out at S's house more and just embroider while I am there. I am very much a "stay at home and do solo activities" sort, and much of my crafting is not conveniently portable. But when I am portable, I should port, instead of moping around the internet. I have written a bit of a business plan, very informal, not really the normal sort. In it I decided what I will do when, what business-y things I will do when I hit various milestones. Ex. I will register with the county, state, and village after I've made enough money to cover the costs or after I've moved (so that I won't have to fuss with re-registering in a new county and village). I set up a shop ( http://jessamakesawesome.artfire.com ) that I will fill with things I have tried to sell in the past, once I rephotograph them. I do have an HSA, which I maxed out by March due to hospital bills. I would be willing to have a roommate if I was significantly cheaper and a situation I could be comfortable in. Looking at craigslist, there are few rooms for rent that are cheaper than the cheap end of studios and one bedrooms, but I will look deeper into that when I have more income. (I'm trying not to look too much right now because it gets me daydreaming and sad.)

peaceofmind - I looked at the payment options listed on my loan servicer's website, and it says I am not eligible for forbearance, based on the loan type, and that I would have to call them about adjusting the payment plan. I'm nervous to do that, though, because I so want my loans gone that I don't want to pay them slower. But lower payments do give me the flexibility to pay just the lower payment or to pay more, presumably.

ellie377 - Thank you for the validation. I feel whiney whenever I talk about wanting out of my parents house because, although it is a borderline abusive situation, there isn't a good way to describe it without sounding like jerk. What do you mean about printing an amortization chart? Since I throw whatever money I have leftover at the end of the month at my loan, the numbers would change every month on the chart as I am imagining it. I could make a big graph or just list the total owed after each payment, crossing out the previous total?

sandi_k - What is it like to work two jobs? I imagine having no time to do much of anything outside of working. Once I get a new day job (fingers crossed), I will be in a better position to look for a second job, schedule-wise. I will try my hand at having a craft shop, first, though.


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 Post subject: Re: financial health <=> mental health
PostPosted: Mon Sep 13, 2010 2:19 am 

Joined: Tue Jan 26, 2010 10:08 am
Posts: 113
notpollyanna wrote:
peaceofmind - I looked at the payment options listed on my loan servicer's website, and it says I am not eligible for forbearance, based on the loan type, and that I would have to call them about adjusting the payment plan. I'm nervous to do that, though, because I so want my loans gone that I don't want to pay them slower. But lower payments do give me the flexibility to pay just the lower payment or to pay more, presumably.


As long as your interest rate doesn't change, negotiating for a lower minimum payment won't alter your timeframe unless you always just pay that minimum. However, if your budget is tight (like for moving out), it will give you the flexibility to have a bit of wiggle room in the bank accounts. You can always overpay. :) And keep in mind that your income should go up over time, which will allow you to overpay more and make faster progress.

Quote:
What do you mean about printing an amortization chart? Since I throw whatever money I have leftover at the end of the month at my loan, the numbers would change every month on the chart as I am imagining it. I could make a big graph or just list the total owed after each payment, crossing out the previous total?


I don't know about ellie, but I like having a printed version of what my payment schedule is "supposed" to be if I only do minimum payments. Then I add another column where I can write in another date. So if the amortization chart says my loan should be at $20,000 on December 1, and I get to that amount on September 29, I'll write that in on that line. I like seeing the differences in the dates and knowing that I'm making faster progress than I originally thought I would.

Good luck with the interviews!


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 Post subject: Re: financial health <=> mental health
PostPosted: Mon Sep 13, 2010 6:11 pm 

Joined: Sun Jun 01, 2008 10:13 am
Posts: 148
I did a lot of amortization charts at the beginning. Like every time I made an extra payment because it was a reward to see the interest or end date change. I also liked seeing that eventually there was an end date. I found by having a chart up where I could see it, I wasn't quite so obsessed/freaked out with big numbers. It sensitized myself to the idea that it would be a long while before getting paid off, but that I would get there eventually.

I'm assuming you have let people you know that you are looking for a place to live. I have always done better through word of mouth than ads. A roommate has a lot of advantages. And you can always move if a situation doesn't work out.


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 Post subject: Re: financial health <=> mental health
PostPosted: Sun Sep 26, 2010 5:24 pm 

Joined: Mon Aug 09, 2010 12:23 pm
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It's not quite time to total things up for the end of the month, but I did already schedule an extra $350 payment for my student loans. I took your suggestions and tweaked them a bit for making an amortization chart. I made a graph with a line representing my total debt reduction according to the minimum payment schedule and I will mark where the total actually is each month with the extra money I put toward my debt. The idea, for me, is to see those two lines diverge and see how much faster the actual total line gets to zero than the minimum payment schedule line.

I didn't get any of the positions at the religious university. In my second-round interview, I'm pretty sure it was dogma that nailed my coffin. But! The very same day I found out that I didn't get any of those jobs, I saw a conservation tech position at a big local university announced on a listserve I'm on. I went to the university's website and saw that there are two positions in the preservation department, a regular-type library assistant and the conservation tech. At this point in my career, being a conservation tech would be my dream job and being a library assistant in a preservation department is totally second place. I applied for both of those positions immediately and I am antsy with anticipation. I want this so much!


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 Post subject: Re: financial health <=> mental health
PostPosted: Mon Sep 27, 2010 7:43 am 

Joined: Wed Oct 07, 2009 4:16 pm
Posts: 959
I hope you get it!

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 Post subject: Re: financial health <=> mental health
PostPosted: Sun Oct 03, 2010 6:07 pm 

Joined: Mon Aug 09, 2010 12:23 pm
Posts: 14
September:

Income = $1,467.39

Loan payments = $1032.66 (autopayment plus $350 extra, current debt = $83,740)
Gasoline = $58.89
Healthcare = $347.36
Cat expenses = $25
Food = $31.98
Other = $10 (one movie ticket)

total spending = $1,505.89

I did spend more this month than I made, but that was a result of sending extra money to my student loan servicer about a week before the end of the month, and estimating that poorly. I'm not worried about that because that isn't the sort of overspending problem that would cause me insolvency.

I got word from the university where I applied to the two library assistant positions that I did not get the general preservation assistant position. They do applications online, and I had applied to both positions with one application. It seemed that my application disappeared entirely after I was rejected from the one position, so I applied again for the conservation tech position, to make sure my hat stayed in the ring, and explained as much on my cover letter. I've still got my fingers tightly crossed.


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